The Canadian FEDERAL Government Via The CMHC created a massive Problem for Renters: Residential Tenancies Branch will start saying no to landlords who push for rate hikes – April 10, 2021,

Canada in the modern era has created a favorable environment for housing market speculators who wish to buy, hold and flip their properties. The story below is a perfect example as to why Rent prices are so high in almost every Canadian city during a deflationary period.

As most Canadians know, wages have been stagnant, now I argue wages are stagnant because technology has LOWERED the cost of living. Unfortunately, Canadians many of whom subscribe to Keynesian economics prefer a big government, and this expensive big government has during deflationary periods artificially raised the cost of living.

To pay for this big expensive government, the Canadian government borrows and spends. To get votes, most Canadian politicians will push for more regulations, this expensive method of governing leads to the government having to find creative ways to pay for these radical ideas.

The most common way to pay for these big government ideas is to lower the value of the Canadian dollar and of course tariffs, duties, and taxes. The last way to pay for big government is propping up asset prices, whether it’s stocks or real estate providing an incentive to protect investors from investment deflation is a tool the Canadian government uses to make and keep the cost of living higher than it needs to be.

Oh yes before I forget the carbon tax is basically an energy tax to be privileged enough to do business in Canada. All of these frivolous big expensive government ideas hurt the poor the most, because as an example why would I build housing for the poor in the form of rental housing when I can build a Condo?

The CMHC and the Bank of Canada two federal crown corporations are competing with Provincial and municipal governments, many of whom have some form of rent control. A rent control is very similar to a minimum wage in that your business via government regulation is actually in business with the government.

If you as a landlord evict tenants in a manner not suitable to the government or if you raise your rent in a manner that the government doesn’t like, you can either have your property seized/nationalized or your property will be subject to government action that more than likely won’t be favorable to you.

 

Now, if you compare this to what CMHC is offering which is basically, build condos and pass the financial headache (via strata fees instead of rents) to the owners of the condo units, which one would you choose as a developer of housing?

Most people if given the option would prefer renting over owning in a MARKET economy. But what we have now is not a market economy, because people are literally being subsidized by the government to be homeowners! Now, as an investor as a developer building condos instead of Rental housing makes a lot more economic sense in today’s Canada.

If I were a developer, I’d build condos instead of rental housing and if condos are being built instead of rental housing, renters have fewer options, which ultimately equates to higher rent prices. I like to argue that if most of these condos being built were rental housing the poor and middle class in Canada would be living in the best era in Canadian history.

In Toronto, as I’ve been arguing for years, about 40% of the condo units are EMPTY! Speculators merely waiting for their chances to sell into a hot housing market, and who can blame them? This problem wouldn’t even exist had it not been for CMHC becoming involving itself in mortgage insurance and the Bank of Canada artificially lowering interest rates when Canada hasn’t had a housing crash in almost 30 years.

The story below is merely the end result of the Federal Governments over-reach and no this is not a Justin Trudeau created problem, this problem stems back to Paul Martin’s regime, who are the architects of our current corporatist system, which I believe Justin Trudeau is likely to unintentionally destroy!

The problem with rising asset prices is the poor and middle class eventually get consumed by it, because the only tax collection that matters is the tax collection derived via the private sector. If you don’t understand the relationship the private sector has with trade deficits, you don’t understand what led to the destruction of Venezuela’s economy.

Now I don’t expect things will get as bad in Canada as they did in Venezuela, but when you demonize the private sector, you’d better have a better viable and sustainable alternative!

Below is the Manitoba government stuck in a balancing act, I’m sure the Conservative Premier understands the problem but he has to lie because Canadians including many CONSERVATIVE voters have brainwashed into believing that big government works and a market economy is just plain evil! As I’ve stated in a prior post, I will never be voting for the Conservative Party again.

I currently support the PPC and I’m open to the Libertarian Party of Canada. I will not continue to help cowards destroy the country I love.

Critics doubt Residential Tenancies Branch will start saying no to landlords who push for rate hikes | CBC

interesting times ahead!