The Canadian Bitcoiners Podcast - Bitcoin News With a Canadian Spin - The Canadian Housing Crisis - CBP Quick Currents

Episode Date: April 11, 2025

Friends and enemies,This week on Quick Currents, we examine the Canadian housing crisis. When and how did Canada become a place where most cannot afford to own a home? Are boomers to blame? Or maybe banks? What sorts of issues have contributed to our real estate monetization, and what do we do next? Let's dive in.As always, none of the info is financial advice. Website: ⁠www.CanadianBitcoiners.com⁠Discord: https://discord.com/invite/YgPJVbGCZX A part of the CBP Media Network: ⁠www.twitter.com/CBPMediaNetworkThis show is sponsored by: easyDNS - ⁠⁠www.easydns.com⁠⁠ EasyDNS is the best spot for Anycast DNS, domain name registrations, web and email services. They are fast, reliable and privacy focused. You can even pay for your services with Bitcoin! Apply coupon code 'CBPMEDIA' for 50% off initial purchase. Bull Bitcoin - ⁠⁠https://mission.bullbitcoin.com/cbp⁠⁠ The CBP recommends Bull Bitcoin for all your BTC needs. There's never been a quicker, simpler, way to acquire Bitcoin. Use the link above for $20 bones, and take advantage of all Bull Bitcoin has to offer.

Welcome to CBP Quick Currents, the podcast sidekick to CBP where we do a quick review of an important topic. I'm Joey and today we're tackling one of the most pressing topics in the country. It is the housing crisis. It's a problem that's reshaping our cities, our politics, and our society from sky-high prices to generational and demographic divides. We're going to try and break this down into a few parts, understand what's going on, how this started, and see if we can't come up with a way forward.

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At its core, it's about affordability or the lack of it. Housing prices have soared beyond what most Canadians can reasonably afford. In 2024, the average home price in Canada was around $697,000 up from $453,000 in 2015. Huge jump in only a few years. In cities like Toronto and Vancouver, you're looking at averages closer to 1.2 or 1.3 million, respectively. For some perspective on that, median household income is about 82,000 a year, meaning that a typical family would need to spend over 14 times their annual income

to buy a home in these markets. That is double the ratio considered affordable. Then there's supply. Canada simply isn't building enough homes. The CMHC, Canada Mortgage and Housing Corporation estimates we need three and a half million additional homes by 2030 to restore affordability to early 2000s levels. In 2023, we built only 240,000 new units, far short of the 500,000 needed annually to close that gap. As we've joked about on the show, and as I just tried to highlight with my tone,

the other issue is the gap between what government hears when Canadians say they need more homes and what they actually build. For many, a home is a place to contribute to a community, start a family, get a dog, and grow. While for government, a home seems to be a door, an economic shelter unit where someone can rest in between shifts at their unfulfilling,

precarious minimum wage job, and consume widgets and propaganda. The gap between these two is enormous and growing. Demand is another issue. Canada's population grew by 1.2 million people between July 22 and July 23, largely driven by immigration, obviously. About 40% of newcomers settle in Toronto and Vancouver, where housing is already scarce. This influx, while vital to Canada's economy, apparently puts intense pressure on crowded urban markets,

drives up home prices and rents. For example, average rent for a one bedroom in Toronto hit $2,600 in 2024, up 10% from the previous year. And the crisis isn't just numbers. It's people giving up on home ownership, young families stuck renting, and newcomers struggling to find a foothold. So how did Canada get here?

To understand the roots of the housing problem, we should probably go back to 2008, when the global financial crisis hit. Unlike the US, Canada's housing market didn't crash during the GFC. Our banks were more cautious, quick to act, and the government leaned in with stimulus. They lowered interest rates to near zero and kept them there for years. This obviously made borrowing cheap, fueled demand for real estate, and that demand continues today in some respects. Home prices started climbing steadily. I won't mention who was leading the Bank of Canada at that time, but I suggest you look into that as well. Something else shifted around the same time,

though, and maybe as a result of these policies. Housing became more than a place to live, it became an investment. Baby Boomers, born between 46 and 64, saw real estate as a way to secure their financial future. By 2024, Boomers owned 41% of Canada's housing stock, despite being just 25% of the population. Many bought second or third properties, often as rentals or speculative investments.

Between 2016 and 2021, investors accounted for a whopping 33% of home purchases in some provinces, which obviously drove up prices. Low interest rates and investor demand created a feedback loop. From 2010 to 2020, home prices grew at around 6% annually, outpacing wage growth for the same period, which was only 2%. By the mid 2010s, cities like Vancouver and Toronto were already among the least affordable in the world. The pandemic poured fuel on the fire. Ultra-low rates and remote work pushed prices up 20% in 2021 alone. Over the past decade, this slow burn became a full-blown crisis with no easy fix in sight. This brings us to the generational tug of war going on in Canada. Younger Canadians,

we'll say the Millennials and Gen Z, face a brutal reality. In 2024, 90% of young adults under 35 said they believe they'll never be able to afford a home. For them, lower prices are critical for starting families, building wealth, and putting down roots. A 2023 survey found 60% of millennials have delayed having children due to housing costs, which remains the most popular defense for Canada's disastrous immigration policies and causes other issues as well. Boomers, on the other hand, have a different stake and a different point of view. Many rely on their home's value for retirement. The average boomer homeowner's

property is worth around $800,000 and is often mortgage free. Selling or borrowing against it funds travel, healthcare, passing wealth to their kids, and more. If prices drop 30%, as some younger folks hope, it could wipe out $240,000 of that nest egg. I don't think boomers are the villains here. They're responding and responded in the past to a system where pensions are inadequate. This is even more obvious following a five-year inflation impulse during and after COVID. And real estate as a result became their safety net. The tension between these groups is real.

Younger generations feel locked out while boomers feel their hard-earned wealth is at risk. It's not just economics, it's becoming emotional. And it's shaping how Canadians are seeing each other. Politics has also played a huge role in this mess. Since 2008, both conservative and liberal governments have shaped the housing issue in several ways. Under conservative PM Stephen Harper, low interest rates and lax oversight led investor demand soar.

The liberals who came into power in 2015 under Trudeau continued loose monetary policy and ramped up immigration. They targeted 500,000 newcomers annually by 2024 and didn't match housing supply. Their national strategy promised 100,000 affordable units, but delivered only 30,000 by 2023. Massive, massive under delivery. Voting patterns reflect this divide. Boomers who vote at about a 75% turnout compared to 53% for those under 35 often back policies preserving property values. Zoning laws that limit new builds, for example, and other NIMBY adjacent thinking. Younger, poorer voters lean toward parties promising

affordability, like the NDP, but their lower turnout dilutes their impact significantly. Enter the 2025 election coming up in a few weeks. Liberal leader Mark Carney and conservative leader Pierre Polyev both have different ideas about the housing crisis. Carney's plan focuses on supply, pledging $25 billion to double construction to 400,000 units a year by 2030. He's also pushing more tax breaks for first-time buyers and greener homes. Critics argue it's too slow. Ramping up construction takes years. And I argue that the government has a poor track record of building homes and building sustainable homes should not be the concern. It should be about quantity and speed rather than whether or not these homes meet a carbon target.

Poliez's building homes not bureaucracy plan is bolder on paper. He wants to ask the GST on homes under 1.3 million, a number we mentioned earlier in this discussion, saving buyers up to about $65,000. And he wants to tie federal funding to cities hitting 15% annual housing growth targets. He's also floated linking immigration to housing supply,

a nod to easing urban pressure. But skeptics question whether or not these tax cuts favor wealthier buyers over renters. Both leaders and both parties know housing is a top issue. As many as 47% of Canadians cited it as a key concern during a 2024 poll. This election could hinge on who voters trust to deliver on this portfolio. The housing crisis isn't just about money either. It's tearing a candidate's social fabric.

First, there's the boomer youth divide we've discussed, but it goes deeper. The rich, who own multiple properties, see their wealth grow. Canada's top 1% held 26% of real estate wealth in 2023. The poorer class, meanwhile, faced rising rents and homelessness, which jumped 20% in major cities from 2020 to 2024. Homeowners and renters are another fault line. Homeowners sitting on around $5 trillion in

collective equity often resist new developments to protect property values and guard community identity. Both obviously are becoming more difficult. Renters meanwhile paying 30% to 50% of their income on housing feel trapped. 60% of renters in 2024 said that they've given up on ever owning their own home. Then there's old stock Canadians versus immigrants. Some blame newcomers for crowding cities, ignoring that immigrants are sometimes victims of the crisis, paying $3,000 for cramped apartments, and we've all seen the videos of immigrants sharing rooms with enough other people to make a sardine can feel spacious. People with children face extra strain. Families need larger homes, but three-bedroom units are rare and costly.

Those without kids, often younger, feel they can't even start families because of housing insecurity. These divides breed resentment and it's resentment we've seen on social media. Twitter and other places are full of stories, young professionals leaving Canada, immigrants feeling scapegoated, and boomers feeling demonized. It's a fracture that threatens the inclusive Canada that we have prided ourselves on in the past, to be quite frank. Here's the hard truth though. No matter your politics or demographics, housing costs are just too high. The status quo where homes are speculative assets, not places to live,

isn't sustainable. Prices must come down, whether through smart policy or worse, an economic crash. Policies like taxing speculative investors, building millions of homes, or rethinking zoning could help, but it'll take courage to challenge entrenched interests. We are at a crossroads in Canada, and without action, we risk deeper inequality, stalled dreams, and a further fracturing of society. The housing crisis isn't just about bricks and mortar, it's about who we are, who we want to be,

and where we can be those people. That's it for today's Quick Current. If you enjoyed this deep dive, share it with a friend. These are meant to be easy to digest, shareable episodes that help spread the word about an issue that I think anyway, affects all of us. Until next time, take care.