"Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks • Hacker News Board

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

#381

Post by rybosworld » Wed, Feb 07, 2024, 3:53 PM UTC

jeffbee wrote: post #255

rybosworld wrote: post #241

Earlier quoted context omitted.

The market's not bearing rent so much as existing property owners are colluding to prevent new construction. If new construction wasn't so aggressively blocked in some major cities (San Francisco, Boston, all of Canada it seems), then the rents would not be nearly as high as they are. Wealthy property owners are behaving a lot like a cartel in many places.

Exactly. The discourse about foreign buyers of homes in Canada is centered on the morally bankrupt notion that it is only wrong if that race exploits the system. If a good old white guy exploits the same system it is not worth mentioning. What I am saying, and you seem to concur, is that the system itself is the problem. The identity of the person exploiting it is irrelevant unless you are a racist.

I don't know how/why you even thought to interject race into this discussion.

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

#382

Post by rybosworld » Wed, Feb 07, 2024, 4:02 PM UTC

rokkitmensch wrote: post #379

avidiax wrote: post #373

Earlier quoted context omitted.

It is a risk free option. The Chinese income isn't real. You can't meaningfully garnish the wages of a part time casino dealer. They have no other assets to cover the potential shortfall.

You assume these are poor people, other assume they're quite wealthy and laundering untaxed income into assets in .ca. If the latter, they may even have a proportionate pile of assets to seize locally. I betcha you could restate your point to come across a little less jingoistic.

> "You assume these are poor people"

The OP is right, the income isn't real. It's right there in the article: "Aurora branch had direct knowledge of faked Chinese income mortgages"

You assumed that the OP assumed something. Then you assumed that the OP's (non)assumption was motivated by jingoism.

Comments like yours are the worst.

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

#383

Post by VK538FY » Wed, Feb 07, 2024, 4:05 PM UTC

uLogMicheal wrote: post #203

jeffbee wrote: post #155

Earlier quoted context omitted.

If the market will bear the rent, why does changing the nationality of the owner improve anything?

This has nothing to do with nationality and everything to do with fraud. If other nations are doing this, it should stop too. Telling lies to acquire loans is illegal and inflates prices for everyone working legitimately.

Good point. Well I know Canadians, Chinese, immigrants and banking.

I'm not surprised that some Chinese (or any) immigrants in Canada try to take advantage of the linguistic barrier to obtain credit. And since important Canadian documents are often less standardized than in other countries, one can surely employ a bit of artistic creativity with a stamp here and a stamp there to put through a false document.

I've personally dealt with fraudulent credit applications, submitted and approved, because the bank employee (Canadian, no relation to the client) wanted to improve his numbers. At least when I was involved in credit, because of the workflow, the middle office made decisions first based on the numbers provided to them by the front office. Of course they were supposed to control all supporting documents but they weren't exactly zealous and if you knew their work habits, you could probably deduce the best time and language for the submission of a questionable application.

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

#384

Post by montjoy » Wed, Feb 07, 2024, 4:27 PM UTC

alchemist1e9 wrote: post #274

denton-scratch wrote: post #218

Earlier quoted context omitted.

> Consider food, water, healthcare—all necessities, yet all benefit from private investment and innovation. I live beside the river Thames, which private "investment" has transformed into a sewer. My access to food has shrunk; I used to have access to butchers, greengrocers and so on. Now all my food comes from supermarkets. The health system I depend on has been gradually privatized, and it is now at breaking point.…

Blaming private investment for pollution and housing issues ignores the core role of government in regulating externalities and protecting property rights. The Thames’ state isn’t due to market failure but government inaction, a prime example of state failure. Moreover, the economic decline witnessed in the UK isn’t caused by capitalism but by anti-market policies stifling competitiveness. The real issue is the colle…

I think in an ideal world you’re right. Ideally if housing costs were too expensive I would just move somewhere else. However we live in a world where there are borders and immigration policies and violence and relationships and jobs and climates that make moving around hard. Housing is a hard problem because there are limited resources for where people want to/can live. It’s a type of natural monopoly. I’m pretty sure history has abundant examples of what happens when you allow natural monopolies to run unchecked. Personally I’d rather have a mismanaged democratic government in charge of the monopoly than any private entity.

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

#385

Post by ilrwbwrkhv » Wed, Feb 07, 2024, 4:30 PM UTC

dang wrote: post #272

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…

Ok, but please don't take HN threads on generic flamewar tangents. This is in the site guidelines: https://news.ycombinator.com/newsguidelines.html . Edit: looks like we had to ask you exactly this before: https://news.ycombinator.com/item?id=34844518 , about exactly the same topic. Can you please not do this on HN? It's not what this site is for, and destroys what it is for.

Ok sorry.

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

#386

Post by cloudedcordial » Wed, Feb 07, 2024, 5:05 PM UTC

khzw8yyy wrote: post #375

billy99k wrote: post #322

Earlier quoted context omitted.

I get that they shouldn't be stereotyping, but I frequently travel to Markham, and see lots of young Chinese kids with expensive cars. I think the last time I was there, I counted 40 Teslas.

A Tesla is not an expensive car anymore, it's the new Toyota Camry.

I'd drive a more humble car than a Toyota Camry to dodge the annoying questions on "Chinese money". I made serious efforts to do well at school and to have a reputable career in tech.

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

#387

Post by cloudedcordial » Wed, Feb 07, 2024, 5:20 PM UTC

noobermin wrote: post #348

al_borland wrote: post #311

Earlier quoted context omitted.

Can you explain what they are implying? Is there a belief that China hands out blank checks to anyone who happens to be Asian? This sounds insane to me.

Read the article. It's not china giving blank checks, it is the set of rich folks China's stellar rise has created who are property rich and have capital from China they can live off of. There's no blank checks. The stereotyping is lumping the parent post with this group on the basis of North American racial categories ("Asian" as a group, as if that's a thing.)

Lumping together "Asian" as a group is definitely annoying. The different nations and countries from East Asia alone could be unique culturally and politically. In addition, many ethnic Chinese have been living around the world for generations.

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

#388

Post by themaninthedark » Wed, Feb 07, 2024, 6:01 PM UTC

jabbany wrote: post #168

topspin wrote: post #156

Earlier quoted context omitted.

> 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 h…

No single snowflake triggers the avalanche.

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

#389

Post by routerl » Wed, Feb 07, 2024, 6:30 PM UTC

nojvek wrote: post #376

Could someone explain why Canada with their 40M population (almost 10x smaller than US) is running into highly overpriced homes? Canada is one of the largest countries on the planet. Why can’t Canada build more homes? Also why can’t we ban foreigners from owning homes? Same issue applies to US as well.

> Canada is one of the largest countries on the planet.

So is the USA but it's still very expensive to live in NYC or SF. This isn't a Canada problem, it's a Toronto/Vancouver/Montreal problem (and their wider metropolitan areas), which together account for more than a third of the country's population.

> Why can’t Canada build more homes?

Partly due to idiotic zoning laws, partly due to the "missing middle" layer of the housing market, but mostly due to "investment properties" that sit empty and may as well not have been built at all.

> why can’t we ban foreigners from owning homes?

We sure could! Or just tax the hell out of it. But it wouldn't sit well with real estate developers and the politicians they've purchased.

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

#390

Post by seanmcdirmid » Wed, Feb 07, 2024, 6:31 PM UTC

pchristensen wrote: post #282

seanmcdirmid wrote: post #271

Earlier quoted context omitted.

I got the feeling that the HSBC in Bellevue Washington catered primarily to overseas Chinese clients looking to buy homes in the Seattle area. Most of the employees spoke some dialect of Chinese. I have no idea about the loan officers, however.

Bellevue's population is ~14% Chinese, over 21,000 people, and mostly high income tech salaries. It would be bad business not to have Chinese speakers on staff.

Yes. But you know, Bellevue is almost as Indian (12%) as it is Chinese (14%), so HSBC is definitely specializing in this case. Not that I'm complaining. They also have a lot of customers who don't speak much english at all, obviously not techies (but maybe the aging parents of techies).

It definitely isn't Richmond though.