Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

"Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

thebureau.news

Post reply on HN
Print view View original

161–170 of 417 posts

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#161

Post by robocat »

guidedlight wrote: post #129
ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

Everything you write is also true if you replace Canada with Australia.

New Zealander here: much the same.

New Zealanders definitely hate entrepreneurship - one political party wanted to introduce a wealth tax if you had more than $1 million equity. Median house price in Auckland is just over $1 million! Auckland has about 30% of the population, and house affordability (price compared to income) is similar as bad as Sydney or San Francisco.

I have done okay for myself founding a software business and I notice the tall poppy syndrome from friends. Plus the relentless attack on my hard earned savings by a grifter government. And shit support for businesses to start-up or function (government incentives are mostly negative, and the positive incentives are incredibly badly run).

Fortunately we are building more houses in New Zealand (low single digit percentage growth) but unfortunately immigration is exceeding supply. We need the immigrants because we aren't breeding enough New Zealanders.

My experience of our government healthcare system is mostly positive.

I don't understand it: we should want people to save for their retirement but all the incentives to save are negative. The main taxation incentive is to gear up and borrow money for property. Then that blows up of course.

Even our right leaning government seems to want to consider a capital-gains-tax. The existing taxes screw any reason to invest in the stock market.

I'm whinging: I think it is a good place to live but I feel a comfortable retirement is becoming an unacheivable dream.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#162

Post by jabbany »

seanmcdirmid wrote: post #139
jabbany wrote: post #94

Earlier quoted context omitted.

> You can take out $50k per year Try buying a house with 50k a year... This is exactly what the "scheme" solves. You have new immigrants who have (in many cases) legitimate money (e.g. by selling property back in china) but cannot move it out of the country quickly due to capital controls on the chinese side. Since mortgages are meant to spread out costs over time, it's the perfect solution. However, banks (understan…

Foreigners on Z visas can wire out whatever they earn, so for me it wasn’t an issue. There are even foreigners who rent out some of their allocations since you always have PRC expenses, but this is of course illegal. I used my wife’s $50k allocation once because I was held up by some paper work (you need a lot of paper work, notarized, etc…). They didn’t ask any questions about what it would be used for, but this was…

Foreigners are not fully exposed to the local market though, so there's no need to do capital controls. _Income_ is never an issue, as there are taxes to cover that. The main thing being cracked down on is people moving accumulated _wealth_ out.

Also, things have changed _considerably_ since 2016 (as these things tend to do). Indeed, nobody --- foreign or domestic --- needed to document use as long as you stayed within the $50k (you would be asked to if you went above that). Later it became a mandatory question, but wasn't enforced. These days it is enforced rather strictly. If you claim education, you need to provide statements of tuition and housing etc. For tourism there's similar requirements, and usually they limit discretionary spending budgets to ~$10k.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#163

Post by diego_moita »

ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

As an immigrant into Canada: even if that description were true, it still would make it a lot better than the majority of other countries in the world.

Luckily, Canada is a lot better than your description.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#164

Post by JumpCrisscross »

ysofunny wrote: post #157
hnarn wrote: post #121

Earlier quoted context omitted.

> The whole country is a gigantic house of cards propped up by real estate That’s quite the statement, I assume you have quite the source for it. The price-to-rent ratio isn’t that far off from the US, for example.

there's a tiktoker that compares real states prices in Canada and in various parts of Europe it's funny to see dozens of examples of european castles (buildings with tens of rooms and bathrooms, plus huge gardens) whose cost is in the same ballpark as 2 or 3 bedroom houses in random (but well [sub]urbanized) parts of Canada

> dozens of examples of european castles (buildings with tens of rooms and bathrooms, plus huge gardens) whose cost is in the same ballpark as 2 or 3 bedroom houses

Castles are a bit of a scam. The old aristocratic families that still own them, e.g. in Germany, tend to have a state subsidy for maintainance. If you didn't have the luck of being born into those families, you get all of the joys of Medieval engineering twinned to modern historic preservation bureuacracy.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#165

Post by thisisnico »

ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

As a Canadian, living in Southern Ontario, I couldn't agree more with your assessment. Somehow we are ranking #1 on so many charts for quality of life etc. I'm starting to believe these sites and reviews of Canada are paid for.

We were an incredible country before Trudeau took office. His aggressive immigration policy, no economic policy or plan, and creation of infighting on social issues, not tackling any of the core issues we face as a country, until absolutely forced to do so (in this case unlikely re-election).

We need to stop fighting over social issues and start being productive towards a stronger, healthier, and happier Canada. Social issues can't fixed if people can't afford shelter and food.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#166

Post by acchow »

JumpCrisscross wrote: post #160
ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

> Canada is the most overrated of all the developed countries You're also a politically stable energy and resource exporter bang next to a global economic superpower and security guarantor. Oh, and access to two oceans and soon a third. Canada has plenty of problems. But it's also tremendously blessed.

Likely the reason it doesn't need to accomplish much more to be a good place to live

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#167

Post by JumpCrisscross »

radicaldreamer wrote: post #128
ThisIsMyAltAcct wrote: post #25

> The whistleblower, whom The Bureau is calling D.M., immigrated to Canada as an international student from India, making him a minority among mostly Chinese-Canadian co-workers at the Aurora branch. > “I am going to reveal potential mortgage fraud at HSBC Bank Canada and possibly some employees benefited from the fraud, financially pocketing thousands of dollars, which I call the proceeds of crime.” > FINTRAC’s stud…

Are US banks just a lot more strict about source of income than Canadian banks?

> Are US banks just a lot more strict about source of income than Canadian banks?

American financial regulators are much more comfortable letting banks fail than their Canadian or European counterparts. (In part this is because of the sheer diversity of banks we have.) Being fined out of existence is a real possibility for an American bank. That shapes behavior.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#168

Post by jabbany »

topspin wrote: post #156
jabbany wrote: post #106

Earlier quoted context omitted.

You can label it however you want, if both the lender and borrower are willing participants, it will be difficult to prevent this from happening. Like mentioned in the article, often times the material is very obviously suspicious and banks probably know this and still turn a blind eye to it because these borrowers are low risk and much less sensitive to the high/rising interest rates of today...

> if both the lender and borrower are willing participants Eventually this behavior goes overboard and everything crashes. In the meantime, law-abiding people are screwed by the bubble. Then they are made to pay for the clean up. Fraud is costly, and rationalizing it contributes to the problem.

> this behavior goes overboard and everything crashes

Maybe... but you need to keep in mind most of these people are not really building a bubble. Unlike the subprime mortgage crisis, where things were built on inflated valuations, many borrowers in this "scheme" do have more than enough funds to cover the entire mortgage. It's just that their capital is relatively illiquid. This is also why the high interest rates have not significantly affected this.

The effects on housing cost is because of natural market merging where chinese properties are "overvalued" domestically. This is actually not new, and happened with Japan at some point as well.

That being said, the main risk for this is actually geopolitical... Should capital controls tighten (or, like, if war were to occur etc.) then there is a much bigger risk, but many are banking on the fact that, at least given the signs today, that is still unlikely.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#169

Post by maxglute »

ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

Canada is Australia, an relatively affluent bureaucracy that sells rocks and houses. We have too many people to be Norway, where less people, a few high tier sectors and plundering the land for other markets can sustain developed QoL. But we could do ok on that model if we keep population down and build up a few strategic sectors. Except or interests are more subsumed by US foreign policy so we can't sell all the rocks we want. See the foreign NGO meddling that repeately killed Canada fossil expansion plans. Meanwhile US gets first dibs on global English talent, and Canadian English talent. And ultimately Canadian giants get cut down to size - Nortel, Bombardier due to sheninangans. But being US neighbour/sphere is better starting condition than most, but it's still hard map to play on.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#170

Post by nyolfen »

nimbius wrote: post #123
ilrwbwrkhv wrote: post #108

I have said this over and over again: Canada is the most overrated of all the developed countries. The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Having lived and travelled extensively, most Canadians want a house somewhere in the woods instead of doing something meaningful with t…

>most Canadians want a house somewhere in the woods instead of doing something meaningful with their lives or try and innovate to build something. to be fair most Canadians were promised this as part of their countries stratospheric growth under neoliberalist policies. that they are not capable of it is no fault of their own. that they want this is at all is not a bane. > Where US got the best talent from India, Cana…

> turns out blaming immigration is a fools errand to distract from domestic class warfare

our post-hart-cellar immigration policy is a tool of class warfare via wage suppression. real wages have remained flat while productivity gains have steadily persisted, due to several systemic changes since the crisis of 1973, among them flinging the doors open to dilute the cost of american labor; this and outsourcing and globalizing supply chains also go hand-in-hand with breaking union power

Post reply on HN