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Corporations hoarding homes thank Canadians for enthusiastically blaming immigration
(www.thebeaverton.com)
this post was submitted on 22 Aug 2023
557 points (97.8% liked)
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As someone who believes:
A) Housing investors collectively have made incredibly large amounts of money at cost of other Canadians.
B) Essentially every single level of government has done little to aid in housing/infrastructure developments. If not outright block them.
C) Given the other 2 issues aren't dealt with immigration is the only thing that can completely pivot overnight but we've only increased it.
I think the biggest issues is that in the last election 80% of voters seemed to think more of the same was okay. To be clear I'm talking about the people who voted for a party who's housing minister said that investor is helping the situation or the party's leader said the same or people who couldn't even be bothered to vote.
Canada's fertility rate hasn't been above the replacement rate in over 50 years and that is with immigration. It's currently at 1.4 (child per woman/family)
If you want to lower immigration rates, you're gonna need to increase birth rates unless you want to become the next Japan where the population is expected to halve within our lifetimes.
The issue is the supply of affordable housing, plain and simple, and there is no solution that does not involve the government intervening in the housing market in some form.
The opposite is also true: if you want to see higher birth rates then housing needs to be affordable. Most Canadians require some financial stability before they start a family, and that is difficult today with the sky high housing costs.
Canada's birth rate has held stagnant for the last 50 years. No time in the last 50 years has housing been affordable? Hell, Toronto had a housing crash in the 1990s. And it still wasn't affordable right after that?
If your answer is no, it is likely that it is fundamentally impossible to make housing affordable. It ultimately uses up a lot of labour and resources, while removing food growing capability and damaging the climate, for no productive benefit. Good for the individual, but a terrible strain on society as a whole. The cost reflects that.
And for the last 50 years, it seems. Even if we can wave a magic wand at housing, how can we be sure that doesn't end up "I can't have kids, food is too expensive!" and then "I can't have kids, internet service is too expensive!"?
The reality is that life has never been affordable. The only thing that changed 50-some-odd years ago was the invention of the birth control pill. And the harsh reality is that life can never be affordable. There is not enough time in the day.
The number one reason young people tell me they do not want kids these days is because they cannot afford it. Perhaps if housing was more affordable and wages weren't stagnated it wouldn't be a privledge to raise a family these days.
So they say. I always wonder what the real reason is.
Kids don't cost much. Moreover, they are a complete time sink. Anything that you used to spend money on vanishes as you won't have time for it anymore. It is likely the the average person will come out net ahead. And as the kids get a little bit order, they start to become productive, which becomes an income multiplicative factor.
If the average woman in Niger, where the average income is $50 USD per month, can have seven children, anyone in Canada can afford at least one child with ease.
I expect it is the "16 and Pregnant" movement that has dissuaded people from having children. The whole "Don't ruin your life having children, go to school and get a good job!" message that keeps getting perpetuated. People don't want to be seen as the rural hick woman pumping out babies. That stereotype has become the scorn of our society.
Children cost approximately $15,000 a year up to the age of 18.
According to StatsCan, the average total income for a person in Canada is $54,400 in 2021.
Experts tell us that we should only spend 30% of our income on housing. That would mean the average Canadian should be spending $16,320 a year. $54,400 minus $16,320 equals $38,080. If you have one child at $15,000 a year, that leaves you with $23,080.
$23,080 is a nice chunk of change, however we still haven't done any other bills. According to the Globe and Mail, the average new car payment is $880 per month. That's $10,560 a year. We're now at $13,080 in left over income.
In the 2023 Canada Food Price Report, a family four will spend $16,288.41. We'll take 75% of $16,288.41 to represent a family of three. That couple would be spending approximately $12,216.30 a year in food. $13,080 subtracting $12,216 .30 means you are left over with $863.70.
CCA currently states that the average price of gasoline in 2022 was $1.632. Let's say you have a 50l tank, that means you are spending $81.60 per fill up. Twice a month, means you spend $163.20. Over the course of a year, you will spend $1,958.40. Oh shit, we're in the red now with -$1,904.70
We still have to pay for our cell phone, internet, hair cuts, clothing, emergencies, save for retirement, pay down debt, etc.
You da real MVP with sources and everything
Great work sourcing. Too bad the message is misleading. Using those sources we can see, for example, his $15,000 figure includes the child's portion of shelter and transportation costs, which he then includes again when calculating the cost of housing and car ownership. You don't have to actually pay for those same things twice.
Poor people don't need cars. So it saves a lot of money.
Not to mention that if you look at what the $15,000 child cost includes, it already factors in things like transportation and shelter costs. Which @[email protected] includes again when budgeting parental costs.
Based on his numbers, removing the duplication, this single income supporting a family of three comes out comfortably in the black. And that's with childcare costs included! If you are going to pay for childcare, why not have two incomes supporting the family of three? Now you're saving money hand over fist.
If not being able to accurately calculate costs is the reason why Canadians aren't having children... Maybe it's best to keep that out of the gene pool anyway.
Keep in mind this figure includes things like cost of shelter. It certainly costs money to shelter a child, so the $15,000 isn't invalid, but not applicable if you are going to account for shelter elsewhere. Double entry accounting doesn't mean accounting for the same thing twice.
Somewhere closer to $4,000 per year is what is generally accepted as the cost of the child alone, excluding such externalities which are a real cost, but reasonably accounted for elsewhere. This brings you back into the black with some money to spare.
Note, even the $4,000 (average yearly cost over 18 years) includes childcare costs. This means the typical parental unit should be able to double its income expectations from what you have presented. If one parent is foregoing an income to care for the child, then $4,000 would be reduced.
According to Statscan, the average woman is 29 years old when she has her first child. For the sake of discussion, we will assume the partner is of the same age.
Employment regulation varies by province, but generally one is expected to start working at the age of 14 and somewhere around 20 hours per week. There is a legal expectation of being under the care of an adult for those first four working years, which means it is, for all intents and purposes, pure profit.
If we assume a youngster is paid $10 per hour, that is $7,500 after tax each year. If we assume a 3% interest rate, that leaves one with around $50,000 in hand by the time they have their first child even if no further saving takes place after turning 18. But it takes two to tango, as they say, so actually a combined $100,000 is available.
Even if your family really is haemorrhaging $2,000 per year once you turn 29, you still have 50-some-odd years of runway. You could quite possibly have great grandchildren by the time you run out of money at that burn rate.
There is capital benefit to housing and automobiles, so debt may be justifiable there, but you have already included those payments in your earlier figures. What other debt could there possibly be? The average Canadian isn't starting a business and your cashflow figures are positive before the child comes along. No need to account for the same thing twice.
While I agree the answer to the issue is the solution. As I noted it doesn't seems like people agree on the issue.
So what is wrong with a declining population, anyway?
An increasingly aging population. Less money from taxation to fund services, decreasing standards of living, more people dependent on a decreasing number of income earners, being in a nursing home without anyone available to care for you etc
A death spiral unless we can somehow manage to grow economically to compensate but even then the social outcomes arent great either.