Despite its massive losses during the 2008 housing bubble, mortgage insurer Genworth MI Canada Inc.’s newest leader has confirmed that the company is still mulling
real estate investing in Alberta.
Newly appointed president and chief executive Stuart Levings said he is keeping his eyes close to the region’s housing sector since oil prices began dropping.
“Alberta was literally a housing bubble going into 2008,” Levings was quoted as saying by The Globe and Mail
. “House prices went up 15-20 per cent a year, two to three years in a row. It was unheard of.”
He added that “fault lines are not yet showing in the province’s housing market … but they’re coming.”
Genworth MI suffered losses in 2008 as home prices fell 25 per cent and unemployment doubled. The company’s lenders transferred to its government-run rival, Canada Mortgage and Housing Corporation.
Today, Levings appears confident that Alberta is unlikely to face the same crash. The former chief risk officer, however, admitted that unemployment could go as high as 7 per cent and home prices to fall by as much as 10 per cent in the area this year.
Levings added that Genworth is also keen in sending more of its Alberta business to underwriters, noting that the rejection rate has jumped to around 8.5 per cent, slightly higher from the 7 per cent average.
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