Comment 64739

By A Smith (anonymous) | Posted June 08, 2011 at 17:28:15 in reply to Comment 64726

>> what do the laws of Supply and Demand say we should do in this case? Lower prices?

Exactly, we should scrap development charges. As you can see, as these charges have increased, housing starts in Hamilton have fell.

2005 - 1,683 0.0032/resident, $2.35M development fees
2006 - 1,407 $3.76M
2007 - 1,207 $382K
2008 - 1,146 $27.99M
2009 - 742 0.0014/resident, $11.1M,

Here are the numbers for Toronto...

2005 - 15,602
2006 - 12,726
2007 - 8,854 0.0032/resident
2008 - 19,710 0.0072/resident
2009 - 11,919 23.6% drop off from 2005-09, 56% for Hamilton.

Notice the per capita new housing starts. From 2005-09, Toronto's worst year (2007) tied Hamilton's best year (2005).

From 2005-09, Toronto had a total of 68,811 new housing starts, Hamilton had 6,185. If you assume we are 5X smaller than Toronto, we should have had around 13,600 new homes built. Instead, we had only 45% of that number.

Curiously enough, residential tax rates in Hamilton are almost double that of Toronto, while development fees are around 80% higher.

Ask yourself why Walmart is so successful? It's because it keep prices low for consumers. If the City of Hamilton ever clues into this winning formula, we may catch up to Toronto, or even surpass it as the place to live.

Or, we could follow the high tax Detroit model and watch as entire city blocks pick up and leave for greener pastures.

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