Home Capital Group says the review of its suspended mortgage brokers is now 90 per cent complete.
President and CEO Martin Reid told BNN that the review wasn’t a ‘big event’ for his company.
“There have been no unusual credit events,” he said about the review stemming from the suspension of 45 mortgage brokers, adding that less than 10 per cent of the affected mortgages would not be renewed.
Reid said that because of the hot real estate market, the company is typically requiring a bigger down payment today than they would have two or three years ago.
“It really is tough though for the first-time buyer,” he said. “The flip side to that is with higher interest rates affordability has been manageable. We are seeing more assistance from family members for younger people buying houses.”
Recent events like the introduction of the 15 per cent tax against foreign homebuyers in B.C. doesn’t have Home Capital Group worried either.
“We typically don’t deal with foreigners – we are dealing with people with landed status,” Reid said. “It will impact the market a little bit, but we don’t think it’s going to be a dramatic impact.”
To lessen the worries about the hot housing market even further, Reid said that the company is already seeing slowing activity in Vancouver.
“We’ve argued that the price growth that both Toronto and Vancouver have been seeing are not sustainable,” he said.
Home Capital Group reported its second-quarter earnings Wednesday with total originations increasing 22 per cent year over year and said its top priority is growing those volumes even more.
Reid said that “there’s still a lot more room for growth” for the company in the mortgage product area even in “a higher-risk real estate market.”