Here’s Some Good News For Those Worried About Losing Their Homeowner Grants After Receiving Their 2017 Property Assessment Notifications

On January 1, 2017 many homeowners in BC woke up to find that they were richer as their property value had skyrocketed, in some cases, by at least 40%.

The increased property values have a 2-fold impact:

1) Many of the homeowners who enjoyed the benefit of the $570 Homeowner grant to help them with the property taxes, have discovered that the increased value of their property has pushed them out of the qualifying threshold, leaving them without the grant.

2) With the increased property values comes a hike in property taxes, which can have dire financial impact on low-income households, such as seniors, veterans and individuals on fixed income. Some of these individuals bought their homes 20-30 years ago for around $50,000 only to see them worth millions of dollars today.

In view of this, and this being an election year, the Finance Minister gave an assurance at the beginning of this year that the Homeowners Grant threshold would be increased, to account for the increase in property values and bring some relief to homeowners. But the question remained how much?

On the 10th of January, the Provincial government increased the threshold from $1.2 million to $1.6 million of assessed value.

Here are some interesting stats released by the Minister of Finance:

-         If the new threshold had not been introduced last week, then only 68% of Metro Vancouver homes would have been covered.

With the new threshold 83% are now eligible.

-         Under the old threshold, only 49% of Vancouver homes would have been covered.

With the new threshold, 67% are now eligible.

-         Under the old threshold, 59% of Burnaby homes would have been covered

With the new threshold, 78% are now eligible.

-         Province wide, the old threshold would have covered 84% of home owners

With the new threshold, 91% are eligible.

Going back to the problem of the low-income households facing higher taxes as their home value falls outside the new threshold limit, the government has a number of remedies, with 2 programs being at the forefront:

1)     The property tax deferral program – available to those over 55, a surviving spouse, a person with disabilities or a family with children.

2)     Low income supplement – available to seniors aged 65 or over who meet certain requirements.

The Provincial government has ensured that 91% of homeowners across BC will be eligible to receive a basic grant and the program will apply to 83% of the homes in Metro Vancouver.

If you own a home in Metro Vancouver and require some assistance or advice regarding your property taxes, we have a team of experts who can help you. Contact us on 604 695 1000, email us or visit our offices on 1280 West Pender St.

FILED UNDER Buying & Selling, Vancouver, Virani Tips    Leave a comment

Breaking News: A Major Change to the 15% Foreign Buyers Tax

Last year in July, the Government of BC introduced a 15% tax on foreign buyers as a way of cooling down the red hot Vancouver real estate market. According to BC’s Premier Christy Clark, the tax has worked as it has slowed down the “incredible distortion in the market” and had the required impact it was set out to do.

With this in mind, the government has decided that now is the time to make changes to the tax. So the Premier chose to make an announcement, which, some may argue, is influenced by the current immigration chaos that is running rampant in the US.

At the Chines New Year parade last Sunday, the Premier said that the BC Government is lifting the 15 per cent foreign buyers tax for anyone living in Metro Vancouver with a work permit, who pays taxes and contributes to the economy, and wants to purchase a home.

The move is to encourage skilled immigrants to move to BC, especially those who have been affected by US President Trump’s executive order, banning travel and immigration into the US for people from 7 Middle Eastern and North African countries. Those who had previously considered moving to BC, but were discouraged by the 15% tax, will no longer face this obstacle.

The Premier made a direct reference to Google, Microsoft and Facebook encouraging them to consider sending more employees to Vancouver and beef up their local presence, especially if they are worried about the legal status of their employees’ residence in the US. They will not be subject to the tax.

Canada has had a history of allowing victims of persecution a safe haven within its boundaries, and the government of this province is no exception to this. It seeks to attract the best and brightest to our shores, no matter where they come from, as long as they pay taxes and make a positive contribution to our economy.

There are lots of opportunities available in the Vancouver housing market. If you contact us on 604 913 1000 or email us, our experienced and professional real estate advisors will be able to assist you in any way shape or form.

FILED UNDER Buying & Selling, Vancouver    Leave a comment

Why Vancouver House Prices Will Continue to Rise in the Coming Years

Recently, our beautiful city was shown as having the third least affordable housing market in the world in a survey by Demographia. We are all aware of the fact that Vancouver housing has become a major political and economic issue over the last few years, as home prices have shown dramatic double-digit increases.

Although the housing market has taken a hit in the last few months due to recent political actions such as the 15% foreign buyers tax, in the long term, house prices will continue to rise, making home ownership in the city an attractive proposition.

Consider the following factors when evaluating house prices in Vancouver:

* Vancouver has the most restrictive land use policies of any city in Canada. Supply side issues caused by municipal regulations dating back decades, have been one of the main causes of the current housing crises. This issue is now being addressed, but as we are all aware, policy changes take a long time to become reality.

* Investors from Mainland China and the rest of the world will continue to buy and invest in real estate in Canada. Canada is a highly respected, safe, stable and democratic country, with a generous immigration policy: this is more apparent now with the new administration in the US.

* The planned changes to the foreign homebuyers tax to exempt those in Metro Vancouver who have work permits will encourage more people to come and move to Vancouver, creating more demand for housing.

* Canadian currency is weak and is projected to remain so when compared with the US dollar, making our home prices very attractive to investors.

* We have a shortage of land: mountains to the north, a border to the south, an ocean to the west, and to the east a 22% agricultural land reserve. So there is very limited space left to build that single-family house.

* The West Coast is attractive in terms of weather and geography than any other area in Canada. More than a million people are expected to move into the region by 2041, and this will put more pressure on the housing market.

* While the provincial government realizes that more homes have to be built and is gradually working to accommodate this, there will still be a time lag before this actually happens and the additional homes are built. Meanwhile, expect prices to increase as the shortage persists: simple supply and demand economics.

* As the city densifies to make room for the increased demand for housing, detached homes will become more limited and more expensive, as is the case in other major cities worldwide.

Buying a home in Vancouver is potentially a great investment. Take advantage of the current downturn and uncertainty by investing in one. We have a very experienced and knowledgeable group of real estate professionals available to help you. Please call us at 604.913.1000 with any questions you may have about the market or real estate in general, we’d be happy to assist you.

FILED UNDER Uncategorized    Leave a comment

What Does a Home Mean to You: Karim Virani

Meet Karim Virani, founder of Virani Real Estate Advisors based in Vancouver, BC. Karim’s warm, friendly demeanor is the first thing you will notice when you meet him. A Realtor since 1988, Karim’s passion for the real estate industry has garnered him many awards, consistently ranking top 1% of all Realtors in Greater Vancouver, and top 100 Realtors in Canada.

Karim and his team at Virani Real Estate Advisors are passionate about giving back and having an impact, leading them to become World Housing’s very first realtor brokerage partner in Canada. Every home sold by Virani Real Estate unlocks a donation to World Housing, with a goal to build a neighbourhood in the Steung Meanchey slum in Cambodia in 2017. If you would like to support Virani reach their goal, make a donation on their fundraising page here!

World Housing has been on our personal radar for years. Pete Dupuis and Sid Landolt are both inspirational people who have been a part of Vancouver and my life for years. Their hard work and generosity of spirit is a solid reminder that children—wherever they live—deserve a place to play, in a community surrounded by family. That’s just one reason why Virani Real Estate Advisors got involved with World Housing. It’s easy to take the basic necessities we enjoy for granted, and we wanted to make a difference. Through Westbank’s Vancouver House, we gifted 13 World Housing homes to 65 people in need. Since then we have committed to providing a community with a neighbourhood and a playground and hope to continue to provide homes to families in need for years to come.

Why did you decide to align Virani Real Estate Advisors with World Housing?

We believe not just in dreaming big but in making those dreams come to life. In many respects, World Housing’s vision to provide homes to families in need parallels our vision of pairing people with the homes of their dreams. We are a very fortunate society and we owe it to our brothers and sisters around the world to help each other when we can. World Housing’s one-to-one real estate gifting model is one of the best ways to give back to the developing world. It also partners with amazing organizations within developing countries to build community. These homes go to individuals who will take a leadership position and who have the initiative to better their community. What is critical too, is that these partner organizations work with people and families directly and teach them to be self-sustaining. That also resonates deeply with our belief systems as the best way to help people in need.

What does a home mean to you?

A home is a gathering place. It’s where individuals, families and friends can flourish, whether finding solitude or sharing. It’s a place where people can unwind, entertain, learn, and love. It is an environment where individuals should feel safe and protected. It’s also a basic human need. Everyone should have access to a home, and we are in the business of providing these spaces for people. We’re not in the real-estate business – we’re in the experience business. We can bring meaningful change to people and families and enhance the quality and direction of their lives.

Has the meaning of a home changed for you through out your career selling real estate?

As lives evolve and change, the meaning of home does as well. There have been many ups and downs within my career, and throughout this time my home has been a haven for me. I have also seen this with the clients I represent. No matter what happens in life, people need a home. The security of that is something we often take for granted and I love being a part of the process of finding that for individuals.

What is the most meaningful home you ever sold? Why?

I don’t have a particular home sale that is more meaningful than another. Each and every sale has been an opportunity for me to find a family their dream home, a builder their dream lot or a to help an investor grow their portfolio.

What do you look for in a home?

To me, a home is about balance: comfort and practicality. Due to the nature of my work, I have to be able to find a space that accommodates to my specific needs. Many nights I am working late so a home to me has to offer an environment where I can stay focused but also can unwind when I have a free moment. Location is something I also value. Vancouver is the most beautiful city in the world and looking out and seeing the city I love so much brings me joy.

What role do you think philanthropy plays in real estate?

To me, giving back to the community and the world isn’t just important, it’s a responsibility. In our field, we have the ability to provide homes for people who can afford to buy them. This is not the case for the majority of the world, and if there is a way to help families in need wherever they are in the world, we should be doing it.

What are your client’s reaction to your involvement with World Housing?

Many of our clients are excited to get involved in World Housing. With so many amazing organizations helping people around the world, it can sometimes be overwhelming finding one that connects with you individually. World Housing stands out because it does not just provide homes for families in developing nations, it provides a community full of leaders. Their influence radiates to other communities, ensuring that even after organizations step out, the community will continue to flourish. To World Housing, it is more than just providing a home to those in need, it is about teaching valuable life skills and educating individuals to lead a community.

What message do you have for other realtors that are considering giving back?

I urge everyone – not just realtors – to give back to the world and our community. We are in a privileged position where we can help, and we have a moral calling where we should help people who are less fortunate. Giving back doesn’t necessarily have to be in a monetary sense either. Even smaller gestures add up. It can be volunteering once a month, smiling at strangers, just spreading positivity around. We are all fighting our own battles, and it is important to stay grounded and realize all of us are essentially the same. We all deserve the same opportunities regardless of where we live. This is why World Housing is one of the best organizations to support – they provide opportunities for people to embrace their lives.

 

This article was written by Scott Wilkins courtesy of “Worldhousing”.

FILED UNDER Vancouver, World Housing    Leave a comment

2017 – What to Expect in the Vancouver Housing Market

Leading to and during last year, much of the real estate talk in Vancouver was centered on how to slow the market down in view of substantial price hikes.  But 2017 could spark a much different type of conversation.

The 64 million dollar question is “will the Vancouver house prices drop in 2017?” Housing experts state that while there are factors pointing to this, there is still much uncertainty especially as we come to terms with the fallout of some major policies introduced by all levels of government within the last 6 months; notably:

1) 15% Foreign buyer tax.  This tax was introduced in August last year by the Provincial government in response to a public outcry that blamed foreign buyers for the rising house prices.

Although it is not yet a 100% evident that the tax is responsible, the market for high-end homes has cooled with some of the foreign demand seeping into the Interior, Victoria and Toronto.  While demand has cooled considerably, prices have not gone down as expected.

2) Changing mortgage rules. Recently, more stringent mortgage qualification rules were introduced by the Federal government targeting first time homebuyers. Ottawa is worried that first time homebuyers are taking up too much debt,  which will cause a lot of concern if prices drop and interest rates rise.

First time homeowners are required to take a “stress test” to see how they can fare financially in times of adversity.

Other measures introduced include a decrease in the amount of money they can effectively borrow, in some cases as much as 20%. This means that first time home buyers will have to come up with a larger down payment than was previously required, forcing some to put their home purchasing plans on hold.

3) City of Vancouver empty home vacancy tax. In response to the general euphoria targeting foreign homebuyers who have bought local homes for investment purposes and left them vacant, and the very low rental vacancy rates, the Vancouver Municipal government has introduced a vacancy tax.

Beginning this year, homes in Vancouver that aren’t lived in or rented for at least half the year are now subject to an annual 1% tax. So for a $2 million home that qualifies, the owner will be responsible to pay $20,000 in taxes. Penalties for non-compliance are severe.

4) Interest free loan program for first time homebuyers. Yet to be implemented, this program introduced by the Provincial government for BC residents, offers a capped loan with a 5-year interest free period, aimed at helping first time homebuyers afford the down payment.

Since this program will be launched mid January, its impact will not be known for a few months. But the idea is to make home buying more affordable for first time homebuyers.

This measure somewhat contradicts the Federal government’s recent change in mortgage rules aimed at restricting first-time homebuyers as discussed previously.

We have yet to see the long-term impact of the recent policy changes, but one thing is certain – unlike previous years, this will be a very interesting year as far as real estate in Vancouver is concerned. So stay tuned!

 

We have been in the real-estate business for over 28 years. Our real-estate professional advisors are well qualified and experienced to give you their qualified opinions on the Vancouver real-estate scene. If you have any questions or concerns, please contact us or call us on 604 695 1000.

FILED UNDER Buying & Selling, Vancouver, Virani Tips    Leave a comment

How the New Empty Homes Tax Will Affect You

The Empty Homes Tax was introduced on January 1, 2017 to address the current state of the rental market in Vancouver, which has the lowest rental vacancy rates and the highest rental costs in Canada.

It is hoped that the tax will improve Vancouver’s vacancy rate, which currently stands at 0.6%, by persuading the owners of the thousands of empty apartments and houses to put them up for rent.

This December, if you own a residential property in Vancouver, you will receive a property status declaration notice for 2017, whereby you will be required to make a property status declaration, which will determine if you are subject to the tax.

Most properties will not be subject to the tax including those that:

  • Are being used as a principal residence by the owner, his/her family members, or friends.
  • Are being rented for a total of 180 days of the year, in periods of at least 30 consecutive days.
  • Meet the criteria of a list of permissible exemptions that have been outlined by the City of Vancouver.

If your home is deemed to be empty as a result of the property status declaration, it will be subject to a 1% tax of the property’s assessed value. For example, a home with an assessed value of $2 million will be taxed $20,000.

Non-payment of the tax (which will be applied annually) will be treated to the same treatment as property taxes, whereby there will be:

  • A late payment penalty of 5%
  • Daily interest on any arrears

There will be a rigorous audit process in place, especially in the early years of the tax. If you are found to have made a false declaration, you will be subject to potential fines of up to $10,000 per day, in addition to payment of the tax.

Empty Homes Tax Due Dates:

Property status declaration (for 2017): February 2, 2018

Empty Hoes Tax payment: April 16, 2018

Unpaid tax added to property tax bill: December 31, 2018.

 

If you require more information regarding this issue or any other developments that have taken place recently, please contact us or call us on 604 913 1000. Our real estate professional advisors will be only too pleased to be of assistance.

FILED UNDER Buying & Selling, Vancouver, Virani Tips    Leave a comment

The Principal Residence Exemption: The Tax Implications of Selling Your Home – Simplified

If you are one of the majority of the Canadians who own only one personal residence at a time, any gain on the sale of your home will be tax free, thanks to the Principal Residence Exemption (PRE). However, there are other factors that come into play that could impact your ability to fully or even partly shelter the appreciation of your home from tax.

You can use the PRE to reduce or eliminate the capital gain on the sale if your home when it meets certain conditions.  The CRA states that in order for your home to qualify as a principal residence for a particular year, the following must apply:

  • You must own it (either alone or jointly with another person);
  • You or your family members must inhabit it at some time during the year; and
  • No other property may be designated as the principal residence of any other member of your family unit for that year.

Here are some of the basic issues concerning the PRE:

Renovating and “flipping”

If you bought a home, renovated it, lived in it and then sold it, it may not qualify for the exemption, as the CRA may determine that the gain on the sale represents business income and thus would be ineligible.

Purchases made before 1982

Prior to 1982, you and your spouse could each have designated a separately owned home as a principal residence and sheltered each home from tax on capital gains. This allowance was cancelled on Jan 1 1982.

Renting out your home.

The PRE does not qualify if you:

  • Own the home just for rental purposes
  • Rent out more than 50% of the home

If you rent out your basement and claim a capital cost allowance on your taxes, by claiming the PRE, you may trigger a CRA review.

Size of your home lot

There are restrictions on the size of the area on which your home sits on. If the lot exceeds one half hectare, you may be required to show that the remainder of the lot is needed for the use and enjoyment of the residence.

Vacation property

In some cases, you may be permitted to chose a vacation property as your principal residence, but only if it is for your own vacations and not used to earn rental income.

It isn’t advisable to simple take for granted that the sale of your home will be tax-free. Consult an accountant or lawyer for the correct professional advice and information.

We have sold thousands of homes for hundreds of satisfied clients. If you are considering selling your home, we can find you a qualified buyer and remove the stress. Contact us on 604 913 1000, visit one of our offices or email us.

FILED UNDER Buying & Selling, Vancouver, Virani Tips    Leave a comment

The New Provincial Down Payment Loans Assistance Program For First Time Buyers – The Facts

For those individuals having trouble getting into the housing market, starting on January 16, 2017, the BC government will be offering down-payment loans for first-time homebuyers. The new loans are called the BC Home Owner Mortgage and Equity (HOME) Partnership program.

The 25-year loan is interest free for the first 5 years and covers up to a maximum of $37,500. After the initial 5 years, market interest rates will apply.

To be eligible, the applicant must:

  • Have saved a down payment amount at least equal to the loan amount.
  • Have been a Canadian citizen or PR for 5 years.
  • Have lived in BC for at least 1 year.
  • Will use the property as their principal residence for the first 5 years.
  • Have not owned an interest in any residential property anywhere in the world at any time.
  • Purchase a home with a price tag of less than $750,000.
  • Be able to qualify for an insured high-ratio first mortgage for at least 80% of the purchase price.
  • Have a combined gross household income of no more than $150,000.

According to Jill Oudil, president-elect of the Real Estate Board of Greater Vancouver, the program will help first-time buyers overcome a “key obstacle” to home ownership, and it will give young families the incentive for the down payment that would have otherwise might have seemed unattainable.

Architect, planner and adjunct professor Michael Geller said that the supply of new housing in Metro Vancouver is limited relative to the demand, and while this program could further increase demand, he believes it will offer a greater incentive to builders and developers to initiate new projects.

BC residents buying their first home can also get assistance from other housing programs like the First Time Home Buyers’ program and the Newly Built Homes Exemption.

If you are a first-time homebuyer, why not let the expertise of our real-estate professionals give you the best advice? Call us on 604 913 1000

FILED UNDER Buying & Selling, Vancouver, Virani Tips    Leave a comment

When is The Best Time To Sell Your Home?

Most real estate professionals will agree that there are certain times of the year that are more favorable to sell your home than others. Often, the best time to list and sell a single family detached home is in early spring and summer and early to mid fall.

Spring and early summer offers the best time to showcase your home. Once winter is finally over, as the flowers start to bloom and the weather improves, there is a tendency for people to get that “moving bug”.  Buyers may be armed with their tax refunds to use for the down payment and if they have kids, there is no concern about the school year being interrupted.

It is also easier during this period to get your home ready for sale. Remember: since this is historically the busiest time for home sales, you will face more competition as many other homeowners will be thinking along the same lines.

After summer, early fall is the next best time to list your home, especially after a nice warm summer. The beautiful colors that fall is typically associated with mixed with the nice, crisp cool temperatures, will give you another great opportunity to sell your home.

Having said this, town homes and condos  – primarily aimed at first time homeowners, will sell at any time of the year.  These buyers do not have the same constraints of factors such as school catchment areas, preferring proximity to a recreational facility, a transit station or a shopping mall. They are more likely to buy at any time of the year, depending on the property offered for sale and their budget.

Just a quick note to buyers – you may get a good deal in the winter time, as the chances are that the home owner is eager to sell as he/she cannot wait until the traditional selling period.

In our opinion, there is no wrong or right time to sell your home, especially if it is priced right and presented properly. You have to be realistic in your expectations.

 

Please feel free to call THE VIRANI SALES TEAM at 604.695.1000 or email if you would like further explanation on any of our blog topics, or if you have any real estate questions at all.

FILED UNDER Buying & Selling, Vancouver, Vancouver Luxury Condos, Virani Tips    Leave a comment

Is the Vancouver Real Estate Market Cooling or Correcting?

Around 6 months ago, Vancouver was dubbed as North America’s “hottest” real estate market, where some home prices were increasing by literally $1000/day. Open houses had line-ups within minutes of opening and listings received multiple bids over asking.

In an effort to appease the disgruntled home-buying electorate who were being forced to move to the suburbs, both the BC and federal governments brought in a number of measures to address the soaring housing costs.

It looks like these measures have worked to cool the market somewhat, and there is consensus among realtors that we are currently entering the fourth month in a consecutive buyers market.

Buyers are waiting for prices to drop further and sellers are waiting for a rebound in the market. Inventory levels are now climbing up to “normal” levels, but the sales are not there.

Statistics released by the REBGV for September and October have shown that sales are down from similar periods last year, but prices are not dropping as dramatically as the statistics show. So why is this happening?

To understand the relationship between supply and demand, the sales-to-active-listing ratio is used. In March of this year, the ratio was a whopping 70.3%. In September and October it dropped to 24.4%. When the ratio drops below the 12% mark for a number of months, there is downward pressure on market prices. When the ratio exceeds 20% for a number of months, there is upward pressure on market prices.

The average price of a home in Vancouver was $600,000 in 2006 and has jumped to around $1.4 million in 2016. Many of the current homeowners who have put their home on the market have seen a large increase in the value of their home in the past few years. So many have dug in and are not in a big rush to sell if they don’t get near their asking price.

BC still has a strong economy and better growth than most of Canada. There are more people migrating into BC than to other provinces in Canada. These people need to live somewhere. So it looks like that this situation will not change for the foreseeable future.

One thing that everyone agrees about is that there is uncertainty in our current market:

- What will be the full-blown fallout from the new mortgage rules, which could be a trigger or catalyst for far reaching implications for the housing market?

- The 15% foreign buyers tax which has forced many potential foreign buyers to look East and South – for how long?

- The aftermath of the Trump election – how will it affect us in Canada in the next few years?

 

If you are currently looking into selling your home, contact us or call us on 604 913 1000 and we will put you in touch with one of our real estate professionals who will get you a very competitive price. Remember, we have been in the real estate business for over 27 years.

FILED UNDER Uncategorized    Leave a comment