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Westbank Proposal for 720 Beatty, Central Heat site
February 3, 2019

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Speculation Tax
January 21, 2019

Does you brain hurt when you think about the myriad taxes on real estate you are facing under this government?  Mine does.  

 

0327 speculation tax map e1522103442410

 

Just in case you have been cut off from media for the past several weeks I am informing you of the necessity to declare the occupancy status of your property for the SPECULATION TAX (which has zero to do with speculation).  Every person on title for every property must submit an exemption if they qualify or else will be charged the tax.  

https://www2.gov.bc.ca/gov/content/taxes/property-taxes/speculation-and-vacancy-tax/exemptions-speculation-and-vacancy-tax

 

What about satellite families?  What is a satellite family?

Here is the definition form the site:

 

People who declare LESS than 50% of their total combined household income for the year on Canadian income tax returns may pay tax at the highest rate and may not be entitled to all exemptions. People in this situation are considered members of a satellite family. This could apply to you even if you are a Canadian citizen or B.C. resident.

Examples:

  • One spouse is a Canadian citizen but isn’t the home owner, while the other spouse is the owner but isn’t a Canadian citizen or permanent resident. Around 70% of their combined worldwide income is earned outside of Canada and is not reported on a Canadian income tax return. Both spouses are members of a satellite family.
  • One spouse owns the home but is out of the country most of the time, earning 100% of his income from outside Canada with no obligation to report to Canada Revenue Agency. The other spouse and their children live in their B.C. house. Since the combined income of these two spouses is entirely unreported on Canadian tax returns, they are both considered members of a satellite family.

Basically, declare or be automatically charged.  (Seems to me this billing model has been deemed illegal for businesses, hmmm.).  

 

tax burden 620x330

 

 

 

Still, Vancouver is once again ranks as one of the healthiest places to live on the planet;).  

https://dailyhive.com/vancouver/vancouver-healthiest-cities-world-2019

 

 


posted under New Taxes On Real Estate

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How About All Those Taxes On Real Estate!
December 15, 2018

Here is a summary of all those taxes applicable to your real estate:

 

  • Property Transfer Tax (PTT)  -  purchasing residential property - increased to 5% (from 3%) of the purchase price for the value above $3,000,000:

  • 1% on 1st $200,000

  • 2% on balance up to $2,000,000

  • 3% on balance above $2,000,000 up to $3,000,000

  • 5% on balance above $3,000,000

 

  • Homeowner Grant - increased to $1.65 million

 

 

  • The City of Vancouver Empty Home Tax “EHT” became effective January 1, 2017. The Empty Home Tax is applied annually with the first taxation year beginning January 1, 2017. The tax for 2017 was payable by April 2018. The tax rate is 1% of the assessed value based on the assessment in the year the tax is paid.

  • The EHT does not apply to a home used as a principal residence or is subject to a long term tenancy agreement of at least 180 days accrued in a calendar year with a minimum of 30 day terms for the tenancies.

  • There are various exemptions for the EHT for situations such as major renovations, major illness, death of the owner, ownership of the property changed curing the previous year, strata rental restrictions that were in place prior to November 16, 2016, homes used for work orders, homes subject to a court order. Explanations for these can be found on the City of Vancouver website https://vancouver.ca/home-property-development/will-your-home-be-taxed.aspx

  • Every residential home owner in the City of Vancouver must submit an Empty Home Declaration by February each year, whether the property is deemed vacant or not. Failure to do so will result in the City declaring the property vacant.

 

 

  • Speculation Tax – https://www2.gov.bc.ca/gov/content/taxes/property-taxes/speculation-and-vacancy-tax

  • The tax applies to residential properties in Capital Regional District (Victoria), Metro Vancouver Regional District excluding Bowen Island, Village of Lions Bay but including the University Endowment Lands and UBC, City of Abbotsford, District of Mission, City of Chilliwack, City of Kelowna and West Kelowna, City of Nanaimo and District of Lantzville

  • The tax will 0.5% for 2018 and 0.5 for Residents of British Columbia and Canadian Citizens and 2% for Foreign Nationals in 2019 and going forward from there.

  • All residential property owners in designated taxable regions of B.C will have to complete an annual declaration for the Speculation and Vacancy Tax to claim any relevant exemptions. Where there are multiple owners of a home, a declaration must be completed by each owner.

  • Declaration will be sent in mid-February and will be due by March 31st each year and any tax owing will be due July 2 of each year

  • Anyone who uses their home as their principal residence is exempt. For this exemption, an owner must be a Canadian citizen or permanent resident of Canada who’s a B.C. resident for income tax purposes and isn’t part of a satellite family

  • Long-term rentals are exempt from the tax.

  • 2018 – Homes must be rented out for at least 3 months.

  • 2019 - Homes must be rented out for at least 6 months, in increments of 30 days or more.

  • Strata buildings with rental restrictions are exempt for 2018 and 2019 only as long as the rental bylaw was in place as of October 2018.

  • Special Case Exemptions:

    • Owner/tenant undergoing medical care, in hospital, long-term care facility

    • Owner/tenant – temporarily absent for work purposes

    • Registered owner is deceased, estate is being processed

    • All exemptions listed here

 




posted under Vancouver Real Estate Market

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November Stats Don't Tell the Whole Story
December 6, 2018

The numbers aren't pretty for Sellers as compared with the past two years, with 24 months of inventory in West Vancouver and East and West Vancouver houses sitting at 13 months inventory. Listingss haven't been increasing drastically however, it is sales that have slowed and with it prices have seen a modest drop which is averaging around 5% overall.  Single family West Side homes have seen the greatest price adjustments, down up to 20% from the highs of 2017 in some cases.  The bulk of the market where most activity takes place--that is condos and townhomes-- has seen a balancing since June and the result is a return to more normal conditions.  Buyers can shop around and write offers with proper due diligence contingencies like home inspection.  This is a perfect market for financially qualified first time buyers and move up buyers who can likely get an accepted subject to sale offer accepted.

Below are the statistics for November sales averages.  They do not tell the whole story though.  For example the West Side condo market under $600,000. actually has only 4 months of supply: 136 active listings and 31 sales in November and half of these listings are priced between $550K and $600K.  At the entry level of the market there is still competition but far less than we have seen since 2012.  With interest rates likely to rise again in March, saavy buyers will see December and January as an opportunity to buy without competition and below the 10 historical average for activity.  Waiting for a bottom is a tricky game.  We can't see it until it has passed and the market is on the way up.  

 

 sales and listings statistics houses townhouses and apartments for november 2018

 

skyline


posted under Vancouver Real Estate Market Update

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Larger Inventory of Homes Has Increased Choices For Buyer
November 15, 2018

Finally, a good supply of properties in the market for Buyers to choose from, and, Buyers are facing less competition than they have in the past couple of years.  This is a GREAT time to buy!

 

 

Slow housing sales boosting supply: BCREA

 

Overall housing market now balanced, but this varies between home types and areas, says BCREA

 

By Glacier Media Real Estate | November 14, 2018, 12:56pm

 

 

 

 

Shutterstock

 

A slow October for residential real estate sales across the province has led to an overall balanced market and a “much-needed” increase in available homes for sale, according to the latest monthly statistics from the B.C. Real Estate Association.

In total, 6,405 homes traded hands on the MLS last month, which is 26.2 per cent lower than October last year. However, that total is a jump of 14.9 per cent compared with the even slower month of September 2018, as the market picked up some fall activity.

Of the 12 B.C. real estate boards, only B.C. Northern –  which takes in the entire northern two-thirds of the province including Prince George and the booming Kitimat – posted a year-over-year increase in home sales last month.

The BCREA said that average home sale price across the province in October was $690,161. That is a decline of 4.1 per cent from October 2017, but a slight month-over-month increase of 0.6 per cent, or $4,412. Only three boards reported an annual price decline, but as one of them was Greater Vancouver, that pulled down the provincial average sale price.

BCREA

The BCREA maintained its stance that mortgage “stress testing” introduced this year was to blame for the slowdown in housing demand. “The B.C. housing market continued to grapple with tougher mortgage qualifications in October,” said Cameron Muir, BCREA’s chief economist. “However, more moderate consumer demand has led to a much-needed increase in the supply of homes for sale.”

The total number of homes listed for sale as of the end of October was up nearly 30 per cent year over year to 36,195 units. The BCREA’s report said, “While the B.C. housing market exhibited balanced conditions overall in October, market conditions do vary between regions and by product type.”

The B.C. boards still in seller’s market territory (above 20 per cent sales-to-active-listings ratios) are Vancouver Island (30.9 per cent), Victoria (29.2 per cent), Powell River (27.7 per cent), B.C. Northern (22.5 per cent) and Kamloops (21.5 per cent). At the other end of the scale, the smaller regions of South Okanagan and Northern Lights are both in overall buyer’s markets. All the other B.C. regions, including Greater Vancouver and the Fraser Valley, are currently in balanced market conditions.

However, even within those markets, conditions differ between home types – for example, detached houses in Greater Vancouver are in a buyer’s market while condos are bordering seller’s market conditions.

Despite the overall market downturn, the BCREA has issued a series of optimistic sales forecasts asserting that the market will recover over the next six months.

Glacier Media Real Esta

 

 

 


posted under Real Estate Market Update

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Watch Out For Changes To Home Equity Lines of Credit
November 9, 2018

A quiet rule change will make it tougher for Canadians with a HELOC to get a second mortgage

 

ROBERT MCLISTER
SPECIAL TO THE GLOBE AND MAIL
PUBLISHED NOVEMBER 7, 2018UPDATED NOVEMBER 8, 2018
 
 

Got a home-equity line of credit (HELOC)?

Want to get a new mortgage?

Lenders are about to make your life harder.

 

Canada’s No. 1 player in HELOCs, Toronto-Dominion Bank, just changed a key policy on Tuesday.

For people applying for a separate new mortgage and keeping their existing HELOC, TD is requiring that applicants prove they can afford a theoretical monthly payment based on the limit – not the outstanding balance – of that HELOC.

 

TD joins a small number of other lenders, including Royal Bank of Canada, in applying this new policy.

It’s a stealth rule change if there ever was one. As of the time this is being written, the Office of the Superintendent of Financial Institutions (OSFI), Canada’s banking regulator, hasn’t explicitly claimed responsibility for it.

Without a doubt, this could incrementally depress the cottage, second-home and rental markets. We’re not talking a market crash, here, but every credit-policy tightening adds up and weighs on home prices.

Here’s who it affects

If you are getting a new HELOC, all the banks will “stress test” you on the HELOC credit limit. In other words, they’ll add an assumed payment to your mortgage application, based on the greater of the government’s benchmark posted rate (5.34 per cent currently) or the lender’s contract rate plus two percentage points (around 6.45 per cent.) It’s worked like that for a while, so no change there.

If you are merely renewing a mortgage, there is also no impact whatsoever. It’s those people who are getting an additional mortgage and keeping their existing HELOC who get hit.

The impact

For an average affected borrower with a $200,000 HELOC, suddenly they’ll have to prove they can afford a $1,202 HELOC payment (based on today’s rates). That could drive a typical borrower’s debt ratio above the typical lender’s maximum limits.

Fortunately for many would-be borrowers, very few lenders have applied this policy – yet. By next year, however, I’d bet that all major banks will, as will scores of other lenders that get their funding from big banks.

Hypocrisy, anyone?

HELOCs have been growing like the cannabis market. Okay, maybe not that fast, but fast.

 

But many borrowers never walk into a bank and ask for a HELOC. They are sold a HELOC.

The Financial Consumer Agency of Canada (FCAC) says, “banks reported to FCAC that a readvanceable mortgage [a mortgage linked to a HELOC] is now the default option offered to credit-worthy mortgage customers with down payments of at least 20 per cent.”

You see, HELOCs not only increase bank profits, they build fences around borrowers at renewal. That’s because borrowers must usually pay more to switch lenders if they have a “collateral charge” – another word for a HELOC.

Lenders often try to approve borrowers for the maximum amount, says broker Shawn Stillman, of Mortgage Outlet. “Banks have been pushing HELOCs for years,” he says. (To be fair, a lot of brokers push HELOCs, too.)

“It’s very hypocritical that banks have been promoting lines of credit and telling people, “Don’t worry, this big HELOC will never impact you. And now the banks are changing the rules of the game…"

Better safe than sorry

Regardless of what banks have been doing, they’re now doing the right thing, many argue. And OSFI would likely agree. On Tuesday, it said in an e-mail to me:

“When underwriting any loan application where the borrower has an existing HELOC in place, FRFIs (federally regulated financial institutions) may use either the limit, or outstanding balance of the HELOC, to estimate an ‘assumed payment’ in calculating the Total Debt Service Ratio (TDSR) for this loan application. It is at their discretion, however OSFI expects that, given the revolving nature of a HELOC facility, FRFIs will take a longer term (and conservative) view of the borrower’s debt servicing requirements.”

In announcing these changes in HELOC policy, TD says its “debt service ratio change was made to ensure prudent underwriting guidelines and reflects concerns around consumers’ abilities to manage debt – particularly in a fluctuating rate environment.”

So, it’s understandable why this is happening, the fallout for those affected notwithstanding. There will be side effects. People with HELOCs who want to buy another property will have to:· Find a lender that doesn’t apply this policy (at a potentially higher interest rate);

· Reduce their HELOC limit in order to pass the stress test;

· Lock in their HELOC to a regular amortizing mortgage – not ideal if the borrower wants to pay off that debt without penalty and easily (and quickly) re-borrow for future needs;

· Close their HELOC.

If you’re thinking about getting a second property and want to retain your HELOC, act before year-end. But don’t get more financing than you can afford simply because of this new rule. Otherwise, you’ll be the person that regulators may be targeting with this policy.

Robert McLister is a founder of RateSpy.com and intelliMortgage. You can follow him on Twitter at @RateSpy


posted under Credit

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October Sales almost 27% below 10 year average
November 5, 2018
 

October 2018 Media Stats Package

November 02, 2018
Infographic-October2018-portal

Home listings at four-year October high as sales remain below typical levels

Home sale activity across Metro Vancouver* remained below long-term historical averages in October.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,966 in October 2018, a 34.9 per cent decrease from the 3,022 sales recorded in October 2017, and a 23.3 per cent increase compared to September 2018 when 1,595 homes sold.

Last month’s sales were 26.8 per cent below the 10-year October sales average.

“The supply of homes for sale today is beginning to return to levels that we haven’t seen in our market in about four years,” Phil Moore, REBGV president said. “For home buyers, this means you have more selection to choose from. For sellers, it means your home may face more competition, from other listings, in the marketplace.”

There were 4,873 detached, attached and apartment homes newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in October 2018. This represents a 7.4 per cent increase compared to the 4,539 homes listed in October 2017 and a 7.7 per cent decrease compared to September 2018 when 5,279 homes were listed.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 12,984, a 42.1 per cent increase compared to October 2017 (9,137) and a 0.8 per cent decrease compared to September 2018 (13,084).

For all property types, the sales-to-active listings ratio for October 2018 is 15.1 per cent. By property type, the ratio is 10.3 per cent for detached homes, 17.3 per cent for townhomes, and 20.6 per cent for condominiums.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“Home prices have edged down between three and five per cent, depending on housing type, in our region since June,” said Moore. “This is providing a little relief for those looking to buy compared to the all-time highs we’ve experienced over the last year.”

The MLS® Home Price Index composite benchmark price for all residential homes in Metro Vancouver is currently $1,062,100. This represents a one per cent increase over October 2017 and a 3.3 per cent decrease over the last three months.

Sales of detached homes in October 2018 reached 637, a 32.2 per cent decrease from the 940 detached sales recorded in October 2017. The benchmark price for detached properties is $1,524,000. This represents a 5.1 per cent decrease from October 2017 and a 3.9 per cent decrease over the last three months.

Sales of apartments reached 985 in October 2018, a 35.7 per cent decrease compared to the 1,532 sales in October 2017. The benchmark price of an apartment property is $683,500. This represents a 5.8 per cent increase from October 2017 and a 3.1 per cent decrease over the last three months.

Attached homes sales in October 2018 totalled 344, a 37.5 per cent decrease compared to the 550 sales in October 2017. The benchmark price of an attached home is $829,200. This represents a 4.4 per cent increase from October 2017 and a 2.8 per cent decrease over the last three months.

*Editor’s Note:

Areas covered by the Real Estate Board of Greater Vancouver include: Whistler, Sunshine Coast, Squamish, West Vancouver, North Vancouver, Vancouver, Burnaby, New Westminster, Richmond, Port Moody, Port Coquitlam, Coquitlam, Pitt Meadows, Maple Ridge, and South Delta.

The real estate industry is a key economic driver in British Columbia. In 2017, 35,993 homes changed ownership in the Board’s area, generating $2.4 billion in economic spin-off activity and an estimated 17,600 jobs. The total dollar value of residential sales transacted through the MLS® system in Greater Vancouver totalled $37 billion in 2017.


posted under Real Estate Market Update

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September Sales Video from REBGV
October 12, 2018

posted under Vancouver Real Estate Market Update

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99% of Single Family Lots Approved For Duplex Zoning
September 20, 2018

City of Vancouver Council have approved changes to the zoning of almost all RS zones from single family to duplex.  Shaughnessy between 37th ave and 49th ave and Cypress to Granville are exempt.

Read the story here

 

modern duplex


posted under Vancouver Real Estate

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Cedar Cottage and Kitsilano Zoning Changes Proposed by C.O.V.
September 8, 2018

Tuesday September 18th, 3:00 at City Hall, hearing to discuss changes to RT-7 and RT-8 zones to allow suites withing duplexes and laneway homes:

Visit COV's web page:  


posted under Increasing Density in Vancouver

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