Canada Housing/Debt: Trust me, I'm a landlord.

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

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leftist heap: Feb 28, 2013; Fun Shoe

I wanna know which of the banks is handing out $500k mortgages to fresh grads on a work permit.

# ? Aug 16, 2016 16:12

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# ? Jun 1, 2024 23:47

Postess with the Mostest: Apr 4, 2007; Arabian nights
'neath Arabian moons
A fool off his guard
could fall and fall hard
out there on the dunes

leftist heap posted:

I wanna know which of the banks is handing out $500k mortgages to fresh grads on a work permit.

Why wouldn't the banks give out mortgages that CMHC will insure?

https://www.cmhc-schl.gc.ca/en/hoficlincl/moloin/hopr/upload/CMHC_Newcomer.pdf

# ? Aug 16, 2016 16:22

sbaldrick: Jul 19, 2006; Driven by Hate

RBC posted:

this is literally how the us housing crash happened. i guess its less bad on a small scale with cars

No one can really wants to bail out the automakers again as people are too stupid to figure out how many people they employ. Which is the real reason the subprime stuff is bad.

# ? Aug 16, 2016 16:41

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

quote:

http://www.cbc.ca/news/canada/british-columbia/property-transfer-tax-chinese-student-1.3719106?cmp=rss

University grad faces $84K foreign buyers tax on Langley, B.C., townhome

'I can't go forward and also can't go back,' says University of Saskatchewan grad

After completing her degree at the University of Saskatchewan last spring, Chinese student Jing Li decided to put down permanent roots in Canada.

Jing, 29, obtained a work permit, moved to the Vancouver area and made an offer on a townhouse in Langley, B.C., in mid-July.

"The beauty and kindness of B.C. inspired me to move here," she said.

Jing cobbled together a 10 per cent deposit on the $560,000 property by borrowing from her parents in China. She said they in turn borrowed money from friends and family.

But last month, 12 days after Jing signed the purchase contract, the B.C. government threw a wrench in Jing's Canadian dream when it levied a 15 per cent property transfer tax on foreign real estate buyers in the Vancouver area.

Jing is not a permanent resident in Canada, so the tax adds $84,000 to the home's cost, something she's certain she can't afford. But if she backs out of the deal, she would lose her deposit of about $56,000.

"Now, I can't go forward and also can't go back."

Her mother cried when Jing called her parents in China to tell them about the tax. They had no more money to lend her.

Jing said her father is a geologist for a mining company. Her mother stays at home.

Parents saved for Jing's future

She said her parents saved all their lives to send her to university in Canada.

After earning a master's degree last spring in public administration from the University of Saskatchewan, she moved to Burnaby, B.C., where she lives in an apartment with some university friends.

Staying in Canada was Jing's idea, and now she feels guilty.

"I think this is my fault," she said in halting English. "If I don't want to study, work and live in Canada, this disaster would not happen to my family.

"I hope there is somebody could tell me what I can do."

Bruce Copp, managing broker at Sutton Group West Coast, the real estate firm used by Jing, confirmed Jing made the offer on the Langley property in July.

Did not expect tax

When the government introduced the tax last month, it said its stated aim was to make housing more affordable for middle-class buyers.

Real estate prices in the Vancouver area have soared in recent years. Some have argued that foreign buyers have contributed to this rise, which has left many local buyers priced out of their own city.

Jing said she never would have bought the Langley property had she known a tax was on the horizon.

She said she felt entrapped by the government when it announced the tax.

"In my mind, Canada is a democratic and fair country."

Now she is not so sure.

# ? Aug 16, 2016 17:02

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

The story so nice it got posted twice!

# ? Aug 16, 2016 17:06

Lexicon: Jul 29, 2003; I had a beer with Stephen Harper once and now I like him.

, they changed the title. It was originally

University grad inspired by 'beauty and kindness of B.C.' faces ugly $84K foreign homebuyer tax

:ohdear:

# ? Aug 16, 2016 17:08

Monaghan: Dec 29, 2006

So the tax somehow makes Canada an undemocratic country now?

# ? Aug 16, 2016 17:12

Tsyni: Sep 1, 2004; Lipstick Apathy

Monaghan posted:

So the tax somehow makes Canada an undemocratic country now?

Imagine all taxes had to be approved by referendum.

# ? Aug 16, 2016 17:19

Subjunctive: Sep 12, 2006; ✨sparkle and shine✨

Tsyni posted:

Imagine all taxes had to be approved by referendum.

I just got back from California, no thank you sir.

# ? Aug 16, 2016 17:28

Brannock: Feb 9, 2006; by exmarx; Fallen Rib

Monaghan posted:

So the tax somehow makes Canada an undemocratic country now?

No taxation without representation!

# ? Aug 16, 2016 17:36

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

Lexicon posted:

, they changed the title. It was originally

University grad inspired by 'beauty and kindness of B.C.' faces ugly $84K foreign homebuyer tax

That's still showing up on RSS feeds

# ? Aug 16, 2016 17:57

leftist heap: Feb 28, 2013; Fun Shoe

Ikantski posted:

Why wouldn't the banks give out mortgages that CMHC will insure?

https://www.cmhc-schl.gc.ca/en/hoficlincl/moloin/hopr/upload/CMHC_Newcomer.pdf

quote:

Newcomers with non-permanent resident status have access to CMHC-insured financing of up to 90% loan-to-value ratio for the purchase of a 1 unit owner-occupied residential property

lmao. The CHMC is so full of little nuggets I never think about. We're insuring the mortgages of people who aren't even PRs because why not? It really wouldn't surprise me at this point to learn that the CHMC has a loophole to insure mortgages given to pets or something.

# ? Aug 16, 2016 18:25

Freezer: Apr 20, 2001; The Earth is the cradle of the mind, but one cannot stay in the cradle forever.

drat, that's a sweet deal, it's like gambling with (mostly) someone else's money. If things go well, you can rack up a ~500% profit in a few years, and if things go to poo poo, just walk away and let the Canadian government on the hook for 80-90% of the property's former value.

Should have got into this racket years ago though, looks like the music will stop soon.

# ? Aug 16, 2016 18:46

leftist heap: Feb 28, 2013; Fun Shoe

Freezer posted:

Should have got into this racket years ago though, looks like the music will stop soon.

Really? Cause nobody at any level of government has said a word about anything remotely macroprudential related. The province can't do poo poo and the Liberals haven't said a single thing of substance related to the housing market. gently caress, at this point Jim Flaherty has done more to cool the market than any other legislator and that was only after massively inflating it with 40 year mortgages.

# ? Aug 16, 2016 20:02

leftist heap: Feb 28, 2013; Fun Shoe

Also anecdata time: two of my coworkers have been recently owner occupied evicted the the past three months. Never met someone who had been renovicted in the 5+ years I've been in Victoria.

Victoria also saw the highest price gains in the country in July. Right around when the BC Libs announced their Vancouver-only foreign buyer tax. Could just be a coincidence.

# ? Aug 16, 2016 20:05

MeinPanzer: Dec 20, 2004; anyone who reads Cinema Discusso for anything more than slackjawed trolling will see the shittiness in my posts

leftist heap posted:

Also anecdata time: two of my coworkers have been recently owner occupied evicted the the past three months. Never met someone who had been renovicted in the 5+ years I've been in Victoria.

Victoria also saw the highest price gains in the country in July. Right around when the BC Libs announced their Vancouver-only foreign buyer tax. Could just be a coincidence.

Also anecdata, but talking to friends around Victoria while visiting family these last few weeks has made clear that the market is currently undergoing some weird shifts. I too had never heard of renovictions before, but now I've heard of a few, and another friend who moved rental units in the last few months had some weird issues with landlords doing shady stuff. There's a lot of talk about a mini-bubble emerging on the Island.

# ? Aug 16, 2016 20:32

quaint bucket: Nov 29, 2007

Powershift posted:

in 2006 fresh out of university they were putting $5,750 into savings every month, by 2011 they were putting $10,575 into savings every month. So they're putting more into savings monthly than the median family pre-tax income fresh out of university.

Jesus, their 2011 savings/month is $2k more than my current monthly take home.

I'm glad they took advantage of their situation and maximize it to the fullest potential.

# ? Aug 16, 2016 21:23

Juul-Whip: Mar 10, 2008

quote:

Another major problem is when landlords issue a two-month eviction notice, but the landlord doesn't follow through on what they said they were going to do, he explained.

For example, he said, some renters move out only to see their suite listed online for a higher price.

Sakamoto said tenants can challenge their landlord if this occurs � and get two months' rent as compensation � but only if they put in the time and effort to pursue a claim.

One way to eliminate landlords acting in bad faith, he said, is for the provincial government to reverse the onus: make landlords have to apply for the notice from the Residential Tenancy Branch.

"[They would] show them the permits that they have, explain to them the nature of the renovations and show that they are extensive enough to require vacant possession."

Landlords would be able to obtain a notice only after proving this, he added.

Nah bruh, the real problem is TROUBLESOME TENANTS :argh:

# ? Aug 16, 2016 21:50

Baronjutter: Dec 31, 2007; "Tiny Trains"

Yeah, a few of my friends have been renovicted in Victoria. I think a big part of it isn't just the bubble and greedy landlords, it's that a huge portion of Victoria's rental stock was built en masse 40-50 years ago with absolutely nothing new built in between, and they're all coming up at the same time at the end of their lives. Due to my work I'm fairly familiar with the condition of a lot of these apartments, and what work is being done to them. Rents are skyrocketing and these old lovely wood frame apartments are nearing the ends of their lives and need major renovations, put those together and you have the perfect storm for renters getting renovicted on a large scale.

Even just 5 years ago a lot of the landlords I'd talk knew they'd have to do major renovations within the next decade, but it was hard for them to financially justify it. Now that rents are way up it's finally rewarding owners to do the renovations the building absolutely needs. It's lovely for us renters but I've yet to see a major case where the renovations are being done strictly to kick everyone out so they can double the rent or what ever. The big gently caress up was just not building any rental stock for a good 40 years or so, it's like this huge demographic/generational time bomb we created in terms of the housing cycle.

People go on about how there's an "explosion" of rental towers going up in Victoria that will surely address the supply problem, but no one has any sense of scale. They see a couple mini-towers and think it's a forest of skyscrapers. Each one of those towers has ~100 units in it, that's a drop in the bucket. There's about 25,000 purpose built rental units in Victoria, adding a couple hundred is nice but it's not going to suddenly make housing affordable. House prices are way more complex than supply and demand, but for the most part rental is very much just supply and demand. Victoria needs way more rental units, and an actual long term plan so we don't just build another glut of stock then nothing for 40 years. Also maybe actual rights for tenants, a good start would be making those self-terminating 1 year leases illegal. When one weird trick on your lease agreement throws 90% of the tenancy act out the window what's the loving point?

# ? Aug 16, 2016 22:00

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Having lovely tenants is probably the logical result of a culture which strongly discourages long-term rental vs. home ownership. Fix that, and I'm sure the "average tenant" would be way better behaved and less likely to wreck poo poo.

# ? Aug 16, 2016 22:03

Juul-Whip: Mar 10, 2008

Well-behaved tenants get renovicted regardless any of that, so the regulations governing that should be beefed up as well. (They won't be)

# ? Aug 16, 2016 22:55

quaint bucket: Nov 29, 2007

I bought a place because I got tired of playing Russian roulette with landlords not being a complete shitlord.

I had an amazing landlord in Burnaby who was had a good working relationship with us and was actually pretty understanding and quick to respond to any deficiencies.

Then my last two landlords were complete loving idiots and now dealing with an ex landlord who's trying to seize my damage deposit and get money for utilities from me (after repeatedly asking for it to be transferred to my name because utilities company wouldn't do it without landlord permission). Now I'm looking for legal advice and filing disputes. Great times.

# ? Aug 17, 2016 00:03

cowofwar: Jul 30, 2002; by Athanatos

Passive income!

# ? Aug 17, 2016 00:12

leftist heap: Feb 28, 2013; Fun Shoe

Baronjutter posted:

Yeah, a few of my friends have been renovicted in Victoria. I think a big part of it isn't just the bubble and greedy landlords, it's that a huge portion of Victoria's rental stock was built en masse 40-50 years ago with absolutely nothing new built in between, and they're all coming up at the same time at the end of their lives. Due to my work I'm fairly familiar with the condition of a lot of these apartments, and what work is being done to them. Rents are skyrocketing and these old lovely wood frame apartments are nearing the ends of their lives and need major renovations, put those together and you have the perfect storm for renters getting renovicted on a large scale.

Even just 5 years ago a lot of the landlords I'd talk knew they'd have to do major renovations within the next decade, but it was hard for them to financially justify it. Now that rents are way up it's finally rewarding owners to do the renovations the building absolutely needs. It's lovely for us renters but I've yet to see a major case where the renovations are being done strictly to kick everyone out so they can double the rent or what ever. The big gently caress up was just not building any rental stock for a good 40 years or so, it's like this huge demographic/generational time bomb we created in terms of the housing cycle.

People go on about how there's an "explosion" of rental towers going up in Victoria that will surely address the supply problem, but no one has any sense of scale. They see a couple mini-towers and think it's a forest of skyscrapers. Each one of those towers has ~100 units in it, that's a drop in the bucket. There's about 25,000 purpose built rental units in Victoria, adding a couple hundred is nice but it's not going to suddenly make housing affordable. House prices are way more complex than supply and demand, but for the most part rental is very much just supply and demand. Victoria needs way more rental units, and an actual long term plan so we don't just build another glut of stock then nothing for 40 years. Also maybe actual rights for tenants, a good start would be making those self-terminating 1 year leases illegal. When one weird trick on your lease agreement throws 90% of the tenancy act out the window what's the loving point?

And yet there is basically zero talk about adding a meaningful amount of rental stock. Council is already patting themselves on the back for the tiny amount of expensive rental buildings they've already added. It's pathetic that virtually every rental building in the city is almost 40 years old. But hey, better let 10 more lovely condo buildings go up so tin-pot dictator ~*investors*~ can play landlord on a bunch of one bedroom units.

It doesn't help that the surrounding municipalities have zero desire to add new rentals. Saanich and Oak Bay in particular have zero desire or incentive to add rental stock. It needs to be handled at the CRD level but they will never cooperate to that extent.

# ? Aug 17, 2016 00:29

meatcookie: Jun 2, 2007

Meanwhile, the West Shore is openly fellating every developer they see and eliminating greenspace at an unprecedented rate.

# ? Aug 17, 2016 01:58

leftist heap: Feb 28, 2013; Fun Shoe

meatcookie posted:

Meanwhile, the West Shore is openly fellating every developer they see and eliminating greenspace at an unprecedented rate.

Gotta build up for when that LRT finally gets built!!

# ? Aug 17, 2016 02:35

leftist heap: Feb 28, 2013; Fun Shoe

There must be a mandate to write as many of these articles as possible. That foreign money runs deep :tinfoil:

http://www.theglobeandmail.com/news/british-columbia/coquitlam-familys-home-sale-in-doubt-in-wake-of-bc-foreign-buyers-tax/article31437442/

quote:

Cardboard moving boxes are piled about the living room of an otherwise half-packed house nestled on a tree-lined residential street in a quiet Vancouver-area suburb � a scene frozen in time that the home�s owners blame on British Columbia�s controversial new tax on foreign buyers.

The in-transition state of the house in Coquitlam has been the status quo ever since its owners learned the house�s sale, which they understood was a done deal, was thrown into question by the tax.

The couple is at risk of losing an $80,000 deposit they made to purchase a smaller duplex further east in the city, and reneging on the real estate contract would also open them up to being sued.

�We feel like we�ve been let down,� Heather Nyberg told reporters Tuesday in the family�s small backyard as the couple�s two young children, aged 1 and 3, played together in the grass.

�I just feel really disappointed that our family and many, many others like ours are being affected by a poorly planned tax that�s unfair because it�s retroactive.�

The B.C. government has said the 15-per-cent tax is aimed at addressing skyrocketing real estate prices in Metro Vancouver, the province�s most densely populated region. The levy came into effect Aug. 2, days after it was announced, sparking a frenzy of last-minute activity as buyers and sellers rushed to close deals.

The couple sold their house earlier this year, but the deal isn�t slated to close until Sept. 15.

Housing Minister Rich Coleman said in an e-mail that the initial adjustment period may be difficult, but the tax will eventually reduce demand from foreign investors until supply catches up to local needs.

�This transition period is expected to be short-lived, and over the long term the additional property-transfer tax will help to ensure British Columbians can continue to raise their families in Metro Vancouver communities,� he said.

Ms. Nyberg�s husband, Dan Zimmermann, said the new law has put the couple under a lot of strain and uncertainty, which defeats the purpose of selling it in the first place.

�All we wanted to do was reduce the stress and reduce the size of our mortgage, and all of that�s been thrown up in the air now,� he said, adding that the change was also designed to allow them to spend more time with their children. �We made the best decision with all the information we had at the time, and that�s all we can do.�

Ms. Nyberg said if the sale of the house they bought three years ago falls through, they would likely have to back out of buying the new property because they can�t afford two mortgages.

�I�ve stopped packing. I don�t want to move into a duplex then move back three days later. Until we get more information, we can�t really make a plan,� Ms. Nyberg said. �We are just really stressed out. We�d been doing these weekly drive-bys of our new place so my son can get used to it. We�re really excited to join a new community where there are more families. We had been setting up our lives to move and now we don�t know what�s going on.�

Jodie Wickens, an Opposition NDP politician who represents the area in the legislature, said she receives dozens of calls and e-mails every day from people affected by the tax.

�I think that families that entered into a contract with an understanding shouldn�t be unfairly penalized,� she said. �To be impacted by this bill in such a negative way is unfair and unnecessary. It�s not putting British Columbians first at all. It�s a reactionary way to deal with bad headlines.�

I don't even understand how it is that this family is hosed? Presumably the buyer of their house has placed a deposit, so... sue for the deposit if they back out and then still make a huge profit on your house? I don't understand the sob part of this sob story.

# ? Aug 17, 2016 02:56

cowofwar: Jul 30, 2002; by Athanatos

Why would anyone give a gently caress about foreigners getting burned while trying to speculate? lovely news rags.

# ? Aug 17, 2016 02:59

Femtosecond: Aug 2, 2003

leftist heap posted:

And yet there is basically zero talk about adding a meaningful amount of rental stock. Council is already patting themselves on the back for the tiny amount of expensive rental buildings they've already added. It's pathetic that virtually every rental building in the city is almost 40 years old. But hey, better let 10 more lovely condo buildings go up so tin-pot dictator ~*investors*~ can play landlord on a bunch of one bedroom units.

It doesn't help that the surrounding municipalities have zero desire to add new rentals. Saanich and Oak Bay in particular have zero desire or incentive to add rental stock. It needs to be handled at the CRD level but they will never cooperate to that extent.

I googled around for like 10 minutes and found nothing, but I am under the impression that municipalities don't have the power to zone to restrict residential use to purpose built rental only. Does anyone know?

# ? Aug 17, 2016 03:00

computer parts: Nov 18, 2010; PLEASE CLAP

Femtosecond posted:

I googled around for like 10 minutes and found nothing, but I am under the impression that municipalities don't have the power to zone to restrict residential use to purpose built rental only. Does anyone know?

The only thing I'm seeing is for short term rental properties (the stuff that AirBnB tries to ignore). Other than density, you presumably can put an apartment down anywhere you can put down another residential building.

# ? Aug 17, 2016 03:17

ocrumsprug: Sep 23, 2010; by LITERALLY AN ADMIN

quaint bucket posted:

I bought a place because I got tired of playing Russian roulette with landlords not being a complete shitlord.

I had an amazing landlord in Burnaby who was had a good working relationship with us and was actually pretty understanding and quick to respond to any deficiencies.

Then my last two landlords were complete loving idiots and now dealing with an ex landlord who's trying to seize my damage deposit and get money for utilities from me (after repeatedly asking for it to be transferred to my name because utilities company wouldn't do it without landlord permission). Now I'm looking for legal advice and filing disputes. Great times.

Just file the claim. It is highly unlikely the landlord submitted all the paperwork required to keep your damage deposit.

If he didn't submit the paperwork within the filing deadline (it's like 10 days) you get it back, even if you torched the place.

# ? Aug 17, 2016 03:17

MeinPanzer: Dec 20, 2004; anyone who reads Cinema Discusso for anything more than slackjawed trolling will see the shittiness in my posts

cowofwar posted:

Why would anyone give a gently caress about foreigners getting burned while trying to speculate? lovely news rags.

It's amazing that newspapers are pumping out these articles and expecting Canadians who read them to give even a single gently caress. I've even heard my parents, who are usually pretty mild about a lot of this stuff, loudly making GBS threads on the sob stories of foreign students and ~creatives~ suddenly finding themselves having to pay more to live in what they thought was paradise (love the quotes about how they thought that Canadians were so nice and how could they do this to me!!!!).

They should be happy they're even allowed to speculate in another country's real estate market.

# ? Aug 17, 2016 03:52

namaste friends: Sep 18, 2004; by Smythe

why do we keep hearing about these ~unintended consequences~ about new taxes and no one ever says anything about the ~unintended consequences~ of retarded handouts like the loving capital gains tax exemption for primary properties

# ? Aug 17, 2016 03:57

MeinPanzer: Dec 20, 2004; anyone who reads Cinema Discusso for anything more than slackjawed trolling will see the shittiness in my posts

namaste faggots posted:

why do we keep hearing about these ~unintended consequences~ about new taxes and no one ever says anything about the ~unintended consequences~ of retarded handouts like the loving capital gains tax exemption for primary properties

Find me a Chinese student/foreign white family crying b/c the capital gains tax exemption hurt them and and ill write u a story

# ? Aug 17, 2016 04:02

namaste friends: Sep 18, 2004; by Smythe

http://www.theglobeandmail.com/real-estate/ottawa-mulls-risk-sharing-option-for-lenders-in-hot-housing-market/article31422162/

quote:

Ottawa eyes �risk-sharing� option for lenders in hot housing market

Ottawa is reviving a proposal that would force lenders to shoulder more risk in Canada�s heated housing market.

In a briefing note to Finance Minister Bill Morneau and released under Access to Information, department officials say they are studying an option to introduce �risk-sharing� for lenders, a move that would likely mean a deductible payable by the banks on the mortgage insurance provided by Canada Mortgage and Housing Corp. (CMHC) and its private-sector competitors.

Paul Duchesne, a spokesman for Finance Canada, confirmed to The Globe and Mail in a statement Monday that risk-sharing is among the policy options under consideration as the federal government undertakes a broad review of Canada�s housing market.

�As recommended by the International Monetary Fund and the Organization for Economic Co-operation and Development, the implications of lenders bearing a portion of losses on insured mortgages that default (also referred to as lender risk-sharing) is one area, among others, where work is being done by the department,� Mr. Duchesne said in an email. It�s part of the government�s �analysis of housing-related vulnerabilities� he added.

Organizations such as the OECD and the IMF have previously urged Canada to follow the model used in other countries, in which mortgage insurers typically cover the first 10 per cent to 30 per cent of losses, but require lenders to shoulder the rest. Under the current Canadian system, virtually all of the risks of mortgage defaults have been shifted to government-backed insurers.

CMHC chief executive officer Evan Siddall first publicly floated the idea of requiring lenders to share in the risks of insured mortgages in 2014. At the time, former finance minister Joe Oliver ruled out any �major moves� to introduce a deductible to mortgage insurance, saying the government aimed to curb taxpayers� exposure to the housing market through more gradual measures.

Mr. Siddall has remained a vocal proponent of risk-sharing. In an interview with The Globe, Mr. Siddall reiterated his call for risk-sharing and said he expected federal officials to begin talking more actively about the proposal later this year. �It�s a better system if the people who are managing the risk day to day, banks, lenders, have some exposure to that risk,� he said.

Finance Canada conducted consultations with the mortgage industry several months ago, floating a proposal that could see lenders taking the first loss on a defaulted mortgage up to a fixed percentage, a source familiar with the discussions said.

However, a major challenge for Ottawa is to decide how large of a share of any losses lenders should bear. Another issue is that many lenders securitize their insured mortgages through CMHC�s securitization programs and then sell them to investors. Federal officials still have to work out whether it would be the lenders that sold the mortgage, or the investors that bought it, that would take the loss if the government introduces a deductible, the source said.

A mortgage-insurance deductible would also likely lead to higher costs for banks and other mortgage lenders, which currently have to hold no capital against their insured mortgage portfolios since they are considered to be essentially risk-free.

Such a move would also make it more difficult for smaller non-bank lenders, which aren�t able to raise funds through deposits and therefore rely more heavily on the money they raise from securitizing and selling insured mortgages.

A deductible could potentially lead banks to raise their mortgage-interest rates, cause lenders to scale back their volume of new mortgage loans or lead to different mortgage rates depending on whether a borrower lives in an area of the country that has a higher propensity to default.

Terry Campbell, president of the Canadian Bankers Association, warned that a deductible on mortgage insurance would have unintended consequences for banks, likely requiring them to hold more capital and would also require more consumer education to help customers understand the changes.

�It�s our view that lender risk-sharing, for instance through a deductible on mortgage insurance, would represent a significant structural change to the way the housing finance system currently works,� he said. �And we think it could make it more complicated and more uncertain.�

He added that the current system has worked well, with prudent underwriting standards among the banks leaving just 0.28 per cent of mortgages in arrears.

Peter Routledge, an analyst at National Bank Financial, said banks would likely face higher funding costs related to the securitization of insured mortgages. �Because mortgages are such a thin-margin product, the banks would have to push up their mortgage rates,� Mr. Routledge said. �But I think the government, particularly Finance, understands the market and won�t do anything disruptive. It would be more gradual.�

In its heavily redacted internal document, dated Nov. 20, 2015, Finance Canada describes the risk-sharing proposal as �longer term in nature,� warning that it would have �potentially far-reaching impacts on lenders, borrowers and mortgage insurers.�

Just weeks after the document was presented to the minister, Mr. Morneau did act on one of the recommendations from officials by increasing minimum down payments for insured properties above $500,000.

CMHC has also since introduced new restrictions on how lenders use its portfolio insurance, a type of bulk insurance that lenders can take out on uninsured mortgages, and raised fees for lenders that use its securitization programs. The Office of the Superintendent of Financial Institutions also announced a plan to require lenders to hold more capital against mortgages in cities where the regulator feels house prices are unaffordable compared with incomes.

Bring this the gently caress on. Macro pru the motherfucking mortgage industry into the ground now.

# ? Aug 17, 2016 04:07

namaste friends: Sep 18, 2004; by Smythe

MeinPanzer posted:

Find me a Chinese student/foreign white family crying b/c the capital gains tax exemption hurt them and and ill write u a story

are you loving kidding me? you think any of these motherfuckers are buying houses that they aren't specifying as primary residences?

# ? Aug 17, 2016 04:08

MeinPanzer: Dec 20, 2004; anyone who reads Cinema Discusso for anything more than slackjawed trolling will see the shittiness in my posts

namaste faggots posted:

are you loving kidding me? you think any of these motherfuckers are buying houses that they aren't specifying as primary residences?

# ? Aug 17, 2016 04:24

leftist heap: Feb 28, 2013; Fun Shoe

Femtosecond posted:

I googled around for like 10 minutes and found nothing, but I am under the impression that municipalities don't have the power to zone to restrict residential use to purpose built rental only. Does anyone know?

They can do exactly that, it's basically why they exist and they do it all the time but it's usually just as part of affordable housing initiatives. If you really want to read the nitty gritty you can read the Local Government Act or the Community Charter, but they have pretty broad powers to reject or approve any development. A municipality can enact a community plan that essentially says "No more lovely condos gently caress off" and reject all condo applications that come across their desks. Easy. A supply sider like yourself should know these things.

# ? Aug 17, 2016 05:16

Seat Safety Switch: May 27, 2008; MY RELIGION IS THE SMALL BLOCK V8 AND COMMANDMENTS ONE THROUGH TEN ARE NEVER LIFT.; Pillbug

namaste faggots posted:

http://www.theglobeandmail.com/real-estate/ottawa-mulls-risk-sharing-option-for-lenders-in-hot-housing-market/article31422162/

Bring this the gently caress on. Macro pru the motherfucking mortgage industry into the ground now.

Holy poo poo CMHC mortgage insurance doesn't even have a loving deductible?

How am I still surprised by this?

# ? Aug 17, 2016 05:38

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# ? Jun 1, 2024 23:47

Baronjutter: Dec 31, 2007; "Tiny Trains"

http://www.cheknews.ca/bidding-wars-greater-victoria-rental-market-207772/
Here's a recent article on how hosed up renting is in Victoria right now. Meanwhile Helps and council hem and haw and drop platitudes about how they really want to add more rental stock but golly some people in Cook St. village said a 5 story building in a neighbourhood of 4 story apartments is a skyscraper so we better just not build anything. They aren't fast-tracking poo poo. Fast-tracking rentals in Victoria maybe means "we'll only do 15 community input meetings rather than 20" or "It will now take 5 old ladies saying the building will turn the city into Manhattan rather than 2". It will still only take 1 person from Vancouver or Toronto saying "But I moved here to get AWAY from density!" to stop any development though, specially if they can add "sustainable" to their argument.

Baronjutter fucked around with this message at 05:45 on Aug 17, 2016

# ? Aug 17, 2016 05:43

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

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