Tag Archives: Pospischil Realty Group

It’s A Great Time To Buy A Detached Home Now

Every market holds opportunity, the key is to know where to look for it…
Today’s greatest market opportunity resides in purchasing detached homes.

The detached market has been the most impacted both value, and activity wise across the board. The causes of this have been discussed already at great length; but in short they stem from the B20 stress test mortgage rule changes, a lack of consumer confidence, and other government intervention into the real estate marketplace. This has resulted in an excellent time for two real estate moves, first to upgrade from condo, or other strata property (which are still very active), or second to purchase detached as an investment property. The rental market remains strong, and we have had some clients secure amazing deals on detached homes, and rent part of the home or all of the home and get excellent monthly cost coverage, and some are cash flow positive.

We have also helped a number of clients recently upgrade from strata property to detached houses, as the price gap is smaller than it has been in years. (See the graph below- looking at Vancouver East for Example) So the marginal mortgage increase in property price is not a large as it once was (especially when you consider basement rental etc.), in fact it is smaller than it has been in years. When the market confidence returns, as it always does, this gap will grow/spread again, and this opportunity will pass.

We would be happy to meet with you and discuss how you could take advantage of this market opportunity to upgrade from your strata property to a detached house, or to purchase an investment detached house.

Current Median Prices as of March 31, 2019

VS. Median Price as of January 31, 2016Source: REBGV

City of Vancouver Empty Homes Tax Is Now A Reality

As you have probably heard, The City of Vancouver this past year implemented a tax on vacant properties. The tax is 1% of the properties assessed value. There are several exceptions and provisions within the new regulations, but generally speaking if a residential property is your principal residence where you live or has been rented for the past 6 months it will not be subject to this tax. We are coming up to our first declaration for this tax, and that being said all home owners must make a declaration by February 2nd, 2018 or it will likely be deemed to be vacant, and subject to the tax. This goes for those looking so sell/move as well, it is best to complete the declaration to avoid a potential problem or dispute.

City of Vancouver Empty Homes Tax is Now A Reality

 

The challenge we, and our Lawyer/Notary colleagues see for clients is that this tax (like property tax) runs with the property and the current registered owner (unlike income tax or sales tax specific to an individual or transaction). The problem is the City can potentially review up to two years following a taxation year, and collect the tax from the current owner if it is deemed payable. This is of specific concern for new owners property being finically responsible for a declaration a previous owner has made… a somewhat scary thought.

This all being said, there are ways we can work to reduce this exposure with research on your new prospective home, proper contract clauses, seller signed declarations, and a new title insurance product offering coverage for this exposure. The last of these may be the best way to reduce risk as of this time. We are eager to see how the City will resolve the difficult to overcome aspects within the implementation and execution of this tax.