OPTIMISM, SKEPTICISM & CYNICISM

I am generally an optimist. But lately, the state of the world has had me a bit cynical. Or skeptical?

And it’s got me thinking – what is the difference between sceptical and cynical? So, I did what everyone does today and asked the great Google.

The Associated Press Stylebook has a simple differentiation:

“A skeptic is a doubter. A cynic is a disbeliever.” The next step after “cynicism” is becoming “jaded.” Where “cynics” might be sneering and actively doubting something, people who are “jaded” are just so exhausted that they have become apathetic.

It’s an election year in Ontario, and the posturing and positioning associated with the provincial and municipal elections has already begun.

I think you know where I’m going with this…

Next to the pandemic, real estate has been a major topic of discussion in recent years. Market conditions in Ontario, and Guelph in particular, have been very robust for a long time now. Steady annual growth in prices for a couple of decades, and then the explosive growth during the pandemic.

We all know that the sound bites and position papers will focus on real estate and the market during this election cycle. It will be the low hanging fruit for politicians, and will be an easy distraction from the larger issues – like our healthcare system. That’s not to say real estate isn’t an important issue. But the skeptic in me suggests that those seeking election are more interested in winning than actually tackling the challenge of such a complex and multi-pronged problem the current real estate market presents.

I can’t help but think back to the time that Canada’s first and only woman prime minister Kim Campbell was campaigning for re-election and suggested that an election was “no time to discuss serious issues”. Even as she claimed that quote was misinterpreted, what she was referring to was that 47 days wasn’t long enough to get into discussing serious issues. I believe most reasonable politicians would abide by that sort of statement, because it’s usually impossible to break down a serious issue into neat little sound bites or quotes.

This, of course, won’t stop them from throwing ideas at the problem in hopes of gaining some traction and media attention.

It has already started with Wednesday’s announcement that the provincial foreign speculators tax will now be 20% and apply to the entire province.

Low hanging fruit, and minimal impact at best, while giving the government a non-voting boogeyman to point the finger at.

I’m cynical that politicians will come up with a solution that will have long term benefits for buyers and sellers. They will propose and impose rules and restrictions to sledgehammer the problem. However, chances are the problem – sky high prices – is already being addressed by the market, as March has been an unusually slow month for the spring market.

I’d be interested to see a detailed discussion around how we deal with blind bidding, and perhaps look at a cooling off period as British Columbia is. Both of these would address the problem of over bidding when in competition for homes. However, neither will address the issues around the supply of homes and the process involved in creating more housing stock.

The municipal governments control the zoning and permitting process, yet the provincial government is wanting to push changes in these municipal matters. Meanwhile, the Feds are sticking their nose into their provincial cousin’s business in wanting to ban blind bidding. Throw in issues around the privacy act (and its impact on disclosure around bidding) and you can see how many political silos and fiefdoms are impacted.

This leads me to my jaded response: that the market will eventually solve this issue as interest rates rise, buyers become more reluctant to compete and over bid, and the greed slowly bleeds out of the market.

Yet, I’m an optimist!

Collectively, let’s pay attention to what the politicians put out in this election cycle and get engaged. If we want our kids and grandchildren to be able to build wealth through real estate and have a comfortable place to live, we need to be engaged, open to new ideas, and keep all the levels of government on task and focused on long term solutions instead of short term politically expedient bandaids. We can and will find solutions that make the real estate market accessible to those that want in, but that work has to be done from the court, not the sidelines.

THE PAST WEEK IN THE GUELPH REAL ESTATE MARKET

Take a look at the full key week comparison:

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