To The Pointwith Boris Bozic
Commentary, Opinions, Thoughts and Discussion on Current Events, Politics and The Mortgage Industry

4 Comments Mortgage & Housing Industry: It’s all About the Timing

Article written by Boris Bozic on the 10 Jul 2012 in Current Events

“If I’m a home owner in the Greater Vancouver Area, and just read the National Post article, I think I would be coughing up my latte through my nose about now.  But fear not Vancouver, you’re not alone.  Toronto joined in with its own negative results.”


It’s always easy to use the word “timing” to categorize success or failure.  We’ve all heard it before, “he was in the right place at the right time”.  Those who chalk up people’s success, purely based on timing, are usually the ones who missed the same opportunity because of a lack of skill and vision.  In politics timing is used to justify ineptitude and a lack of positive results.  If using timing as an excuse for failure, and if it was an Olympic sport,  then the Obama administration would own the podium.  After 3 ½ years of being in power all you here out of Washington is that it’s all George Bush’s fault, and that the Obama administration needs more time to set the country on the right path.  Blaming the last guy, after all this time, is laughable.  The President wanted the gig and he knew the mess he was inheriting.  It was his job to fix it or at the very least put the country back on track.  Time might be running out for Obama, and we’ll all find out in November.  Should he end up being a one term President, I’m sure the Dem’s will rationalize his failure with “he was the right guy at the wrong time”.

Here in Canada many have supported and questioned the timing of the most recent changes to mortgage rules.  As of July 6th it’s our new reality.  I’m looking out the window right now and it’s sunny, stinking hot here in Toronto, and the ground hasn’t opened up and swallowed up all of us in the industry.  Then again it’s been less than a week.  I was thinking of the timing of the new mortgage rules while reading an article in the National Post recently, “On Wednesday (July 5th) the Real Estate Board of Greater Vancouver released June figures showing sales down 27.6% from a year earlier and down 17.2% from just May.  The benchmark price index was 1.7% from a year ago but the city has seen prices drop in the shorter term and economists expect more declines to come”.  If I’m a home owner in the GVA, and just read the National Post article, I think I would be coughing up my latte through my nose about now.  But fear not Vancouver, you’re not alone.  “Toronto joined in with its own negative results as sales in the city declined 13% from a year ago while the entire GTA was off 5.4%”.  Prices have remained steady in the GTA but that appears to have a short shelf life.  For so long now pundits eagerly predicated a housing bust and I guess if they say it often and long enough they will be able to say, “I told you so”.

The most recent changes to mortgage rules had zero impact on the stat’s noted above.  There were many in the mortgage and housing sector, including CAAMP, who publicly stated that previous changes to mortgage rules went far enough.  Of course it’s easy for critics to dismiss the industry as being self-serving but based on the data available today, maybe, just maybe, the industry was not that far off.  The IMF (International Monetary Fund) is tweaking economic forecast for the remainder of the year.  There’s a general malaise as it relates to investments, jobs and manufacturing for the U.S., Europe, Brazil, India and China.   As we have all learned, what happens in the rest of the world impacts us here in Canada.  There’s merit to the argument that economic data justified the changes to the most recent mortgage rules.  But what if the most recent changes to the mortgage rules just adds to an already stagnant economy and slowing housing sector?  Not good if you’re an home owner and certainly less than optimal for those who could have a finger pointed at them, accompanied with a simple message,”you made it worse”.  Indeed, it’s all about the timing.

 Until next time





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Good Article Boris!

Peter Kinch @@peterkinch Website Reply

Well said Boris – I always find it interesting how newspapers trumpet statistics to bolster headlines. A year ago Vancouver was in the midst an offshore buying frenzy led by folks from mainland China. That drove up both volume of home sales and prices. So is it really a shock to see that a year later there’s a ‘statistical vacuum’ caused by the lack of Chinese buyers. Stats only tell a portion of the story – bu that won’t stop the papers from using them as headline news.


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