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The Cole's Notes version is that yeah, it didn't affect a lot of people (let's say 1,000) but it had a huge impact. Due to commitments to buy and lower sales prices (in one case I know of 30% below asking) these thousand families have hundreds of millions more in mortgage debt. That's going to have a massive impact on the economy in a very local geographic area.

And..

I stand by that this hurt Canadians more than foreign investors.

A good summary - but it is important to also talk about who benefits from the changes in policy - and clear that has the potential to be a much larger group of people.

Either the tax won't have any effect - in which case the government can raise the rate and start to collect a massive amount of new revenue - which can be used to either lower income & sales taxes or increase spending on social programs.

or

Prices will revert back to being connected to local income levels - in which case the market will become more accessible to working families without creating massive debt loads.

In terms of policy - this seems like a winner.

Even if they drop 30% across the board is it the foreign investor who is hurt?

A 30% drop in prices only wipes out the very recent gains; thus the number of people impacted is very small.

tecmo
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