Quote:
Originally Posted by automaton 3
^Many Canadian mortgages are CMHC backed, so not sure what he means there.
CMHC has also has sold "bulk" insurance to lenders, so many mortgages not insured by the borrower may have been insured by the lender.
Conventional mortgages (at least 20% down) are non-recourse in Alberta.
Real estate is local. I have no doubt the lower mainland BC real estate market is headed for trouble.
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I think the point was that generally full recourse mortgages are worse for the over all economy. They encourage lenders to loan even in bubble scenarios. And the resulting deficiency judgments can wreck havoc on recovering economies. I've read that 90% of loans in Canada a recourse loans.
Alternatively in Alberta we have these relatively unusual non recourse loans which puts our property values more at risk in a macro economy that is struggling with recourse loan fallout. Just seems like a bad place to be. The worst of both worlds.
Also CAD at $1.40 seems fairly inevitable with likely interest rate increases in the US interest rate and decreases more likely in Canada's interest rates. That plus increasing Canadian debt, worsening GDP, I think $1.40 is generous.
On the bright side I've been working in Kelowna and have encountered several Asians heading west to buy property. Maybe we'll get some Vancouver tax fallout.
Oh and i think the source of the article is cnbc but literally thousands of news outlets will run it. I just copied the first one I Google'd.