Canadian real estate prices will continue to soar, says Montreal Economic Institute

toronto-condo

A new report by ACORN called the Inclusionary Zoning In Toronto is suggesting the City of Toronto to look at making use of Inclusionary Zoning to set aside up to 30 percent of new units for affordable rental housing.

According to ACORN, there are now 81,000 households on waiting lists social housing, with over 20 percent are spending over 50 percent on rent.

“These measures just drive up the prices of the other units, making them less affordable for the middle class,” says Miguel Ouellette, the director of operations at Montreal Economic Institute (MEI). “The supply of new properties is not rising as quickly as the demand.”

“One solution would be to build more housing… which means more flexible zoning rules and an end to regulations aiming to impose the construction of social housing in residential towers,” says Oullette.

MEI’s latest report on Canadian real estate aligns the Conservative agenda and another reports the Frontier Centre for Public Policy in that is states that high prices on land slows development.

MEI economist Olivier Rancourt says the hot real estate sector in Canada on a “federal government stimulating prices” with “extremely low interest rates” and “municipal governments slowing the construction of new housing,” which is creating a situation he calls “very difficult for the middle class.”

The average house price in Vancouver is $1.7 million , while Toronto is now over $1 million and Montreal is below $500,000.

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