EDITORS LETTER
MORTGAGEBROKERNEWS.CA ISSUE 9.11 | $6.95
EDITORIAL
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2014
GUN-SHY LENDERS RETURN TO THE BATTLEFIELD What a difference 18 months make. In January 2013, lenders both in and outside the broker channel were ducking for cover, fearful that the once indomitable condo market would collapse all around them. That, of course, didn’t happen, although their apprehension was understandable given the 53% dive in new condo sales across the GTA in December 2012. Prices were also under pressure, having slipped anywhere from 3% to 8% compared to where they stood a scant six months earlier. There was more to fret about: The unrelenting buzz of condo construction in Toronto, Calgary and Vancouver continued unabated, but slumping migrant numbers threatened to further slash demand in the face of increasing supply. None of that bolstered confidence in condos for gun-shy Canadian lenders, who retreated from funding development projects but also began to balk at funding individual condo purchases. Their fears meant broker condo deals were under growing scrutiny by underwriters, with a handful of smaller lenders directly or indirectly adding condos to their do-not-call lists.
“The unrelenting buzz of condo construction in Toronto, Calgary and Vancouver continued unabated, but slumping migrant numbers threatened to further slash demand in the face of increasing supply”
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COPY & FEATURES MANAGING EDITOR Vernon Jones SENIOR WRITER Justin da Rosa JOURNALISTS Ryan Smith, Sam Richardson CONTRIBUTORS Ron De Silva, Gary Mauris, Eddy Cocciollo, John Kelly, Paul Therien, Cameron Strong, Mark Kerzner, Michael Beckette, Albert Collu, John Bargis, James Shinners, David Smith, Vawn Himmelsbach, Samo Ayoub COPY EDITOR Clare Alexander
ART & PRODUCTION ART DIRECTOR Daniel Williams GRAPHIC DESIGNERS David Calderon, Joenel Salvador, Marla Morelos
SALES & MARKETING ASSOCIATE PUBLISHER Trevor Biggs GENERAL MANAGER, SALES John Mackenzie MARKETING AND COMMUNICATIONS Claudine Ting PROJECT COORDINATOR Jessica Duce
CORPORATE PRESIDENT & CEO Tim Duce OFFICE/TRAFFIC MANAGERS Marni Parker, Kay Valdez EVENTS AND CONFERENCE MANAGER Chris Davis Editorial inquiries vernon.jones@kmimedia.ca Advertising inquiries trevor.biggs@kmimedia.ca
But they’re back – lenders, that is. ICICI is the most recent prodigal player to announce its return. The monoline, less than eight years in the channel, said last month that it would begin lending on high-rise condo units immediately. The decision comes on the heels of similar moves by four other broker lenders. Their return has everything to do with a soft landing for Canada’s condo market – September sales in Toronto actually rose 20% year-over-year, and prices ticked up seven points over the same period. Key centres across the country are mounting similar comeback stories, driven by demand that remains strong. The fact is, demand may actually get even stronger in the medium term as buyers find their dreams of owning a detached house, semi or even a stacked townhouse scuttled by soaring prices. The return of broker lenders to the condo sector promises to position brokers to claim a large chunk of the coming uptick in sales. Vernon Clement Jones Editor
6 | NOVEMBER 2014
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