Suspended mortgage broker deals in mortgages for 9 years unlicensed

Neil Sharma
Mortgage Broker News

A broker in Vancouver who was suspended over a decade ago has been slapped with an order to cease and desist activities by the Financial Institutions Commission (FICOM) after arranging $511.6 million in mortgage loans.

Jay Kanth Chaudhary was also found to have a vast network of registered submortgage brokers that operated together between 2009—the year after his license was suspended—and 2018. Vancouver police and FICOM staff entered Chaudhary’s premises and seized his computers and documents, the latter of which included a spreadsheet with 875 files worth $5.28m in client fees and $642,344 in referral fees “paid by the registered submortgage brokers who submitted the applications to lenders on his behalf,” according to a FICOM notice posted online last week.

Chaudhary was first suspended in 2008 after lenders raised concerns about his conduct. The latest notice alleges Chaudhary fooled borrowers into believing he was a broker who dealt with lenders directly. Moreover, he’s accused of collecting referral fees and submitting false or altered documents to brokers who filed on his behalf.

In the middle of 2017, two complaints were brought to the Registrar of Mortgage Brokers, and upon investigating Chaudhary determined 25 out of 26 mortgage applications submitted to CMLS Financial Ltd. on his behalf by an unnamed broker included altered Canada Revenue Agency tax documents.

BlueShore Financial internally audited mortgage files submitted by the unnamed broker between 2012 and 2017 and realized that 15 out of 48 had discrepancies. More than half of the tainted files were insured by either Genworth or the Canada Housing and Mortgage Corporation.

Chaudhary also operated with different aliases, phone numbers and email addresses to fix mortgages with false information, according to the FICOM order. Not only did Chaudhary bloat incomes, he included the names of accounting firms that weren’t, in fact, involved with preparing the files.

One of the spreadsheets identified at least 20 registered submortgage brokers and realtors Chaudhary relied upon for referrals.

Copyright © 2019 Key Media

Existing policies and market conditions in BC prevent many buyers and sellers from fully participating in the market

Ephraim Vecina
Canadian Real Estate Wealth

Existing policies and market conditions in BC prevent many buyers and sellers from fully participating in the market, according to Vancouver’s Central 1 Credit Union.

The firm found that home sales in the province decreased by a massive 40% since the end of 2018. Currently, hopeful buyers are hesitating due to high price levels, while potential sellers would rather wait on the sidelines for a market recovery.

Stricter federal and provincial regulations were cited to be major factors slowing down activity, the analysis noted. Among the most damaging of these policies were B-20 (which weakened purchasing power by 20%) and BC’s 20% foreign buyer tax (which forced capital holders to invest elsewhere).

Even BC’s likely robust economic performance this year will not be able to offset these weaknesses, Central 1 deputy chief economist Bryan Yu said. Residential sales are estimated to further decrease by 11% in 2019.

And the actual situation this year might even be worse: Yu cautioned that the analysis did not take into account the possible effects of money laundering.

“These were model-driven numbers based on international numbers and I would say very little localized information,” Yu told The Canadian Press. “It seems to me we’re really still searching for those numbers and trying to get a better grasp of them.”

The results of a government report released last month indicated that dirty money inflated BC residential property prices by approximately 5% last year. Finance Minister Carole James also stated that money laundering could have “distorted” the Metro Vancouver housing market by as much as 20%.

Copyright © 2019 Key Media Pty Ltd

Willow + Oak a draw for first-time buyers

Simon Briault
The Vancouver Sun

Willow + Oak

Project location: 11272 – 240th Street, Maple Ridge

Project size and prices: 59 homes – 54 townhouses and five single-family homes. Townhomes range in size from 1,385 to 2,000 square feet. The two-bedroom homes start at $479,980, three-bedroom homes and den begin at $499,980, four-bedroom homes with side-by-side double garages at $639,980; Single-family homes to be released for sale in 2020

Developer: Main Street Homes

Architect: Formwerks Architectural

Interior designer: Leanne Leon, E2 Homes Ltd.

Sales centre: 11272 240th street

Sales centre hours: noon — 6 p.m., daily

Sales phone: 604-463-8880

Website: www.willowandoak.ca

Build it and they will come. Not too long ago, that’s pretty much all a developer of multi-family housing in the Lower Mainland had to do. These days, with home sales falling and buyers being more discerning about where they put their money, the market is much more complicated. But Janine Mackie, sales manager at Main Street Homes, believes there’s still healthy demand for homes that offer real value, particularly for first-time buyers.

Main Street Homes is the developer behind a new townhome development in Maple Ridge called Willow + Oak, which has been doing a roaring trade with young couples and millennials.

“You hear so much doom and gloom in the media about homes not selling, but it’s all about offering something where people can see some real value with a great price point and good quality product,” Mackie said. “Before we came to market here in Maple Ridge, we did a lot of research. When you have a grand opening, you don’t want to be sitting there and nobody coming in. We felt there was nothing comparable out there for under $550,000 so we launched on opening day with homes starting at $479,980 and people just didn’t stop coming in all day.”

When it’s fully built out, Willow + Oak will be a community of 59 homes – 54 townhouses and five single-family homes. Two-bedroom townhomes start at the above-mentioned $479,980, three-bedroom and den homes begin at $499,980, and four-bedroom homes at $639,980. The single-family homes will be released for sale in 2020.

“First-time buyers have been forgotten in the market or have been unable to find a home at a price point that they can afford,” Mackie added. “There’s been a lot of excitement – young people coming in having thought they couldn’t afford a home or would have to stay in a condo, people telling us they just had to get out of their parents’ basement.”

Alison and Ryan Charters have bought a three-bedroom, two-and-a-half bathroom townhome at Willow + Oak and will be moving from North Vancouver into their new home this summer. It’s no surprise that the more affordable price played a big part in their decision.

“My husband works in Maple Ridge,” Alison Charters said. “He’s been watching the developments being built from the ground up and was very interested in Willow + Oak even before we knew the price point.”

“Ryan is looking forward to a much shorter commute, which will go from about an hour and a half to five minutes, which is a big bonus for him,” Charters added. “I’m originally from Ontario, so the whole region is new to me, but what I’m looking forward to about Maple Ridge is that it’s supposed to be a really family-oriented area. I think we’ll find a lot of people in our situation – young families and first-time homebuyers. We’ll have our baby growing up with people the same age.”

The neighbourhood that Charters will be moving to has a lot to offer, according to Mackie. Willow + Oak is located in a rapidly growing area of Maple Ridge, with a new Starbucks and a Save-On-Foods just down the street and plans for more commercial outlets coming soon.

“A lot of our buyers don’t have a history in Maple Ridge, but they’re willing to move from places like North Vancouver, Coquitlam, Surrey, Burnaby or New Westminster with a sense of adventure about what this area has to offer,” Mackie said. “There’s excellent access to nature here and a great town centre with all different ethnicities represented in the restaurant scene.”

“Right outside your door you can catch a bus that connects you directly with the West Coast Express for a stress-free commute to work,” Mackie added. “The Kanaka Creek Regional Park is five minutes from your door and our site is actually bordered by a protected green space. It’s also only about 15 minutes away from Golden Ears Park. There’s definitely a natural, laid-back, small-town feel here.”

Most homes at Willow + Oak have side-by-side garages. There are rear decks or patios to expand the living spaces, powder rooms on the main floors and Tudor-inspired exterior finishes. Kitchens come with custom Shaker-style cabinetry, soft-close doors and drawers, engineered quartz countertops, gas ranges and Samsung appliance packages.

Bathrooms feature four-foot walk-in showers, quartz countertops, dual vanities in all ensuites and hand-set ceramic tiles.

Instead of standard electric baseboard heaters, homes at Willow + Oak will have a new kind of convection heating that can, according to Mackie, save homeowners up to 40 per cent on their heating bills.

“On the main floors we’ve got a really nice open concept and it really feels and flows like a single-family home with high ceilings and oversized windows,” said Mackie. “We’ve fine-tuned our specifications to be able to offer great value. People want to be able to get into the market and that’s exactly what we’re offering.”

© 2019 Postmedia Network Inc.

The city’s “stunning” growth has a downside

Daniel Tencer
other

Torontonians could find themselves “doubling up” on housing with friends or relatives in the coming years as the city’s breakneck population growth outstrips the supply of new housing, an urban planning expert is warning.

In an analysis published online this week, researchers Frank Clayton and Eva Shi of Ryerson University’s Centre for Urban Research and Land Development found that Toronto is the fastest-growing city in the U.S. or Canada, and by a long shot. The city added more than 77,000 net new residents in the year ending in July, 2018, more than three times as many people as the next municipality, Phoenix, Ariz.

The researchers describe this rate of growth as “stunning.”

Looking at metro areas, Greater Toronto had the second-fastest population growth, behind only Dallas-Fort Worth. Greater Montreal was the sixth-fastest growing metro.

But while that may look like success from some perspectives, it means the city is risking a serious housing crisis, study co-author Frank Clayton said.

The region may see a repeat of the situation from the early 1990s, when developers pulled back on home construction amid falling house prices, but the population kept growing.

People found themselves “doubling up” or “tripling up” on housing, often with more than one generation of family living in a single home, Clayton said.

That effect could be particularly strong today, given that younger Canadians are already increasingly living with their parents. 

“In the ’90s, immigration was very strong but it wasn’t showing up in the housing demand numbers,” Clayton, a real estate and urban economist, told HuffPost Canada by phone.

As is the case now, affordability was at multi-year lows. But unlike today, the economy was shrinking in the early 1990s, with the region losing some 200,000 jobs amidst a North American recession. Interest rates were high, making mortgages prohibitively expensive. The result was that developers couldn’t unload empty condos even as residents were forced into shared housing.

Today’s home sales slowdown could result in something similar. Data from Canada Mortgage and Housing Corp. shows developers are reacting to the slowdown by cutting back on new construction.

© Huffpost