Poloz: HCG problems ‘idiosyncratic’ and contained

Bullwhip29 pointed out this article in the financial post where Bank of Canada governor Stephen Poloz says that the troubles at Home Capital are ‘idiosyncratic‘ and contained:

Poloz said the central bank saw no signs that Home Capital’s deterioration had triggered contagion, according to an interview with the newspaper on the sidelines of the Group of Seven meeting of finance ministers and central bankers in Italy.

“We’d be looking for signs that there are problems with the (financial) system as opposed to preoccupying ourselves with individual institutions,” Poloz said.

He also has some stuff to say about the housing market in general:

Poloz also reiterated in the interview the central bank’s view that recent house price increases were not sustainable, and echoed previous statements that some speculation appeared to be at play in the market. He added that did not mean a major price correction was in store.

“Often, when you have a truly unsustainable housing market, you will see very rapid price increases (and) very rapid credit growth,” Poloz said. “But we don’t see that in the credit side, so I do think a significant amount of this that is fundamental, but layered on top, is a speculative element.”

Read the full article here.

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B.C. government wants to resolve foreign buyers tax lawsuit without full trial

>>> shocker…they don’t want to go to court and air out their dirty laundry. i guess we’ll see if Jing Li really cares about the cause or initiated all this simply to cash in herself.


I’m back!
10160 River Drive, Richmond
Feb 23:$1,688,000
May 16: $1,099,000
Change: – 589,000 -35%
Assessment: $1,208,400

Vancouver Review

May 18, 2017 Our Daily Review of Vancouver Real Estate Housing Bubble News


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Chinese Insurer Warns Of “Mass Defaults, Social Unrest” Due To “Mass Redemption” Run


And while fraud and embezzlement are both endemic in China , the bigger concern raised by the article was the threat of a bank run across China’s massive and unregulated, nearly $10 trillion shadow banking system. Indeed, while there have been numerous allegations and warnings that China’s entire shadow banking facade, dominated by WMPs and other “investment products”, is nothing but a giant ponzi scheme in which recoveries – should there be a bank run, a topic recently discussed on Bloomberg – would be non-existent if there is ever a bank run, defaults of WMPs issued by big banks – and this case an unapproved WMP – are rare, as are shadow bank runs.


Price Change


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Inventory hasn’t been this flat since the 1850’s.

Just me

Pope, can you allow my post awaiting moderation. It seems to be stuck.


Rents in San Francisco — and these 4 other cities — are getting slashed like crazy

Just me

Douglas Todd: New approaches to the ‘astronaut’ phenomenon


While many astronaut families exhibit as much integrity as others, some taxation and immigration specialists believe Canada needs new ways to counter the downsides of circular migrants — particularly unaffordable housing and uncollected taxes.

An anti-corruption agency, Transparency International, recently released a report calling Metro Vancouver one of the hot spots for a globalized “corrupt elite” intent on making their dirty wealth look clean by laundering it through real estate; exploiting gaping tax loopholes.

What can be done? The short answer is better taxation and immigration policy — and rigorous enforcement.


This has been a problem of 30 fucking years.

Best place on meth

“An anti-corruption agency, Transparency International, recently released a report calling Metro Vancouver one of the hot spots for a globalized “corrupt elite” intent on making their dirty wealth look clean by laundering it through real estate; exploiting gaping tax loopholes.”

That’s all we need to know, our politicians who are traitors have destroyed our once great country and sold us out to communist chinese criminals.

Head’s need to roll, literally.

Combat roach

Confiscate all their shit here to cover for lost taxes and promptly get all those astronauts on a fucking rocket and send them to the moon. Problem solved.


What’s the difference between a 10 yr long bubble and a bull market?


Price to earnings.

Abdul Lahazi

Vancouver developer fined, banned from trading after investor loses $1M.
A hearing concluded he defrauded a client for part of a $1-million investment in a project that failed.


Geez…a Canadian reject helps shithole China wins gold. Just shows how bad Asian are at real physical sports in general. Also, why is this traitor going to China and help them? One of our wonderful role model immigrants no doubt.
Combat Roach, BPOM, Abdul, etc, one of you guys please go and straighten this loser out and let him know where his loyalty should lie. Please! We must set an example to others.

Best place on meth

“Just shows how bad Asian are at real physical sports in general”

I disagree, the Japanese are very impressive at sports, as are the South Koreans – especially considering the size of their populations.


Even the chinamen are much improved since they mastered the art of doping without getting caught.

Although if you take the doping out, your average Japanese or Korean is 10 times the athlete of your average chinaman.

So yeah, you’re wrong.

Abdul Lahazi

“It’s time to remind folks that prices of houses can go down as well as up,” he said on April 12th.
These useless central bankers need to stop jawboning and actually start raising interest rates.

Just me

Poloz must be the worst central bank governor in Canada for the past four decades or so.
The guy admitted that the hosing market is a threat to financial stability, yet he perseveres with ultra-low interest rates and a ridiculously low exchange rate.

Both policies encourage foreigners and local “investors” to gamble recklessly in the housing market. One has to wonder if this gambling is considerate legitimate economic activity by Poloz and his advisors.


“Poloz must be the worst central bank governor in Canada for the past four decades or so….”

No, that was Carney….



Central bankers have painted themselves into a corner. Reducing interest rates have had fewer and fewer positive effects in the private sector, and have thoroughly killed any measure of affordability in the housing market. Any meaningful increase in the interest rates will trigger an immediate recession, and no central banker wants to pop the credit bubble. Sometimes the best medicine is to normalize rates, and correct the distortions in the credit market. This is a bitter pill to swallow though and no central banker has the balls to intentionally trigger a recession.

Joe Condo

The blame is really on our elected officials, who ran away screaming from the recessions of 2000 and 2008 leaving it to central bankers to deal with using the only tools they have – money printing.

The lazy man’s way to fix the economy.

But, hey, what does my MP know about economics anyway?


His mandate is to keep inflation steady and below 2%, not to keep housing price cheap for bears. That’s the federal, provincial, and municipal governments job and they have done nothing on that front. Rather, they are doing everything they can that will harm potential buyers & bears in the future.

Joe Condo

“Various levels of government have been trying to restrain house prices (which Mr Poloz has encouraged to rise by keeping interest rates low).”

The Economist hits the nail right on the head.

Joe Condo

Mind you, Carney’s to blame too.

Joe Condo

Might as well include all the rest of the G7 central bankers


“The Economist hits the nail right on the head.”

Just a tap. Here’s a hit:

“Various levels of government have implemented timid half-measures to slow the growth of house prices, but at the same time they don’t want prices to go down. Nothing illustrates this better than the BC government’s introduction of interest-free mortgages on the heels of a foreign buyers’ tax.”

Abdul Lahazi

Borrowing for retirees can be filled with challenges, but it’s on the rise :


According to a report by Equifax, debt excluding mortgages held by those over 65 averaged $15,244 in the fourth quarter of last year.
That was below the Canadian average of $22,113 — but those over 65 posted the highest percentage growth compared with the fourth quarter of 2015 at 6.1 per cent.

Patiently Waiting

This statistic doesn’t even mean much when so many are hiding their consumer debt in their mortgage. Are there statistics out there to show what percentage of mortgage debt isn’t directly related to their home?

Anecdote: A friend who bought a car recently, bought it “on the house” by increasing the mortgage on her Surrey condo. She knows she’s screwed and pointed out that her mortgage is now higher than the original one from when she purchased the condo 20 years ago. Works in retail and takes annual vacations down South.

Combat roach

Isn’t she the poster child of a successful and perspicacious BC citizen who is taking the right “risks” at the right times because no consequences will be experienced whatsoever?

Patiently Waiting

I don’t think she bought to speculate back in the 90s. Just tired of rental BS, and only has one modest condo. She is actually a really down to earth, decent person. This makes me think it is much worse with certain other types of people. Think of all the idiots making $40K a year and owning multiple investment condos. Scary.


Only to the bears…

Combat roach

“Think of all the idiots making $40K a year and owning multiple investment condos. Scary.” I know a few of them directly and they are seen as small town Gordon Gekkos on his way up in their social circles. I’ve seen one woman saying at the table about the guy (a technician in a car dealership) in his late 20’s about how he is super successful and smart by all means because he started with one condo in Coquitlam and “smartly invested” in 5 other condos across the LM in the past 8 years and he doesn’t give a shit about education and career crap because he is already outperforming the all of his peers and most of the elders with respect to his potential net worth. She claims that he is the probably the smartest young person that she… Read more »


Mortgage rates are much lower than auto loan rates. She would be an idiot to pay higher auto loan rates when she can pay probably less than half that by rolling it into her mortgage.
And so what if she goes bust. At least, she will have those vacations to the south in her memory. Better that than slaving away, did nothing fun, and still have nothing to show for it. Or save up all money and yet can’t even enjoy it because your body gave out from old age.

Patiently Waiting

For the car, I’d probably do the same thing if I was in her position. It’s a needed, basic and used commuter car. But people who do this are paying interest over a longer period, even if the rate is lower. There’s a good chance she will end up paying more interest on the car since she clearly is not paying off her mortgage, and probably never will.

I don’t know if she’s paying for vacations with her mortgage. I’m all for vacations, but that is a bad idea. If a lot of people are using home equity to fund expensive vacations, there will be trouble eventually.

But my main point is that it is hard to measure consumer debt hidden in mortgages, and there appears to be a lot of it.


@Doomcouver – Hey Doomcouver, you seem like a smart, analytical kind of person, unlike the stupid bulls on this blog. So, I got a couple of questions. 1 – Home prices rising at 10% / year on average is as you say totally unsustainable. So when do you think the prices will fall and how far will it fall? Will it just fall to the average price? Or maybe all way to 2006 prices before all the craziness started? How long do you think that will take? What to do in the meantime? Every rental open house I’ve been to has 10 competitors all offering above asking rent! What can I do?? 2 – What do you think about asset class that’s been going up 10%/yr on average for almost 50 years now? Do you think that asset will ever… Read more »


Thank you for the nice compliment. There are a number of variables to when and how much prices will fall. They all fall into one of two categories however: 1. Direct – An external force makes them fall (spike in unemployment, credit contraction, massive cut in immigration, etc.) 2. Indirect – Investor perception of housing as an investment changes (housing crash in another country, fear of bank runs, etc.) As you can see, none of these are completely predictable without a crystal ball to see into the future. What is for certain is the bubble becomes more fragile, especially to direct factors, as housing becomes more expensive. As for how far it will fall, that is easier to estimate. If it is a full-blown crash, and I am expecting there will be one, the prices will not see support until… Read more »


B.C. Liberal donors injected $1.5M into Clark’s final election week push

“…according to B.C. Liberal “real-time disclosures” posted on the party’s website last Friday, donors forked over $1,543,303.52 in the last seven days before polls closed…”

“the largest last-minute cheques came from forestry giant Interfor, and Anthem Properties, which calls itself “Vancouver’s top real estate development firm…”

“the party’s unaudited donations lists were saved as PDF files, making them difficult to combine or analyze…”

Just me

I still wonder why no investigative journalist has yet looked into Christy Clark housing arrangements: as far as I know she is renting a whole house in Kerrisdale, close to vancouver College (where her son is a student). She also owns a townhouse in Point Grey.
It would be veru instructive if someone could unveil how she pays for her big home, what price she gets and whatever possible in-kind gift she may be receiving from Liberal donors.
In Vancouver, housing in-kind gifts may be way more valuable than her paltry 50k extra salary (also paid by developers and the such).


her son goes to st georges and msm not allowed to disclose her whereabouts for security reasons. i’m sure she owns multiple properties all over the province via blind trust, numbered co etc. no way she is going thru all this BS for an extra $50k too. imho she must have her sights on a low to mid 8 figure payday at the very least.

Just me

Sorry, I got mixed up. St George’s is actually even more exclusive (and expensive) than Vancouver College.
The student body includes multiple kids from rich families (developers, mining executives) as well as kids from expatriate Chinese (astronaut) families.
How appropriate for our Prime Ministers to mix with her donors also after work.


Or they might have waived or severely reduced the tuition for the privilege of having premier’s son as a student, and future considerations. Ever wonder why public education is going down the tubes every year?


i’m sure it’s just a coincidence that anthem’s executive vp happens to be kevin falcon


Home Capital named James Lisson, who has worked with law firms and with the Canadian Department of Justice as a consultant on commercial law, to its board of directors.


A B.C. government whistleblower steps from the shadows

Jeff Melland, the former government insider who blew the whistle on the so-called “quick-wins” scandal that rocked the Christy Clark government. Melland is blowing the whistle again, and has a warning for B.C. Green party Leader Andrew Weaver: Don’t trust Clark’s Liberals.


Canadian Officials Preach Calm Amid Home Capital Worries

“We don’t think there’s any systemic risk across the country,” said Phil King, a director at the economic and fiscal policy branch at Finance Canada. “There are specific pockets of concern, which seem to have ameliorated somewhat in the very-near term but we’re keeping a very close eye on those.”

>>> just watch reruns of Bernanke preaching the very same thing in 2006/07. this is like a low budget made for tv reboot of the same movie…


Richmond approves 11,000 square foot limit on farmland mega-homes

>>> all this means is that property owners will build multiple medium sized homes on lots that they will ultimately get subdivided


“BC Liberals’ Housing Plan Worsens Affordability Crisis: CMHC Head”, The Tyee


“The head of the Canada Mortgage and Housing Corporation wrote officials across the country to criticize a 2016 British Columbia program that gives interest-free loans to first-time home buyers.”

“Evan Siddall, president and CEO of the CMHC, was scathing. “Programs that support demand in supply constrained markets, like Vancouver, serve primarily to increase prices and make the affordability problem worse,” he said.”


Christy clark would do anything to appease her developer buddies. She knew the consequences and was told not to and went ahead with it anyways, she doesn’t care about destroying families with debt as long as her donors are happy.

I remember as soon as that program was introduced the housing buys shot back up. Exactly what she wanted.

Shut It Down Already

Nobody is forced to take on mortgage debt. People are choosing to do this to themselves.


Right. But sellers have increased prices just in case

Shut It Down Already

Sellers are pricing at the point that buyers are prepared to pay. Its really that simple.


Christy might as well take taxpayer money and shove it directly into Bob Rennie’s pockets.


I don’t think we’ll see a housing downturn till the interest rates go up and right now there’s no chance of interest rates going up, could be another 10 years of low interest rates.

No way I see interest rates going up, with so many people already in debt.

Combat roach

Apparently time to buy. In the next 10 years prices will go up about 860% based on previous performance and adjusted for trending political and global circumstances.


Let’s crunch some numbers. Since 1 year ago, Canadian home prices have increased approximately 10%. Many housing bulls believe this is a sustainable amount of capital appreciation for such a “valuable” asset as housing. Let’s see what happens if the trend continues at 10% per year: April 2017 (current): 559,317 2018: 615,248 2019: 676,773 2020: 744,450 2021: 818,896 2022: 900,785 2023: 990,864 Perhaps you live in that fantasy land where the average home in Canada will be worth $1 million in 6 years. I however live in the real world, and in the real world when speculators realize they won’t be getting 10% (or 30%+ in Toronto/Vancouver) gains on their “investment” any time soon, they are all going to dump their illiquid asset on to the free market. Bear in mind that almost every Canadian that has bought a house… Read more »


I hope you’re right Doomcouver, but how long have we been expecting the housing prices to go down for. Historical interest rates average about 5-6% average, we’re currently at under 1% for about a decade. Even when interest rates I thought were low at 3%, it still went lower. As long as people can afford it they won’t sell, the only factor that would make housing less affordable is interest, so as long as interest remain the same I don’t see it as a possibility for housing prices to go down. Too many jobs are supported by housing, it’s a domino’s effect if housing goes jobs go, but the governments will do everything to keep this going. Yes it’s a house of cards and can collapse at any time, but I don’t see the government allowing it seeing the shit… Read more »


at the very least prices will flatline or maybe grind a touch lower over an extended period of a few years. for owners that are operating in redline territory already (and are banking on a quick pop in prices) this would not be a positive development. in that time rates could change for the worse making renewal problematic, new rules and regulations that apply to various aspects of the mortgage/lending business, tenancy act, short term rentals, vacant properties etc etc could (and probably will) change given the current political environment


A resilient bubble is still a bubble. The Canadian housing market is underpinned by a strong cult of ownership, cheap and easy credit, and rampant speculation. Anyone who thinks they know when it will end is delusional. The only thing that is certain is it will end. Additionally the larger the bubble gets, the more fragile it becomes. We’re definitely in the late-phase of this macro-cycle in Canadian housing, I’m positive of that. There are more external pressures on the bubble than have ever existed before. Like you say the government will likely try to stop it, however similar to when the bubble was growing, they will be late to the party in trying to prevent the collapse.