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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.


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BFCSA: Insane Vancouver Property Bubble inflated by BC Government and Bankers - Int Only 2nd Mortgages!!!!!

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BC government is offering interest-free second mortgages to cover down payments


Australian Property Market even worse!


Desperation Invades Vancouver Housing Bubble, as Hot Money Still Pumps up Toronto, Hype Overflows

by Wolf Richter • Feb 5, 2017 • 0 Comments


In Toronto, “home ownership continues to be a great investment,” which is what they said about Vancouver a year ago.

So the bottom has fallen out of the Greater Vancouver housing market, a process that started after the crazy peak in July. According to the Real Estate Board of Greater Vancouver (REBGV), sales of homes of all types – detached, attached, and condos – plunged 40% in January compared to a year ago, with sales of condos dropping 25% and of attached properties 32%. Detached homes got hit the hardest: sales plummeted 58%.

There was no way to put a positive spin on it, not even for a real estate board. REBGV president Dan Morrison put it this way: “It’s a lukewarm start to the year compared to 2016.”

Even as sales collapsed from the record-breaking bubble-pace a year ago, the number of homes newly listed for sales in January rose 7% year-over-year to 4,140. And the total number of homes listed for sale rose 9% to 7,238.

The benchmark price – a theoretical price that the REBGV uses instead of the more typical median price – for detached homes has fallen 7% since the July peak, to C$1.475 million.

By the same measure, condo prices inched up 0.3% to C$512,300. And prices of attached homes inched down 0.4% to C$666,500. For the Greater Vancouver area, the composite benchmark price for all residential properties is down 3.7% over the past six months to C$896,000.

The hot money has abandoned the Vancouver housing bubble, which is now left to its own devices. And the idea of homeownership as this magnificent investment with outsized annual returns has just been taken out the back and shot.

But the hot money is till pouring into Toronto. The Toronto Real Estate Board (TREB) reported that total home sales in January through its MLS system jumped 12% in January year over year, to 4,640 homes.

“Home ownership continues to be a great investment,” explained TREB President Larry Cerqua. “As we move through 2017, we expect the demand for ownership housing to remain strong….”

That’s what they said about Greater Vancouver a year ago.

In February last year, the REBGV said, “Fundamental economics are driving today’s market. Home buyer demand is at near record heights and home seller supply is as low as we’ve seen in many years.” Nothing could go wrong.

In March last year, the REBGV said, “We’re in a competitive, fast-moving market cycle that favors home sellers.” And: “Sustained home buyer competition is keeping upward pressure on home prices across the region.” At the time, the benchmark price had jumped 22% year-over-year.

But then new listings began to pour on the market, and by July 5, the REBGV lamented: “Since March, we’ve seen more homes listed for sale in our market than in any other four-month period this decade.” That was a sign that the bubble had run its course: more and more residential property speculators were trying to unload. Now we know that July was the peak of the bubble.

But the Greater Toronto Area (GTA) hasn’t reached that point yet. In January, the benchmark price and the average price were both up 22% year-over-year, with the average price of detached homes up 26%, of semi-detached homes 28%, of townhouses 27%, and of condos 15%.

And the number of active listings in January plunged “essentially” by half. The report: “That statistic, on its own, tells us that there is a serious supply problem in the GTA – a problem that will continue to play itself out in 2017. The result will be very strong price growth for all home types again this year.”

A year ago, there was a serious supply problem in Vancouver too – until suddenly, there wasn’t.

The Vancouver housing market was already showing signs of peaking, with lots of supply coming on the market when in August last year British Columbia implement a 15% transfer tax on properties sold to non-resident investors. This was aimed at Chinese buyers who’ve been flocking to the Vancouver market. Scaring them away sped up the process of bubble pricking.

It coincided with Canadian government efforts to tamp down on risky mortgages to overstretched home buyers.

By December, Vancouver home sales had slowed to such a scary degree that the B.C. government offered interest-free loans to first-time buyers (Canadian citizens or permanent residents) to be used as down-payment, which put the taxpayer on the hook to keep the Vancouver house price bubble from imploding. They called it the “B.C. Home Owner Mortgage and Equity Partnership program.”

There are some limitations, including that the price must be less than C$750,000. So condo territory. And condos are notoriously volatile. The buyer will end up with a second mortgage on the property but will not have to make interest or principal payments for the first five years. After that, this second mortgage is put on a 20-year repayment schedule, payable in addition to the first mortgage.

This makes for one heck of a “down payment.” So now, B.C. is creating the next generation of first-time buyers with a borrowed down-payment on top of a mortgage to finance a purchase near the peak of the house price bubble which UBS last September considered the one with the highest risk in the world of deflating.

Developers love it. This taxpayer money is going to line their pockets. And by the time the ruse falls apart, they’re long gone with the money.

But it won’t keep the bubble from deflating. Once the process starts, it saps the blind confidence that bubble buyers require, and it knocks the wind out of them, and they pull back. Suddenly owners are motivated to unload their properties, hopefully at peak prices, just when buyers have evaporated. And the market freezes up with sales volume plunging. That’s the first step.

This is happening now in Vancouver. Toronto is lagging behind.

The market will remain frozen until sellers lower prices enough to lure in some buyers. And when those buyers are under water a little while later, it further knocks the wind out of the next wave of potential buyers….

This unraveling of the house price bubble will continue to play out in many small steps, spread over years – and the fact that the BC government is offering interest-free second mortgages to cover down payments that cannot be covered otherwise proves just how ludicrously overpriced the market has become, in relationship to incomes, and how much of a potential decline it is facing.

In the US, the overall national rent figures are hiding the drama on the ground. Read… Rents Plunge in Costliest US Cities, Soar in Mid-Tier Cities 

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