Do high new home prices mean it costs a lot more to actually build a new home? No.
Recent international research shows that in countries with advanced economies, including Canada, the price of land has risen far, far faster than the cost of building a new home. High land costs are pulling prices higher.
The cost of land is highly influenced by the policies governments set for new housing development, and by the development-charge taxes they impose. In Canada, this is what drives new home prices up. It determines the type of new homes built, and where they are located. And it means that for many young people and families, owning a home in a child-friendly community is quickly slipped beyond their reach. We need to talk about this.
Affordability matters – to your children, to your community, and to Canada’s economy.