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Vancouver 2010 Olympic wrap up video!

As many of you might have seen on TV, the city of Vancouver has been absolute mayhem during the 16 days of the 2010 Winter Olympics.

We’ve been working to prepare for this event for the past 7 years…and despite the controversial glitches in the beginning of the event Canada managed to pull it together and emerged victorious at the final US vs Canada hockey game for the goal medal. We ended up winning 14 gold medals, the most gold medals ever won by the Olympic host country.

Several events were held in the Downtown core of Vancouver, including live concerts, light shows, ziplining down Robson Street (which supposedly had a 7 hour wait), and parties virtually everywhere; Granville Street, Vancouver’s main nightlife strip, was just packed during the night hours. Several pavilions were open showcasing the different provinces in Canada and the different countries participating in the games.

I myself visited Downtown a few times during the games, but the most memorable visit had to be after the Closing Ceremonies…walking down Granville was an experience for sure, and it made me so proud to live in this country with such patriotic residents. People dressed in red and white were walking down the streets high-fiving random people in opposing traffic, screaming and cheering and having a blast…all without getting into trouble! There was security probably every few feet but not a single fight could be spotted. At least by us.

It’s not often which we get to experience such a magnificent event in your own city! Hopefully you’ll enjoy the video, which shows a little bit of the Downtown mayhem, both day and night.

Posted 5 Year Rate Confirmed As New Qualifying Rate

It has now been confirmed that the new qualifying rate, effective April 19, 2010, for all CMHC insured mortgages will be as follows:

  The greater of the chartered bank’s posted 5 year term rate or the contract rate.

This will apply to all variable rate mortgages and for fixed rate terms under 5 years.

We were all waiting to find out what the new qualifying rate would be ever since the Federal Finance Department announced changes back on February 16, 2010.

As of today the qualifying rate would be 5.39%.

This is a significant setback to borrowers and to many non-bank lenders. For all borrowers this will mean that they will be qualifying for much less money post April 19 compared to now. To many non-bank lenders, who have been qualifying many of their applicants on discounted 3-year fixed rates currently for variable rate products, this will level the playing field with their bank competitors. It may have an impact on their bottom line as this current policy had given them edge in attracting would be borrowers who needed just a bit more money.

As an illustration on the impact, below is the amount a borrower can get using three different scenarios. In all of them I am using an income of $60,000 per annum, a 25 year amortization, the assumption of no other debts, a 32% GDSR and a figure of $2500 per annum for property tax and heat.

1. One non-bank lender today is using 3.65% as a qualifying rate for their variable rate mortgages. $274,000
2. Using today’s 5 year fixed discounted rate from many lenders of 3.79%. $270,000
3. After April 19, 2010 assuming the qualifying rate is today’s bank posted 5 year rate of 5.39%. $230,000

A client in this example would be able to borrow $40,000 LESS going with a variable rate product after April 19, 2010 compared to today.

Although this has only been announced by CMHC, I anticipate other insurers (Genworth, AIG) to follow this government set mandate as well.

If current mortgage volumes are any indication, we will see a continued surge in clients attempting to finalize their mortgages prior to the new rules implementation.

As always your comments and feedback are welcome.

Wayne Mah, Senior Mortgage Planner, The Mortgage Centre 604.880.1899 / mah.w@mortgagecentre.com

Pre-Olympic Vancouver Real Estate Market Update

We are days away from opening ceremonies for the 2010 Olympic Games here in Vancouver BC. The city has never looked so beautiful! Within all the buzz and excitement lies a question that Vancouverites and many others around the world are speculating; “What effect will the 2010 Olympic Games have on Vancouver Real Estate?” Now this is a question that no one can answer as no one can predict the future.

Opinions are very divided. To be honest, I could personally argue all possibilities. It comes down to the basic economic principal of supply and demand. A few questions to ask yourself (amongst many) would include:

1. Economy:
How will the state of our economy post Olympics affect the housing market?

2. Foreign Investment:
With the spotlight on Vancouver will we see an increase in foreign investment?

3. Interest Rates:
What will the bank of Canada do with interest rates? Will the cost of borrowing increase significantly?

4. Pricing:
Many people are holding off with the dealings of Real Estate in Vancouver until after the 2010 Olympics. Will this bring a rise in supply or demand? Or balance eachother out keeping prices stabalized?

Obviously none of us have a crystal ball and so it’s impossible to tell what exactly will happen. It should be a very interesting year for us here in Vancouver though, and I’ll be sure to keep you posted with occurances and events as they come along.

First Time Home Buyer Property Transfer Tax (PTT) Exemption

What is Property Transfer Tax (PTT)? For those of you who don’t know, it’s a tax that is payable to the provincial government when acquiring an interest in or purchasing a property, and this is assumed by the buyer. Many first time home buyers are aware but not clear on their rights towards their property transfer tax exemption with their first real estate purchase. I get asked this question on a regular basis, especially from US and US/CDN dual citizens. As a first time home buyer you may qualify for an exemption in you property transfer tax. To qualify you must meet all of the following criteria:

1) Must be a Canadian Citizen or Permanent Canadian Resident.
2) Must have resided in British Columbia for the past year, and at least 2 of the last 6 taxable years.
3) Must have never held title to property anywhere internationally at any given time.
4) Must not have applied for the property transfer tax exemption previously.
5) To obtain full exemption, the purchase price must not exceed $425,000 CDN. A partial exemption is available for homes between $425,000 and $450,000.

For more detailed information you may contact me at any time, at laura@vancouverpowersearch.com.

Looking for an investment? Check out these villas on the fairway!

Recently I ran into an interesting investment opportunity in Chilliwack, BC, the warmest city in Canada. In Chilliwack rests one of “BC’s best hidden kept secrets”, The Falls Golf & Country Club, home to a breathtaking golf course with expansive views of the hillsides and from Abbotsford to Harrison.

There are currently some big development plans underway in the immediate vacinity including a $250 million dollar multi use sports facility and winter club, with what is going to be one of the world’s largest usable green roof. Read more about it here.

Right on the fairway there is a new construction development, a group of duplex-style homes called the Deercrest Villas. Why are these special, and why are they investment opportunities? These villas are meant to be rentals; purchasers, upon putting a deposit down, sign an agreement with the Falls resort to manage the villa (if they wish to do so, they can of course reside in the property if they’d like to). The Falls then takes care of the leasing of the unit for you.  Since the villas are zoned the same as a hotel is, overnight rentals are legally allowed; visitors can get room service and even spa services right to, and in, their rooms! Another intriguing fact: Australian golf legend Greg Norman is signed on to design the next course in the club. Properties on fairways designed by him typically sell in the mid $2 million dollar range.

See what people are saying about the Falls:

“Home buyers, young families, retirees, and golfers will be treated to a panorama of mountain peaks that form a backdrop to farms that dot the valley below” – New York Times

“One of B.C.’s Top Ten Hidden Treasures” – National Post Golf Review

“Ranked in Top 100 World Destinations for Fishing and Golf” – TSN’s Fins and Skins

“Ranked #2 for B.C.’s Best Scenery, B.C.’s Favorite Course and B.C.’s Best Kept Secret” – Province Golf Guide  (Golfer’s Choice, Best of B.C.)

“One of the most spectacular golf courses I have ever played!” – Steve Tambellini, VP & Assistant General Manager, Vancouver Canucks

“Our Canucks Alumni Ryder Tournament that we play at the Falls each June is indeed a high point on our social calendar. The golf course, the views, the food and the hospitality we’re shown are top notch and sincerely appreciated” – Norm Jewison, Vancouver Canucks Alumni Liaison

There are 8 phases in this development and the first phase has already sold out. The second phase, currently 50% sold out, are for sale for $840,000 and are fully finished ($40,000 is for the furnishings). The third phase and phases thereafter aren’t on the fairway, so phase 2 is your last opportunity for a villa on the fairway! Third phase units are offered at $740,000. For information on what the nightly rate and other financial information, give me a call or send me an email! (trust me, it’s worth taking a look at).

The villas themselves are absolutely gorgeous. They’re basically luxury townhouses, with high end finishings such as granite countertops, two jacuzzi tubs (one in the master, one on the outdoor patio overlooking the fairway), flat screen TVs, hardwood flooring…the list goes on.

The Falls are also offering an incentive at the moment where they’re writing purchasers post dated checks for 1/2 year’s worth of mortgage and property tax payments. Have you heard of that one before? I know I haven’t. To date, not one single investor who has invested in a Deercrest villa has had to pay out anything other than their mortgage downpayment, as everything else has been covered by the rental revenue they have received, and some!

Want to learn more? Get in touch! I’d be happy to send you more detailed information on these properties. Also be sure to visit the Falls website!

Amy Kizaki
Blu Realty
778 855 0841
amy@vancouverpowersearch.com

Tax Assessed Value vs Fair Market Value?

In just this past month, I’ve had 3 buyers tell me that they aren’t willing to pay much higher above what the tax assessed value of the property is. Reason? They all seem to be under the impression that tax assessed value equals what the price of the property should be.

It’s because of this misconception that some listing agents write things such as “priced under assessed value” etc in their marketing remarks, and in turn, partially because of those marketing remarks properties priced under assessed value have been deemed good deals. This is not necessarily true.

ASSESSED VALUE is a valuation placed on property by a public tax assessor (in BC it’s a provincial crown corporation called BC Assessment) for purposes of taxation. Tax authorities, for example the City of Vancouver, then apply their own tax rates to the assessments provided.

FAIR MARKET VALUE is the price that a knowledgable, willing and unpressured buyer is willing to pay to an owner who is willing and is under no obligation to sell their property. Prior to listing a property, the listing agent typically will pull up comparable properties that sold in the last 3-6 months, depending on what they find. They then guide the seller as to how to price their property. The agreed upon price between a buyer and seller effectively becomes the fair market value of that property. This is also why you should take a look at comparable sold listings prior to making an offer; it’s a great way to determine whether the subject property is priced accurately.

Have any questions? Feel free to reach me or my partner Laura at any time.

Amy Kizaki
Team Leader
Vancouver PowerSearch

778 855 0841 direct
604 209 3674 Laura direct
amy@vancouverpowersearch.com
laura@vancouverpowersearch.com

Coal Harbour Video Tour

Amy and Laura take you on a tour of one of Downtown Vancouver’s waterfront communities, Coal Harbour.

Coal Harbour is located on the southern shores of the Burrard Inlet and is home to one of Vancouver’s more prestigious marinas, Coal Harbour marina (which is also one of the two marinas that will accommodate larger boats with 330′ slips.

The boundaries of Coal Harbour are Georgia Street, Denman Street, Burrard Street, and the waterfront.  Here you will find condominium units in newer highrise buildings, many with fantastic views of the Burrard Inlet, North Shore Mountains, Stanley Park and the marina. Studios start right on the $300,000 mark, one bedrooms in the mid $300,000’s and two bedroom units start in the higher $500,000 range.

The seawall starts in Coal Harbour and trails along the edges of Stanley Park back to the West End community. The Downtown waterfront is home to the new green-built, state of the art convention centre, a close to $900 million dollar project which will be the meeting grounds for the 2010 Olympic staff. Trendy furniture boutiques, yacht sale broekrages and seafood-type restaurants also line the seawall.

Want to know more about Coal Harbour real estate or would like to see some listings? Call or email us. Amy or Laura at 778 855 0841 or 604 209 3674!

amy@vancouverpowersearch.com
laura@vancouverpowersearch.com

Have you used your home renovation tax credit?

Deadline is approaching! At the end of January 2010, the Federal Home Renovation Tax Credit incentive, part of Canada’s economic action plan, will be coming to an end. If you’re a Canadian homeowner and were thinking of a kitchen remodel or finally landscaping your front or back yard…time to move.

Here’s the low-down on the Home Renovation Tax Credit.

What is it? : It’s a federal non-refundable tax credit based on eligible expenses for improvements to your house, condo or cottage exceeding $1,000 but not more than $10,000.

Maximum credit: $1,350.
Valid period: Purchases made before February 1, 2010.

Eligible expenses must be of an enduring nature and integral to your property (no, new TVs or lawn mowers don’t count, sorry).

Be sure to get your contracts in writing, and keep your receipts. Claim the credit on your 2009 income tax return at the time of filing.

Examples of Eligible Expenses:

• Kitchen, bathroom, basement renovations
• New windows, doors, flooring
• Major remodels such as building an addition, garage, deck, shed or fence
• A new furnace, woodstove, fireplace, water softener, water heater
• A new driveway or resurfacing a driveway, re-shingling a roof, or painting of a house
• Landscaping- new sod, perennial shrubs and flowers, trees, etc
• Swimming pools (must be permanent, in and above ground)
• Fixtures- blinds, shades, shutters, awnings, lights, fans, etc
• Associated costs such as permits, professional services, equipment rentals, and incidental expenses

Examples of Non-eligible Expenses

• Furniture, appliances, tools, and audio and visual electronics
• Routine repairs, maintenance and cleaning (eg. furnace cleaning, snow removal, lawn care, pool cleaning, house cleaning)
• Financing costs

For more information on the tax credit, call 1-877-959-1CRA or visit www.actionplan.gc.ca.

Hope that you’ve all had a fantastic holiday season and a great New Years! 2010 is going to be an exciting year for Vancouver and we wish you all the best as well!

Facts on HST and how it will affect BC Real Estate

How will the new Harmonized Sales Tax affect Real Estate purchases in Vancouver? This is a question that I been recently asked over and over. My answer is not as much as most people think.

HST is a 12% sales tax that will be implemented in July of 2010. This tax will replace the current 5% government sales tax combined with the 7% provincial sales tax that currently exists. Listed below are the key facts that will influence your Vancouver Real Estate purchase:

1. HST will affect the purchase of NEW homes. Currently there is only a 5% federal tax for the purchases of new contruction. This tax will be replaced by th 12% HST as of July 2010.

2. The government has announced that any new properties costing up to $525,000 will be exempt from the new tax. The original government proposed amount was $400,000. This represents a 30% increase in the exemption amount.

3. For new construction costing more than $525,000, the government has announced a provincial tax rebate program for the HST paid on a new home purchases. This amount has increased to $26,250 from the original $20,000 rebate announced when the proposed HST was originally released to the media. Again, this represents a 30% increase.

4. HST will be applicable to the costs and fees associated with a Real Estate transaction. This will include fees regarding any home inspections, legal work, comissions and any other closing costs that are part of a Real Estate purchase.

5. HST will also be applicable to many monthly costs associated with running a household. These costs include monthly strata fees, cable, internet, gas and electricity just to name a few.

The question that you are probably asking yourself righ now is “Will there be anything exempt from HST?!?” The answer is, “Not much”. I say this in regards to all pruchases not even related to Real Estate.

In saying that, unless you are planning on purchasing new construction, HST will not affect you a whole lot. Real Estate transactions that are not new construction will be exempt from HST. In this case, the only additional tax costs will be on costs/fees associated with the transaction.

West End Video Tour!

The West End is, in my opinion, Vancouver’s in-city suburb. The West End is the only area you will find in Downtown Vancouver where detached residential homes exist on tree-lined streets. Homes in this area are older heritage homes, with many Craftsmen style homes (strating in the lower million dollar range) that have been converted to duplexes and triplexes. The rental rate is some of the highest in this community of the Downtown Vancouver area so for investors looking for small rental investments, the area is ideal.

Just blocks away from the neighborhood is one of the city’s most populous beaches, English Bay. The close-by commercial corridors, Robson, Denman and Davie are also a 5 minute walk from the residential area and thus makes it a great home for those who like a more quiet lifestyle without the hustle and bustle of Downtown Vancouver.

Condos here can be found starting in the higher $200,000’s and lower $300,000’s. Buildings here tend to be older as most of the highrises are developed closer to Coal Harbour, Yaletown and Downtown, and thus provide more space compared to the new construction units with some of them being in the 300 sqft’s.

Several locally owned eateries call the West End home, including several Sushi places, Greek places and Gelato shops. The area is quite ecclectic as well and funky boutiques are seen one after another. My recommendations for eats? Try Stepho’s Greek Taverna on Davie Street (expect a lineup, my trick is to order take-out to avoid them), Tanpopo’s on Denman for all you can eat sushi, or Samurai’s on Davie, a little hole-in-the-wall type place with AMAZING food!

For more information on West End real estate and Vancouver real estate, contact me directly at 778.855.0841 or email me at amy@vancouverpowersearch.com!

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