Remember when the economy was growing nicely in the first quarter of the year and everyone was excited? Now the economy has stalled and we have net job losses in July! What’s the problem you ask?
We learned that over 50% of the recovery from 2009 was a result of a strong real estate market. You know the basics: construction, renovations, sales, and all the ancillary services from legal to moving services, appliance sales etc. Toronto has some of the best condo developers and real estate brokerage companies in North America. But apparently the people who know best thought that this recovery was not good for Canadians, so they decided to kill off the real estate market! That way Canadians won’t have to worry about a possible real estate bubble and we will all be better off.
The Feds introduced new lending rules making it more difficult to get a mortgage. Then they jacked up bank interest rates. The Province jumped in with the HST – a tax on everything from new house sales to all the services we use in real estate. And guess what? They succeeded. Now we have no economic recovery! Perfect. My question is: are we better off? We don’t have to worry about real estate prices escalating out of reach because less Canadians have jobs, and we have taken more money out of our pockets.
Maybe we should just have left things the way they were at the start of the year!!