Home Economics: Alarm bells ring over housing investors; Beware when buying into IPOs

The Bank of Canada calls out real estate investors for raising correction risks in the housing market, CIBC supersizes Costco Mastercard benefits and younger Canadians are checking their credit scores more often - but don't fully understand them

Spotlight on housing investors – friend or foe?  Real estate investors have been top of mind more than usual this week with the Bank of Canada, banking regulator and other market watchers sounding the alarm on the prevalence of investors in the housing sector. The Bank of Canada warned investors are raising the risk of a housing market correction. The head of Canada’s banking watchdog called for more action to correct the supply-demand imbalance but also said housing investors aren’t the enemy — they’re just trying to make a profit in a free-market economy. Meanwhile, the founder of rate comparison website RateSpy.com questioned whether the housing market could be in for a GameStop-style crash, if investors became spooked and rushed out of the market. CIBC supersizes benefits of Costco Mastercards  CIBC is revealing a slew of new benefits it has planned when it replaces Capital One as the issuer of Costco Mastercards. In particular, CIBC is more than doubling the amount of cash back cardholders can receive. It’s also adding auto insurance and pay-by-instalment features. Some CIBC analysts believe the bank’s main motivation with acquiring the card business is to lure cardholders into its suite of offerings. Polls find Canadians are ready to spend big this holiday season  Canadians are in the holiday spirit this year as in-store shopping and in-person celebrations make their triumphant return. A number of surveys have found Canadians will spend more on the holidays this season, including a poll from Accenture Canada, which suggested shoppers will spend an average of $635, an increase of $119 compared to 2020. Canadians have been encouraged to shop early because of supply chain disruptions and possible product shortages.  Younger Canadians checking their credit scores but many still unsure of how they work  The good news is young people are checking their credit reports more often. The bad news is many of them still believe misconceptions about credit reports and scores. That’s according to a new Equifax survey. One of the top myths? Many believe that if you have a good credit score, you’ll always be approved for a loan. It’s “buyer beware” when buying into IPOs  Companies that make their public market debut are more often than not met with volatility in their stock price. JC Clark CEO Colin Stewart says retail investors need to do their own homework and determine whether the company they’re buying into is a fundamentally sound business. He also warned against basing your buying decisions on whether the IPO market is hot or not. 

A new survey for BNN Bloomberg and RATESDOTCA found 29 per cent of respondents who have, or are planning to get, a mortgage were unclear about how rising interest rates would impact their payments.