December 28, 2011
Purchasing Property as a Non-Resident
There are no restrictions for non-residents when it comes to purchasing property in British Columbia although there are restrictions on the amount of time spent as a non-resident owning property in British Columbia.
Non-residents can stay in Canada for up to 182 consecutive or cumulative days (or six months). As a result, many non-residents will stay 6 months of the year in Canada and 6 months in their home residence. Non-residents that stay for more than 182 days may be deemed by the Canada Revenue Agency as a Canadian resident instead of a visitor and as a result, the visitor will be required to pay tax in Canada on ALL worldwide income including the income earned in their home country.
Getting a Mortgage as a Non-Resident
Non-residents can get a mortgage in Canada with a minimum of 35% down payment and verification of passport. There is usually not a problem securing mortgages with larger more established financial institutions. These institutions will usually require a letter of introduction from a previous banking facility to which the non-resident has down business in their home country.
Selling Property as a Non-Resident
When a non-resident owner sells Canadian Property they are required to holdback 25% of the proceeds of the sale pending filing of a Canadian Income Tax return by the end of the next year. The owner could also obtain a “Clearance Certificate” which may reduce the holdback to a percentage of the capital gain and this is often applied in advance of the sale.
A Clearance Certificate is a document that must be filed by a non-resident that outlines to CCRA that there are no outstanding tax issues with the property. The time frame of a Clearance Certificate can be 6-8 weeks. If the clearance certificate cannot be obtained before the completion of the property, the holdback funds by the lawyer or notary can be between 33% and 50%.
December 21, 2011
8 Simple Steps to Increase Value of your Home
The actual cost and payback for each project can vary, depending on both your home’s condition and overall real estate market values in your region of the country.
1. Make your kitchen really cook. The kitchen is still considered the heart of the home. Potential homebuyers make a beeline for this room when they first view a home for sale, so make sure your kitchen looks clean and reasonably updated. For a few hundred dollars, you can replace the kitchen faucet set, add new cabinet door handles and update old lighting fixtures with brighter, more energy-efficient ones.
If you’ve got a slightly larger budget, you can give the cabinets themselves a makeover. Rather than spring for a completely new cabinet system, which can be expensive, look into hiring a refacing company? Many companies can remove cabinet doors and drawers, refinish the cabinet boxes, and then add brand new doors and drawers. With a fresh coat of paint over the whole set, your cabinets will look like new.
2. Give appliances a facelift. If your kitchen appliances don’t match, order new doors or face panels for them. Many dishwasher panels are white on one side and black on the other. All you may need to do is unscrew two screws, slide out the panel and flip it around.
A more cohesive looking kitchen makes a big difference in the buyer’s mind — and in the home’s resale price.
3. Buff up the bath. Next to the kitchen, bathrooms are often the most important rooms to update. They too, can be improved with very little cash. Even simple things like a new toilet seat and a pedestal sink are pretty easy for homeowners to install and they make a big difference in the look of the bath.
Replacing an old, discolored bathroom floor with easy-to-apply vinyl tiles or a small piece of sheet vinyl is also recommended. You may not even need to take up the old floor.
If your tub and shower are looking dingy, consider re-grouting the tile and replacing any chipped tiles. A more complete cover-up is a prefabricated tub and shower surround. These one-piece units may require professional installation but can still be cheaper than paying to re-tile walls and refinish a worn tub.
4. Step up your storage. Old houses, particularly, are notorious for their lack of closet space. If you have cramped storage areas, a good idea is to add wire and laminate closet systems to bedrooms, pantries and entry closets.
You can also get design details and parts for these systems at many large home improvement stores. Most closets can be updated in a weekend or less.
In the end, your closets will be more functional while you’re living in the house and will make your home look more customized to potential buyers when you’re ready to sell.
5. Look underfoot. Carpeting is another detail that can quickly update a home and make it look cleaner. A professional carpet cleaning is an inexpensive investment, especially if your rugs are in good shape and are neutral colors.
If your carpet is showing serious wear, cover it with inexpensive, strategically placed area rugs. Unless it is truly hideous, most Realtors don’t suggest replacing wall-to-wall carpeting right before you sell your house. The new homeowners may want to choose their own carpeting after they move in.
6. Let there be light. If you have boring recessed lights in your dining and living rooms consider replacing one of the room’s lights with an eye-catching chandelier. Home stores offer a wide range of inexpensive, but nice-looking, ceiling fixtures these days. If you have a ceiling fan and light, you can buy replacement fan blades (leaving the fan body in place) to update the fixture’s look.
7. Reframe your entry. Do you have a flimsy little knob on your main entry door? If so, spring for a substantial-looking handle-and-lock set. A nice, big piece of hardware on the front door signals to newcomers that this is a solid home.
Also, if you’re stuck with a basic steel front door, consider painting or faux-finishing it for more eye appeal. Remember to use a good metal primer approved for use over metal. For a cherry wood look use a burgundy base paint. After it dries, brush over the base-coat with a cherry wood stain. It can look amazing, and it only takes a few hours.
8. Consider curb appeal. Although it sounds obvious, a nicely mowed lawn, a few well-placed shrubs and a swept walkway makes a great first impression. What buyers see when they first drive by your home is tremendously important.
If you don’t have a green thumb, consider hiring a landscaper to install some new sod, plant a few evergreen shrubs and give your front yard a good cleanup. These kinds of changes can instantly change people’s perception of your home and therefore, increase its value. And hey, your neighbours will love you for it, too.
December 21, 2011
Collection 45 Condos is a new condo project by MYIE Homes currently in preconstruction at 125 E 8 Ave in Vancouver. Condos start at $309,900
DEVELOPMENT NAME: Collection 45 Condos
DEVELOPER(S): MYIE Homes PROJECT
ADDRESS: 125 E 8 Ave
STATE/PROVINCE: British Columbia
POSTAL CODE: V5T 1R7
PROJECT WEBSITE: www.collection45.com
SALES CENTRE PHONE #: 604 569 1555
SALES CENTRE ADDRESS 124 E. Broadway, Vancouver
Collection 45 is a beautiful development inspired by European modernism and retraint. Each of the building's 45 residential suites is cleverly configured to embrace natural light, maximize open space and encourage free movement. The unique exterior design and location has intrigued many potential purchasers.
There are two color schemes to choose from - light or dark-both designed to complement the contemporary interior design.
The bathrooms include modern fixtures and marble finishes and the kitchen is stunning with its modern appliances and wall-mounted lacquer cabinetry.
The developer is currently offering a very attractive incentive. The first 10 purchasers receive up to 20k in services at Versante Spa at Collection 45!. If you would like to learn more about this development, click here.
December 21, 2011
The City of Vancouver is divided into many zoning districts. Each zoning district has a corresponding district schedule in the Zoning and Development By-law.
The following is a brief description of the intent of the district schedules. The Zoning and Development By-law and applicable official development plan by-laws must be consulted for a definitive statement of district schedule intent and regulations. Where a zoning district applies to one specific area of the city, the area is noted in parenthesis.
RA (Limited Agriculture District)
Limited Agriculture District (Southlands)
The intent is to maintain and encourage the semi-rural, equestrian and limited agricultural nature of this District, to permit one-family dwellings and in specific circumstances to permit infill one-family dwellings.
RS (One-Family District)
One-Family Dwelling Districts
The intent of this Schedule is generally to maintain the single-family residential character of the RS-1 District, but also to permit conditionally one-family dwellings with secondary suites. Emphasis is placed on encouraging neighbourly development by preserving outdoor space and views. Neighbourhood amenity is enhanced through the maintenance of healthy trees and planting which reflects the established streetscape.
One-Family Dwelling District
The intent is to maintain the single-family residential character of the District, but also to conditionally permit in some instances one secondary suite or additional dwelling unit in a single-family residence.
One-Family Dwelling District (Riverside)
The intent is to maintain the single-family residential character of the District, but also to permit a second one-family dwelling on some sites.
One-Family Dwelling District
The intent is primarily to maintain the single-family residential character of the District, but also to conditionally permit in some instances the conversion of large homes to contain additional accommodation, and some two-family and multiple-family dwellings.
RS-3 and RS-3A
One-Family Dwelling Districts
The intent is to preserve and maintain the single-family residential character of the RS-3 and RS-3A Districts in a manner compatible with the existing amenity and design of development, and to encourage new development that is similar in character to existing development in this District. Emphasis is placed on encouraging neighbourly development by preserving outdoor space and views and by ensuring that the bulk and size of new development is similar to existing development. Neighbourhood amenity is enhanced through the maintenance of healthy trees and planting which reflects the established streetscape. The RS-3 District permits a higher non-discretionary density than the RS-3A District.
One-Family Dwelling District (Turner-Ferndale)
The intent is primarily to maintain the single-family residential character of the District, to conditionally permit, in some instances, the conversion of large homes to contain additional accommodation, and some two-family dwellings and to accommodate retention of an existing residential building where creation of a new lot is otherwise approvable.
One-Family Dwelling District
The intent of this Schedule is generally to maintain the existing single-family residential character of the RS-5 District by encouraging new development that is compatible with the form and design of existing development, and by encouraging the retention and renovation of existing development but also to permit conditionally one-family dwellings with secondary suites. Emphasis is placed on design compatibility with the established streetscape. Neighbourhood amenity is intended to be enhanced through the maintenance and addition of healthy trees and plants.
One-Family Dwelling District
The intent is to maintain the single-family residential character, to encourage a good standard of building design, materials, and landscape evelopment while allowing design diversity in new development and to encourage retention of existing housing stock. Neighbourhood amenity is enhanced through the maintenance of healthy trees and planting which reflects the established landscape.
One-Family Dwelling District
The intent of this Schedule is to maintain the single-family residential character of the RS-7 District and, on typical smaller lots, to conditionally permit two-family dwellings and multiple conversion dwellings and, on larger lots, to conditionally permit multiple-family dwellings and infill. Neighbourhood amenity is enhanced through external design regulations.
RT (Two-Family Dwelling District)
Two-Family Dwelling District
The intent is primarily to permit side-by-side two-family dwellings.
Two-Family Dwelling District
The intent is to permit two-family dwellings and to conditionally permit, in some instances, low density multiple-family housing.
Two-Family Dwelling District (Strathcona/Kiwassa)
The intent is to encourage the retention of neighbourhood and streetscape character, particularly through the retention, renovation and restoration of existing character buildings. Redevelopment is encouraged on sites with existing buildings of style and form which are inconsistent with the area’s pre-1920 architecture. Emphasis is placed on the external design of additions to existing buildings and new buildings to encourage the preservation of the historic architectural character of the area. Floor area incentives are included to achieve the creation of affordable housing and the rehabilitation of original buildings which are important to the neighbourhood’s character.
RT-4, RT-4A, RT-4N, RT-4AN, RT5, RT-5A, RT-5N and RT-5AN
Two-Family Dwelling Districts
The intent is to encourage the retention of exisiting residential structures and to encourage and maintain a family emphasis in the RT-4, RT-4N, RT-5 and RT-5N Districts emphasis is placed on the external design of all new buildings and additions being compatible with the historical character of the area, and on being neighbourly in scale and placement. In the RT-4A, RT-4AN, RT-5 and RT-5AN District this emphasis is limited to certain uses or, in RT-5A and RT-5AN Districts, to development seeking density relaxations. The RT-4N, RT-4AN, RT-5N and RT-5AN Districts require evidence of noise mitigation for residential development.
Two-Family Dwelling District (Mount Pleasant)
The intent is to encourage the retention, renovation and restoration of existing residential buildings which maintain an architectural style and building form consistent with the area. Redevelopment is encouraged on sites with smaller buildings or buildings of architectural style and form which are inconsistent with the area. Emphasis is placed on requiring the external design of buildings and additions to buildings to follow the proportions, rhythm and details of architectural features of the area.
RT-7 and RT-8
Two-Family Dwelling Districts
The intent is to encourage the retention and renovation of existing buildings which maintain an architectural style and building form consistent with the historical character of the area. Redevelopment will be encouraged on sites where existing buildings are smaller, or do not contribute to this character. For renovations and additions, emphasis is placed on maintaining existing external architectural character; for new development, on compatibility in external character. In all cases, neighbourly building scale and placement is emphasized.
Two-Family Dwelling District (Kitsilano Point)
The intent is to encourage new development with a diversity of character and neighbourly building scale and placement. The retention and renovation of existing buildings is also permitted on sites where buildings have historical or architectural merit.
RT-10 and RT-10N
Two Family Dwelling Districts
The intent of this Schedule is to encourage development of multiple small houses and duplexes on large lots and assembled sites, while continuing to permit lower intensity development on smaller sites. Siting and massing is intended to be compatible with, but not the same as, pre-existing single family development. Retention of older character buildings and high quality architectural design of all new development are encouraged.
RM (Multiple Dwelling District)
RM-1 and RM-1N
Multiple Dwelling Districts
The intent of this Schedule is to encourage development of courtyard rowhouses on larger sites while continuing to permit lower intensity development on smaller sites. Siting and massing is intended to be compatible with, but not the same as, pre-existing single family development. High quality architectural design of all new development is encouraged.
Multiple Dwelling District
The intent is to permit low to medium density residential development, including low-rise apartment buildings, and to secure a higher quality of parking, open space and daylight access through floor area bonus incentives.
RM-3 and RM-3A
Multiple Dwelling Districts
The intent is to permit medium density residential development, including high-rise apartment buildings, and to secure a higher quality of parking, open space and daylight access through floor area bonus incentives.
RM-4 and RM-4N
Multiple Dwelling Districts
The intent is to permit medium density residential development, including a variety of multiple dwelling types, to encourage the retention of existing buildings and good design, and to achieve a number of community and social objectives through permitted increases in floor area. The RM-4N District requires evidence of noise mitigation for residential development.
RM-5, RM-5A, RM-5B and RM-5C
Multiple Dwelling Districts (West End)
The intent is to permit a variety of residential developments and some compatible retail, office, service and institutional uses. Emphasis is placed on achieving development which is compatible with neighbouring development with respect to streetscape character, open spaces, view retention, sunlight access and privacy. The RM-5A, RM-5B and RM-5C Districts permit greater densities than RM-5.
The additional intent of the RM-5 District is to require developments suited to families with children. The additional intent of the RM-5C District is to permit a greater range of uses.
Multiple Dwelling District (West End)
The intent is to permit high density residential development and some compatible retail, cultural, recreational, service and institutional uses. Emphasis is placed on achieving development which recognizes the formal character of Georgia Street and is compatible with the West End residential character along Alberni Street.
Multiple Dwelling District (Fairview Slopes)
The intent is to enhance the small-scale residential character of the Fairview Slopes neighbourhood by encouraging retention of the existing houses and permitting new low-profile residential development which may include some compatible commercial, light industrial, and ancillary uses, designed to optimize the amenities inherent in the topography and location of this neighbourhood.
C (Commercial District)
The intent is to provide for small-scale convenience commercial establishments, catering typically to the needs of a local neighbourhood and consisting primarily of retail sales and certain limited service functions, and to provide for dwelling uses designed compatibly with commercial uses.
The intent is to provide for a wide range of goods and services, to maintain commercial activities and personal services that require central locations to serve large neighbourhoods, and to provide for dwelling uses designed compatibly with commercial uses.
The intent is to provide for a wide range of goods and services, to maintain commercial activities and personal services that require central locations to serve larger neighbourhoods, districts or communities and through discretionary approvals to encourage good design and proper utilization of the land.
The intent is to provide for a wide range of goods and services, to maintain commercial activities and personal services that require central locations to serve larger neighbourhoods, districts or communities and to encourage creation of a pedestrian oriented district shopping area by increasing the residential component and limiting the amount of office use.
The intent is to provide for a wide range of goods and services, to maintain commercial activities and personal services that require central locations to serve larger neighbourhoods, districts or communities and to encourage creation of a district shopping area by increasing the residential component and limiting the amount of office use.
The intent is to provide for a wide range of goods and services, to maintain commercial activities, specialized services and some light manufacturing enterprises while preserving the character and general amenity of the area and its immediate surroundings, and to provide for dwelling uses designed compatibly with commercial uses.
C-5 and C-6
Commercial Districts (West End)
The intent is to provide for retail and services uses and forms of development which are compatible with the primarily residential character of the West End, and to provide for dwelling units designed compatibly with commercial uses. Emphasis is placed on requiring the external design of buildings to be oriented to the pedestrian in terms of scale and functional considerations. The C-6 District provides a transition between Downtown and the West End by permitting a greater density and scale and range of uses than C-5.
C-7 and C-8
Commercial Districts (Arbutus Neighbourhood)
The intent is to encourage the transition of a predominantly industrial and commercial area into a mixed-use community with a strong residential component, while respecting the needs of existing development. Emphasis is placed on well-designed all-residential or mixed residential and commercial buildings. The C-8 District differs from the C-7 District in encouraging pedestrian-oriented retail uses at grade.
Commercial District (East False Creek)
The intent is to permit and encourage the development of a high density mixed commercial use neighbourhood, including some residential and compatible industrial uses. For commercial development, a variety of small-scale retail and service uses are encouraged. Larger, more regional-oriented office and retail commercial uses are limited in size and extent for individual sites.
M&I (Industrial District)
MC-1 and MC-2
The intent of this Schedule is to reinforce the mixed-use nature of this area, with residential, commercial and light industrial uses permitted. Emphasis is placed on building design that furthers compatibility among uses, and contributes to area character and pedestrian interest. The MC-2 District differs from the MC-1 District in limiting dwelling uses in areas adjacent to a heavy impact industrial zone.
The intent is to permit industrial and other uses that are generally incompatible with residential land use but are beneficial in that they provide industrial employment opportunities or serve a useful or necessary function in the city. It is not the intent, however, to permit uses that are potentially dangerous or environmentally incompatible when situated near residential districts.
Industrial District (Cornwall & Cypress)
The intent is to permit industrial and other uses that are generally incompatible with residential land use but are beneficial in that they provide industrial employment opportunities or serve a useful or necessary function in the city. It is the intent, however, to permit these uses in a manner which achieves an acceptable level of compatibility with adjacent residential districts and to not permit uses that are potentially dangerous or environmentally incompatible when situated near residential districts.
Industrial District (S.E. Marine Lands)
The intent is to provide an industrial district schedule that permits industrial and other related uses under conditions designed to minimize conflicts with adjacent or nearby residential uses. The Schedule is also intended to discourage uses that are not related to the industrial sector. While certain commercial and office uses are permitted as either outright or conditional uses, the type and scale of non-industrial uses is restricted.
The intent is to permit industrial and other uses that are generally incompatible or potentially dangerous or environmentally incompatible when situated in or near residential districts but that are beneficial in that they provide industrial employment opportunities or serve a useful or necessary function in the city
IC-1 and IC-2
The primary intent is to permit light industrial uses that are generally compatible with one another and with adjoining residential or commercial districts. It is also the intent to permit advanced technology industry, industry with a significant amount of research and development activity, and commercial uses compatible with and complementing light industrial uses.
The general intent of external design regulations in the IC-2 District is to achieve a form of development compatible with the function and character of abutting major streets.
The primary intent is to permit a mix of light industrial, live arts and theatre, residential and related uses that are generally compatible with adjoining residential and commercial districts. Service uses compatible with and complementing light industrial uses and a limited number of office uses are also permitted, but not general retail stores. The general intent of the external design regulations is to achieve certain public objectives with respect to the historic Brewery Creek water course.
The primary intent is to permit light industrial uses that are generally compatible with one another and with adjoining residential or commercial districts. It is also the intent to permit advanced technology industry, and industry with a significant amount of research and development activity. Service commercial uses compatible with and complementing light industrial uses are also permitted but not offices or retail stores.
The internt is to permit industrial and other uses that are generally incompatible with residential land use but are beneficial in that they provide industrial and service employment opportunities or serve a useful or necessary function in the city. It is not the internt, however, to permit uses that are potentially dangerous or environmentally incompatible when situated near residential districts.
The intent is to permit high technology industry, and industry with a significant amount of research and development activity. It is also the intent to permit light industrial uses that are generally compatible with one another and with adjoining residential or commercial districts.
HA (Historic Area Districts)
HA-1 and HA-1A
Historic Area Districts (Chinatown)
The intent is to encourage the preservation and rehabilitation of the significant early buildings of Chinatown, while recognizing that the evolving activities that make this district an asset to the City need to be accommodated contextually. The Schedule may permit a range of uses provided that reasonable, but not rigorous, concerns for compatibility are met.
To achieve this intent, this Schedule provides the basic development controls that regulate land uses and building form. There are two Districts: HA-1 corresponds to the boundaries of the Provincially designated sites; HA-1A is the remainder of Chinatown.
Historic Area District (Gastown)
Gastown is the site of the old Granville Townsite, and it is from this area that the City of Vancouver developed and grew. This District Schedule is designed to recognize the area’s special status and to ensure the maintenance of Gastown’s “turn of the century” historical and architectural character.
Historic Area District (Yaletown)
The intent is to encourage the conversion and renovation of existing warehouse buildings and the construction of compatible new buildings, to produce a more contemporary mix of commercial, industrial and residential uses, and to introduce more activity-oriented uses into this area. Emphasis is placed on requiring the external design of buildings to follow the proportions, rhythm and details of the predominant circa 1900 architectural features, whether renovating or constructing a new building.
CD (Comprehensive Development District)
Comprehensive Development District
A separate CD-1 bylaw exists for each area or site zoned CD-1, tailor-made to the intended form of development.
Comprehensive Development District (False Creek - South Side)
The intent of this District and accompanying official and area development plans is to encourage high standards of design and development for the south shore of False Creek, west of the Cambie Bridge
Comprehensive Development District (Downtown)
The intent of this District and accompanying official development plan is to ensure that all buildings and developments in the Downtown District meet the highest standards of design and amenity for the benefit of all users who live, work, shop or visit the Downtown.
Comprehensive Development District (Central Waterfront)
The intention of this District and its two accompanying official development plans (Central Waterfront and Coal Harbour) is to encourage the development of commercial, recreational, cultural and public uses throughout the waterfront area as well as residential uses west of BurrardStreet. Marathon’s Coal Harbour redevelopment is in this area, between Cardero and Burrard Streets.
Comprehensive Development District (Downtown-Eastside/Oppenheimer)
The intent of this District and accompanying official development plan is to retain existing and provide new affordable housing for the population of the Downtown-Eastside Oppenheimer area, and to provide for compatible commercial and industrial uses in some areas.
Comprehensive Development District (First Shaughnessy)
The intent of this District and accompanying official development plan is to protect and preserve Shaughnessy’s unique pre-1940 single-family residential character. Provision is made to allow large pre-1940 houses to be redeveloped as multiple conversion dwellings, and to allow large sites with pre-1940 residential buildings to provide infill development.
Comprehensive Development District (False Creek - North Side)
The intent of this District and its two accompanying official development plans (False Creek North and Southeast Granville Slopes) is to achieve a high standard of design and development within a number of residential neighbourhoods, parks, public facilities and commercial areas on the north side of False Creek.
December 19, 2011
Credit Score and History
When applying for a mortgage, your credit and work history are extremely important.
Some tips that help your credit and show that you are able to repay a mortgage include:
1. Open a bank account and use it regularly.
2. Pay your bills on time including rent, utilities, cable, credit card payments, and insurance premiums.
3. Apply for a credit card.
4. Try and remain with the same employer for an extended period of time.
5. Apply for small loans from your bank and pay them back on time.
You can obtain your credit score and report from Equifax for a small fee.
If you are thinking about purchasing a property for the first time and have further questions please contact a Vancouver REALTOR today. Our team of real estate professionals are ready to answer all of your questions.
December 19, 2011
Open Mortgage Versus Closed Mortgage
Open mortgages can be paid off at any time without penalty and are usually negotiated for very short terms. They are suited to homeowners who are planning to sell in the near future or those who want the flexibility to make large, lump-sum payments before maturity.
Closed mortgages are commitments for specific terms. If you want to pay off the mortgage balance, you will need to wait until the maturity date or pay a penalty.
December 19, 2011
Short Term Mortgage versus Long Term Mortgage
Short Term Mortgage
The term is the length of the current mortgage agreement. A mortgage typically has a term of 6 months to 10 years. Usually, the shorter the term the lower the interest rate. A short term mortgage is usually for two years or less.
Long Term Mortgage
A long-term mortgage is generally for three years or more. Short-term mortgages are appropriate for buyers who believe interest rates will drop at renewal time. Long-term mortgages are suitable when current rates are reasonable and borrowers want the security of budgeting for the future. The key to choosing between short and long terms is to feel comfortable with your mortgage payments. After a term expires, the balance of the principal owing on the mortgage can be repaid, or a new mortgage agreement can be established at the then-current interest rates.
For more information on the advantages and disadvantages of short term versus long term mortgages please contact us today!
December 19, 2011
Fixed Mortgage versus Variable Mortgage
When you take out, your interest rate will not change throughout the entire term of your mortgage. As a result, you’ll know exactly how much your payments will be and how much of your mortgage will be paid off at the end or your term.
With a variable-rate mortgage, your rate will be set in relation to Bank Prime at the beginning of each month. In other words, it may vary from month-to-month. Historically, variable-rate mortgages have tended to cost less than fixed-rate mortgages when interest rates are fairly stable.
When rates change, your payment amount remains the same. However, the amount that is applied toward interest and principal will change. If interest rates drop, more of your mortgage payment is applied to the principal balance owing. This can help you pay off your mortgage faster.
So which mortgage should you go with?
The answer is... it depends. If you are someone that can handle a little uncertainty then you may be better off going with a variable rate as variable rates statistically have been known to save your more money over the longer term. However if you like certainty in your monthly payments then going with a fixed rate would probably be more suitable for you. With a fixed rate your monthly payments are the same every month for the term of the mortgage.
If you are interested in learning more about the different types of mortgages please contact one of our reputable mortgage brokers!
December 19, 2011
The Basics of Mortgages
What is a mortgage?
A mortgage is a loan that uses the home you purchase as security. The loan is registered as as a legal document against the title of your property.
A mortgage has both principle and interest amounts.
The principle is the actual amount of the loan, or the cash that is actually borrowed.
The interest is the amount the lender charges to use the principle or the cash that is borrowed. Interest rates vary depending on the terms and conditions of the mortgage.
The amortization period is the actual amount of time it will take for you to repay back the entire mortgage in full and this can range from 15 to 30 years.
The term is the length of time for which a mortgage agreement exists between you and the lender. This can range from six months to seven years.
The maturity date marks the end of the term at which point you can either repay the balance of the principle or renegotiate the mortgage at the current mortgage rates at that time.
It is important for you to get a preapproval by a mortgage broker before looking for a home to purchase. To find a reputable mortgage broker please click here
December 19, 2011
Assessed Value versus Appraised Value
When purchasing a property, many buyers believe that they are getting a deal if they purchase the property below the assessed value. This brings up the important question, what is the difference between the assessed value and the appraised value of a property?
Assessed Value is the value placed on real estate for determining taxes.
Appraisal Value is the current worth of a property based on factors such as area, location, improvements and amenities. This value is generally found through a market comparison approach.
So now that we know the definitions of both the assessed and appraised values of a property we can take a look at an example:
A purchaser is considering putting in an offer on a one bedroom condo in the Yaletown area. The assessed value is $339,000 and the assessed value is $365,000. The $339,000 is what the government uses to determine the amount of tax that the owner has to pay at the end of tax year. The list price of $365,000 was determined through a comparative market analysis of current listings in the building and surrounding area as well as the recent sales that have taken place. Therefore, the same product in East Vancouver may the same assessed value but may be listed at $345,000 depending on the sales in that area.
For more information on this or other Vancouver Real Estate questions please contact the BetterLivingGroup team.
December 19, 2011
Types Of Mortgages
There are two types of mortgages: Conventional and High Ratio
In a conventional mortgage, the loan amount does not exceed 80% of the property value.
In a high ratio mortgage, the amount mortgaged is more than 80% of hte property value (with the max being 95%).
A high ratio mortgage must be insured against borrower default. The borrower pays a mortgage insurance premium which is added to the mortgage loan or paid in a lump sum in advance. The borrower must also pay the insurance application fee.
Mortgage Insurance Premium
Home buyers that purchase a property with less than 20 % down payment are qualified for a CMHC high ratio mortgage. If you are a first time home buyer, you are able to take up to $25,000 from your RRSP savings as your down payment under the "home buyer's plan". This RRSP loan is an interest free loan and you have 15 years to repay the loan back with the minimum of 1/15 payment each year.
When you are buying a home with less than 20% down payment, your mortgage is considered a high ratio mortgage. This means that you are required to buy home mortgage insurance to protect your mortgage lender against loan default. The insurance premium charged is dependent how much down payment is provided by you. The insurance premium may range from 1.00% to 2.75% of your mortgage amount.
Please refer to the CMHC mortgage insurance premium table for details. If you plan on buying a home with only 5% down payment, make sure you talk to your mortgage broker on the different sources in which the 5% can come from. For example: the 5% down payment can come from lender's cash back incentives, lines of credit, arm's length personal loans or a gifted down payment.
December 19, 2011
Purchasing a Presale
It is very important to bring a REALTOR that understands the process of presales with you to the sales center. A REALTOR will read thoroughly through the contract to ensure that everything is in place and that even the smallest detail is not overlooked. Often presales are non-negotiable in terms of price however negotiable on other terms such as upgrades, deposit structures, and parking spots.
The advantages of purchasing a presale:
• Once you put down your deposit you won’t have to worry about mortgage payments for a few years.
• You have full home warranty when you move into your new home.
• If the market goes up from the time of purchase to the time of completion, buyers may opt to sell their property as an assignment.
The disadvantages of purchasing a presale:
• When you purchase a presale, you are purchasing your home based on a floor plan. The developer usually has a clause where the floor plan can be adjusted slightly so you may have a slightly different floor plan or square footage upon completion of the property.
• GST/HST is to be paid on all presale units upon completion of the property.
• There is always a risk (although usually quite small) that the property will not complete. In that case, the deposits are given back to the purchasers
• If the market goes down from the time of purchase to the time of completion, buyers may opt to not complete by forfeiting their deposit.
Below are the standards steps you would go through when purchasing a presale:
1) Choosing your home
This is the most exciting part of the whole process. When you walk into a sales center, representatives will be waiting to assist you. The representatives will provide you with detailed information about the development, the developer, the floor plans, amenities, and pricing of the units. The process of deciding which development and unit to purchase may take several weeks and visits.
Once you have decided on a development and a unit or units to purchase, your REALTOR will go through the contract with you thoroughly. The deposit structure will be identified in the contract along with the color scheme, parking, and other important details.
2) Color Selection
Once you have selected your unit, you will have the opportunity to choose a color scheme for the cabinets, appliances, flooring, faucets, etc.
3) During Construction
Builders often understand how difficult it is for home buyers to sit back and wait for their homes to be built. Most builders inform their home buyers the progress of the development via email or phone. Some builders even allow a series of site visits during various stages of construction.
4) The Walk-Through
A few weeks prior to moving into your new home, the home buyer will have an opportunity to do a walkthrough of their unit. This is where the home buyer will look through the unit from top to bottom to identify any deficiencies that need to be fixed prior to moving in.
5) After Sales Service
The service does not end when you move into your new home. The developer will often remind you of the milestones in your warranty coverage. The most common warranty is 2-5-10 warranty. 2 years is for the interior of the unit. 5 years is for the rainscreen of the building and 10 years is for the structural part of the building.
December 19, 2011
Real Estate Definitions
Adjustment Date: The day you become responsible for the fees or cost associated with the property. Your lawyer will prepare a statement of adjustments pro-rating any pre-paid taxes, monthly maintenance fees if applicable and any other costs that may have been paid in advance or owing.
Amortization: The period of time required to reduce a debt to zero when payments are made regularly.
Appraisal: For mortgage lending purposes it is a process whereby the (lending) value of the property is determined. The lending value may or may not match the purchase price of the home. An appraisal done for mortgage lending purposes is carried out for the benefit of the lender or the mortgage insurer (CMHC).
For consumers an appraisal is performed by a trained professional to determine what a house is worth.
Completion Date: The day the seller received your funds in exchange for you receiving title to the property. The title is registered under your name at the Provincial Land Titles Office on that day. The date must fall on a normal business day, Monday to Friday.
Conventional Mortgage Loan: A mortgage loan up to a maximum of 75% of the lending value of the property for which a lender does not require mortgage loan insurance.
Counter Offer: When one party to an Offer to Purchase (buyer or seller) does not accept some or all of the terms and conditions offered by the other party and in turn “counter” offers alternate terms and conditions. During the course of negotiation through offering and counter offering the buyer and seller work towards achieving terms and conditions acceptable to both parties.
Deposit: The amount of money a buyer initially puts down at the time a Contract of Purchase and Sale is entered into to show sincerity of intent and to provide for potential liquidated damages in favour of the seller if the buyer does not perform according to the terms agreed to in the Contract. The funds are usually placed in the buyer’s realtors trust account and forms part of the purchase monies. A deposit in the amount of 5% of the purchase price is common real estate practice in Greater Vancouver.
Down Payment: The actual money a buyer has to put toward the purchase of a property from their own resources.
Easement: The right acquired for access to or over, and perhaps use of, another person’s land for a specific purpose such as a driveway or public utilities.
Encumbrance: A registered claim for debt against a property, such as a mortgage.
Equity (owner): The difference between the price for which a home could be sold and the total debts registered against the home. Owner equity usually increases as the outstanding principal of the mortgage is reduced through regular payments. Market values and improvements to the property also affect equity.
Gross Debt Service (GDS): The percentage of the borrower’s gross income that will be used for monthly payments of principal, interest and taxes, heating costs and half of condominium fees.
High-Ratio Mortgage: A first mortgage loan, often for more than 75% of the value of the property, where the lender has the mortgage insured by either CMHC or a private mortgage insurance company. Mortgage loans of more than 75% of the value are also called high-ratio loans.
Mortgage: The balance of the purchase price (purchase price – down payment = mortgage amount) borrowed from a lender which is secured by the lender by a charge against the property title and your personal guarantee to repay the loan.
Mortgagee: The lender who provides the mortgage loan.
Offer to Purchase: A written contract setting out the terms under which the buyer agrees to buy. Upon acceptance by the seller, it forms a legally-binding contract subject to the terms and conditions stated in the document.
Possession Date: Usually the same date as the adjustment date. The day you are entitled to the legal possession of the property you have purchased (you get the keys!). In BC, possession usually occurs a day or two after completion.
Subject Clause: A condition(s) that must be satisfied before a contract becomes firm (unconditional). Examples are subject to financing, inspection or receipt and approval of condominium bylaws and financial statements. The conditions must be removed from the contract in writing by a certain date in order for the contract to become “firm”.
Principal: The amount of money actually borrowed.
Term: The length of time during which you pay a specific interest rate on your mortgage loan. You may not have paid off your entire mortgage principal at the end of a term because your amortization period will likely be longer than the term.
Title (Freehold or Leasehold): A freehold title is evidence of ownership of land and buildings for an indefinite period of time.
A lease hold title is evidence of a right to use and occupy land and buildings for a defined period of time. In a leasehold arrangement actual ownership of the land (and perhaps buildings) remains with the landlord.
Total Debt Service Ratio (TDS): The percentage of gross annual income required to cover all payments for housing and all other debts such as car payments
December 16, 2011
What to Expect: Completion Costs
GST - If you buy a newly constructed home, you must pay the 6% GST. However, if your house is less than $450,000 you may be eligible for a rebate. For more information, please visit www.cra-arc.gc.ca/tax/business/topics/gst/construction/menu-e.html
Property Transfer Tax - When a residence is purchased a Property Transfer Tax (PTT) is applied. The tax is calculated at 1% on the first $200,000 and 2% on the remainder. The First-Time Home Buyers' Program offers an exemption to PTT if the fair market value of the residence is $325,000 or less, in the Greater Vancouver, Fraser Valley and Capital Regional Districts. The threshold for the rest of BC is $265,000. In all regions there is also a proportional exemption for first-time buyers of homes with a fair market value up to $25,000 above the thresholds. This means in the Greater Vancouver area, homes valued up to $350,000 ($325,000 threshold + $25,000 proportional exemption) will be charged a pro-rated PTT. For more information please visit: www.rev.gov.bc.ca/rpt/ptt/ptt.htm
Prepaid property taxes or utility bills - You will have to reimburse the sellers for any prepaid property taxes or utilities.
Mortgage loan insurance and application fee - If you get a high-ratio mortgage (a mortgage where you pay less than a 25% down payment) you will have to buy mortgage loan insurance from CMHC or a private company. If you qualify for a 5% down payment, CMHC charges an insurance fee that equals 3.25% of the mortgage. If you put 10% or 15% down, your insurance fees will decrease to 2% and 1.75% respectively. The insurance premium usually gets added to your mortgage.
Appraisal - Before your lender approves your mortgage, you may be required to have an appraisal done. Sometimes your lender covers this cost otherwise you are responsible for covering this cost. The fee ranges from $150 to $350.
Survey fee - Your lender may require an up-to-date survey of the property. If the seller did not provide you with one, you will have to pay to have one done. The fee ranges from $150 to $350.
Home Inspection fee - Most REALTORS® recommend that you get a home inspection by a certified home inspector. It will cost you from $150 to $350 for a smaller house. Large houses may cost more.
Legal fees - Lawyers/Notaries fees for closing the sale range according to the complexity of the deal but they will probably be at least $400.
Disbursements to Land Titles Office - These fees are approximately $300. Your lawyer/notary will arrange this payment.
December 16, 2011
What do you "need" and "want" in a house?
Everyone has different needs and wants in life and these are often translated into the type of home you want to live in. The best advice is to be clear on what your requirements and desires before you start looking. This way, you will be able to focus on finding a house that is ideal and that is within your budget.
First off, you need to choose which neighborhood you want to live in. Your decision may be dependent on how close your home is to grocery stores, schools, public transit, etc.
Once you have chosen your neighborhood, as yourself the following questions:
•How many are there in your family? Are you planning on having children? Are your children moving out of the home soon?
•What type of house do you want to buy: a single-detached home, a townhome, a condo?
•How many bedrooms do you need or will need in the feature?
•How many bathrooms?
•Do you need a separate dining room area to entertain guests or are you ok with sitting on bar stools at the kitchen counter for dinner?
•Do you require space for a home office?
•Do you need a quiet room for your children to do their homework?
•Do you need extra storage space? a guest room?
•Do you enjoy reading or relaxing by a fireplace?
Remember that most people move at least 3 to 4 times in their life so take some time to evaluate how long you plan on staying at your new home. Once you have identified your neighborhood, your needs and wants, you are ready to hire a real estate agent.
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