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The overall level of risk to Canada’s financial system remains largely unchanged from six months ago, the Bank of Canada said today in the Financial System Review (FSR). The Bank continues to highlight two key vulnerabilities related to Canadian households: high levels of indebtedness and housing market imbalances. A third ongoing vulnerability is the potential for fragility in fixed-income market liquidity.

Nonetheless, the Canadian financial system remains resilient as the nation’s economy improves and financial reforms in Canada and worldwide progress.

Since June, the proportion of highly indebted households has continued to rise in many cities, notably in the Greater Toronto Area. Nationally, house prices continue to increase relative to income, although significant regional divergences persist. Imbalances in some regional housing markets make it more likely that adverse economic shocks could cause large declines in prices.

This buildup of vulnerabilities will be mitigated over time by new federal housing finance rules and other housing sector policies, which will dampen activity in the sector and improve the quality of new mortgages. While the impact of these measures will be concentrated in regions where house prices are the highest relative to income, such as Vancouver, Toronto and Calgary, they will also have important effects at a national level.

“These macroprudential policies will raise the underlying quality of household indebtedness over time, as well as financial institutions’ capital requirements and pricing criteria, which will make them more resilient to future shocks,” Governor Stephen S. Poloz said. “Accordingly, these policies will help mitigate financial stability risks over time.”

In view of the household vulnerabilities identified in the FSR, the most important risk remains household financial stress and a sharp correction in house prices, triggered by a large and persistent nationwide rise in unemployment. The likelihood of this risk materializing, however, remains low.

Other key risks are a sharp increase in long-term interest rates driven by higher global risk premiums, stress emanating from China and emerging-market economies, and prolonged weakness in commodity prices.

Simon Fraser
Market Update

Simon Fraser Condos

Altaire by Polygon

Altaire built in 2008/2009 reaches higher then any other condo building in Metro Vancouver offering panoramic views.

Novo I by Intergulf

Novo I built in 2007 known for the amazing sight lines and views from most units and balconies up to 1000 sq ft.

Novo II by Intergulf

Novo II built in 2007 known for the amazing sight lines and views from most units and balconies up to 1000 sq ft.

Aurora by Polygon

Aurora built in 2006 with 103 condos featuring 36 unique floor plans ranging from 715 sq ft to 1500 sq ft.

One University by Millennium

One University built in 2005 is UniverCity's flagship building with luxury homes featuring semi private elevators.

Harmony by Polygon

Harmony built in 2005 was the first condo development at Univercity & as a result offers a unique setting & views.

Serenity Townhomes by Polygon

Serenity is a collection of 2 bedroom townhomes of 1100 sq ft ranging to 4 bedroom 2000+ sq ft townhomes.

The Hub by Liberty Homes

The Hub built in 2009 is set atop Nester's Grocery and steps from High Street giving these homes an urban feel.

Verdant by VanCity Enterprises

Verdant is a two storey town home building built with environmental design and stylish living spaces which complement the modern exterior of these SFU homes.

Origin by Porte Development

Origin is designed by GBL Architect & BYU Interior Designs, developed by Porte Development Corp. and marketed by Red Dot Real Estate.

Nest by Mosaic

Located on UniverCity High Street across from the new University Highlands elementary schools this refreshing building will add further depth to a growing community.

Highland House by Liberty Homes

A 12-storey concrete high-rise development and targeted towards Rental Investors and First-Time Condo Buyers.

Lift by Porte Development

Lift will be a wood frame building comprising of 56 homes. Building technologies, environmental features, and price points should be similar to Origin.

Altitude by Hungerford Group

Altitude will be a 2 tower development comprising of a 12 and 14 story building with a total of 210 strata units.

CentreBlock by Liberty Homes

CentreBlock at UniverCity atop Burnaby Mountain is the latest condo project with sales commencing early 2014. .

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