Tuesday, December 09, 2008

Oh, come on.

Seriously? We all know that the housing market was a bubble market. It was going to burst sooner or later. And the CD Howe Institute is actually suggesting that it's Miller's land transfer tax that's responsible? Give me a break. We know that the CD Howe Institute is against taxes and in favour of the interests of large corporations, so it's no surprise that they're trying to tag Miller's tax with the inevitable decline in housing prices. It's hard to find out who the analyst (Benjamin Dachis) actually is, but a quick Google search reveals that he is a contributor to the National Post and the Financial Post -- not exactly what you'd call an impartial observer.

I'm not enough of an economist to tell if his analysis is actually right or not (the study is here (.pdf)). I will note that the study appears to only compare Toronto to its surrounding suburbs, and those only within 10 km of the Toronto border (which would leave out, say, Aurora and Newmarket). There doesn't seem to be a comparison to other major cities in Canada (such as Vancouver and Calgary, which have also experienced serious declines in housing prices), nor to Ontario as a whole.

Overall, I find the source extremely suspicious, which leads me to suspect the conclusion is faulty. And the problems I have identified suggest that the analysis is too limited to be worth taking seriously.

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