If your government creates artificial demand - that's a demand problem.
The demand isn't real. It's synthesized from unsustainable government policies.
Set interest rates to -100% - see what happens to housing demand.
Is that a supply problem? Should Canada build 800 trillion houses to fill the appetite for free government money that will eventually implode? Or is it a demand problem because your government is dumb?
I don’t understand. This theory implies that a significant percentage of Canadian houses are empty due to speculation. Is there any evidence for that theory?
Looking a bit online it feels like this might be a disproven theory https://financialpost.com/real-estate/busting-the-myth-of-ca...
Also just on a very fundamental level - outside of luxury housing, why wouldn’t investors rent out the houses they’re sitting on? Sure it’s nice to own an appreciating asset but isn’t it also nice to rent it for 10% of its value yearly?
They didn't say they are empty?
Most investors aren't keeping their properties empty. The empty places are generally owned wealthy people as a second/third home, or as means for foreigners to offshore their wealth. And this accounts for a tiny fraction of the housing supply compared to domestic/corporate real estate investors.
The demand is absolutely real. People are actually buying these properties. The prices are subsidized by government policy. Instead of fixing the supply side of the equation, Canada has decided to give away money so cheaply that normal people can afford the obscene prices for real estate. Interestingly, increasing the number of people that can afford a house without changing the supply makes prices go up. Who knew?!
Immigration is the natural effect of people moving to where the market price of labor “demands” they move. Doesn’t seem that artificial.
What? The market price of labor always 'demands' that it be lower... literally import millions of 3rd world immigrants into any first-world country and you will see housing shortages, infrastructure shortages, wage decreases/stagnation, and increased corporate profits.