The Case Of The Toronto Housing Market

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Recommended: Cocktail party economics concepts

The housing market is very unique as unlike other goods and services, houses have permanence, it is a fixed location good causing the rules of supply and demand to be taken to new extremes. In the case of the Toronto housing market we can view in almost real time the role supply and demand play on he ever increasing house prices, additionally the fundamental economic issue of scarcity is made extremely apparent by the limited size of the city of Toronto.
In the early chapters of Cocktail Party Economics, the foundational economic concept of scarcity is brought up as a handful of statements: “a good man is hard to find” or “there’s not enough time in the day” (Pg. 8). What do good men, time and houses in Toronto have in common? All three of these scenarios have some variable or element that is beyond a consumers control, regardless of how hard you try or how much work you put in there will never be more than 24 hours in a day on earth, you can’t change the supply of good men (though that’s a matter of perspective) and regardless of how much you want it the supply of houses or the spac...

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