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.

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How Severe is the Impact of Airbnb and Other Sharing Sites on the Vancouver Rental Scene?

Historically, Vancouver has had a very low rental vacancy rate (currently around 0.3 – 0.6%) and with the advent of Airbnb and similar home sharing platforms, the problem has been exacerbated.

Airbnb listings are increasing quite dramatically around the world and Vancouver is no exception. Since December 2014, Airbnb listings in Vancouver have increased by over 20% and this figure is on the rise.

A study done on the effect of Airbnb on the Vancouver market by Karen Sawatzky, an urban studies student at SFU, reiterates this surge of Airbnb listings in Vancouver. Her study proved, amongst other things, that the number of Airbnb listings is on the rise – she found 2798 listings in January 2015 and 3,473 just five months later. Vancouver has become one of the 10 most important markets for Airbnb in North America.

Landlords and property owners can make a lot more money renting their units on Airbnb than on the regular market rentals. According to data from the CHMC, average rents for a 1-bedroom run around $1,100 a month depending on which part of the city the property is located. The same apartment could earn around $140/night on Airbnb. Large homes have been listed for $500-$900 a night!

While the financial incentives for conversion may be great, the process could have grave potential consequences to the renter. Renovations may be taking place without local government approval. Without the proper inspection and approvals, there could be a number of safety violations that the unsuspecting short-term renters would be unaware of.

So in its quest to reduce the rental crunch in Vancouver and introduce some formality and order to the short-term home rental market, in October, the Vancouver City Council voted in principle to green-light short-term rental regulations. These will include licensing fees, advertising regulations, and a scrutiny ownership – the property has to be a principal residence.

There has been considerable public outcry about the rental shortage in Vancouver, and both provincial and local governments are continually making new policy to address the issue. Affordable housing is no longer affordable in Vancouver and there is still a lot to do to remedy the situation.

If you are looking to rent or rent out your home, let our Property Rental Specialist find you the ideal home to rent or the ideal tenant. Simply fill out this form, or contact us on 604 913 1000.

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Leaving Your Home For A Period Of Time? Take Heed Of This Important Insurance Advice.

If you are leaving your home for a lengthy period (over 4 days), you must make sure that you understand how your insurance works when you are not occupying your home. The first and most important thing to do is to call your insurance company and inform them of your absence, and inquire if there are any special precautions that you have to take before your departure. 

Remember, an unoccupied home is at greater risk of damage and more susceptible to theft. What most people don’t know, and many people in the insurance industry don’t tell you, is that you’ve made a promise to your insurer that you’ll do certain things in the event you leave home for four or more days.  It’s important to note that unlike automobile policies, there is no uniformity amongst property insurance policies. 

Here are some basic preventative measures most insurance companies will advise you on that can help you avoid unfortunate situations such as theft, power surges and broken pipes:

  • Have someone check your property if you are going away for more than three days and specifically ask them to check for any water leakage in the basement or ceilings.
  • Unplug non-essential appliances to help protect them from power surges and to save on energy.
  • Have a neighbour remove newspapers and flyers outside your home. If that is not possible, then put your mail and paper delivery on hold until you are back.
  • If you have a home alarm system, let the alarm company know when you’ll be away and ensure that your call list is up-to-date.
  • Invest in a timer so it looks like the home is occupied both inside and outside.
  • Let a neighbor know where you’re going, when you’ll return and how to reach you. Ask them to call if they notice anything strange.
  •  During the wintertime make arrangements to have the snow shoveled when necessary.
  • Ensure you maintain proper level of heating in your home to avoid pipes from freezing.
  • Shut off the water and insulate any pipes that pass through cold zones, such as the attic, so the pipes don’t freeze and burst.
  • And most important, don’t mention your absence on social media.

 

Because we have been in the real estate business for over 30 years, we can professionally advise you an all aspects of buying or selling your home. Questions?  Contact us and follow us on Facebook.

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Absentee Homeowners in Vancouver Could Soon Face Penalties of $10,000/Day

In the last few years, Vancouver housing has been facing an affordability crisis and rental vacancy rates have shrunk to unprecedented lows. This has caused an uproar amongst the local population, and politicians have been scrambling to appease them.

In August, the Provincial government announced a 15% tax on foreign buyers and on Wednesday November 9, the Mayor of Vancouver Gregor Robertson announced the recommendation of a 1% tax on vacant homes, to be followed by several other moves on the housing front.

“Vancouver is in a rental-housing crisis,” Robertson said. “The city won’t sit on the sidelines while over 20,000 empty and under-occupied properties hold back homes from renters.”

A city commissioned study in March of this year, indicated that around 11,000 housing units in Vancouver had remained empty for 12 or more months. Not good news for a city where rentals get picked up within hours of listing due to the acute shortage.

Summary of the Mayor’s actions:

  • The empty home tax will come into force on January 1 and will be calculated at 1% of the property’s assessed value.
  • All Vancouver homeowners will be required to declare their principal residence (or tenancy), similar to declaring the Home Owner Grant, which generally will not be subject to the tax.
  • The proposed tax will be implemented with very high levels of audit in the first months and years it is in effect.
  • People who fraudulently declare their house is a principal residence or rented out when it isn’t may be charged a penalty of up to $10,000 a day for as long as the offence continues.
  • People who pay the new tax late will face a 5 per cent penalty, while those who don’t declare will automatically be taxed.
  • Snowbirds and other residents who live only part of the year in Vancouver would not be taxed.

The mayor wants to use the proceeds from the tax to build affordable housing. It is hoped that this will relieve pressure on Vancouver’s tight rental market by opening up new rental spaces and subsidizing affordable housing.

Virani Rentals offers a collection of homes, apartments, townhouses and penthouses for rent. We are industry leaders in the Vancouver Real Estate market therefore you have the comfort of knowing that you are getting good value for your dollar when renting from us.

 

If you have a home or apartment to rent, let our rental experts take this for you.

 

Complete and submit this form or call 604-695-1000. Our Property Rental Specialist will contact you shortly.

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Will a Trump Presidency Mean Higher Home Prices in Canada?

Following the surprising election of Donald Trump as the next President of the US, a lot of attention is being directed at disgruntled Americans possibly moving to Canada.

The US election has heightened the brand and perception of Canada as an attractive, welcoming, tolerant and stable country. On Election night, the Canadian immigration website crashed which is indicative of the level of interest Canada is getting. But don’t expect a flood of President-Elect Trump exiles flooding into Canada – yet.

There is still a lot of uncertainty: will President-Elect Trump move forward with his policies? How disruptive will they be? People are still in the information gathering stage, looking at their options.

If Americans do decide to move north, the impact may be felt in the larger urban areas which are more known than the rural areas. Many could use the “toe in the water” approach by buying a small property to start off with.

The weakening Loonie is an attractive option. The fact that our dollar is 30% cheaper than the US one, makes our real estate 30% cheaper than US and other countries.

We are also neighbors with the US. Our geographical proximity makes it easier for Americans to hop on a 3-4 hour flight or make a 5-6 hour drive to our country, than to go anywhere else.

There are those who argue that the situation in Vancouver may be a little different than the rest of Canada. Home sellers in Vancouver shouldn’t expect a big uptick in American interest, as the Foreign Buyer’s tax that was announced and introduced this past August, has dampened interest in property in the Lower Mainland.

It is important to note that the impact of the tax has been on the more expensive $2-3 million plus homes, whose prices have come down proportionately since August.

Since the election, there have been a lot of conversations with realtors, but no moves are imminent. Our real estate industry is attractive to buyers worldwide and whether we will see more interest from the US as a result of the election…It’s wait and see for the time being!

 

If you are planning on buying a home, its important to use a reputable realtor that is familiar with the region. We have been leaders in the real estate industry for over 28 years. Contact us or call us on 604 913 1000.

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The Home Inspector – Important Facts You Must Know

A home inspector is often relied upon to vet what is often the largest and most important purchase and investment of your life. If the inspector fails to spot an important issue, you as the homeowner can be left on the hook for thousands of dollars worth of unexpected costs.

Theoretically, a home inspector should give you a through assessment of every single part of any home and help you understand what it means.

Getting a comprehensive Home Inspection Report is pretty much standard when buying or selling a home. While a report is useful, it has its limitations and you as a buyer or seller must be aware of this.

The Home Inspection profession is by and large unregulated.

There are a number general contractors posing as inspectors without having completed any sort of professional training. Their services may be cheaper and they may have considerable experience in general contracting, but no formal home inspection training.

Always make sure the individual you hire is licensed or certified. This does not guarantee competence, but it is an indication that the individual has completed a minimum level of education. And if there is a problem, you may have a better chance of recourse.

A home inspection does not eliminate all risk.

A typical home inspection is only visual. Inspectors look for clues that can uncover possible defects and abnormalities. They cannot tear open walls, expose the waterproofing of windows or remove parts of your home.

A competent home inspection should alert you to limitations, but the risk of potential problems remain even after the best visual assessment of the problem.

Be prepared to bring in an expert.

If the report shows areas of possible concern, be prepared to call in the experts. For instance, cracks in the wall may require the use of a structural engineer, poor drainage may require the use of a hydrologist, and faulty wiring will require a professional electrician to review the electrical system.

Pick a qualified inspector – not necessarily the cheapest one.

Sometimes with all the costs associated with buying a home, your choice of a home inspector may be influenced by price. Ideally a home inspector should be well trained, experienced, professional, trustworthy and independent. Some of the best in the field may be the most expensive.

A professional inspector should have a registered company, physical address, website and company phone number. They should have equipment on hand such as thermal cameras, meters, testers and inspection software that generates a comprehensive report for you to see.

Important questions you MUST ask a home inspector:

1)      Are your certified? When and by who?

2)      Are you insured?

3)      How long have you been inspecting homes?

4)      Can I see a copy of a recent report?

On September 1 new rules were introduced by the BC Provincial government that will “enhance home inspector licensing qualifications, strengthen home inspection reports, contract and insurance requirements and improve enforcement.”

If you require the use of a reliable home inspector for a home inspection, please contact us and we can forward the details to you, or call us on 604 913 1000.

 

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Some Great Tips On Staging Your Home Inexpensively

Most of us use our visual sense to make a purchase decision. A potential homebuyer will have difficulty visualizing an empty house as opposed to full one. So it is important to create a warm and inviting atmosphere for the potential buyer.

Here are some great inexpensive staging tips:

Kitchen

-          Accessorize – add decorative items to make the area more ‘cozy’

-          Unclutter counters – remove unnecessary items off counter tops.

-          Offer snacks – filling a large bowl with candy and pre-packaged snacks for buyers passing through will help them remember your listing, especially if they grab one.

-          Bake something – the smell of fresh bread or a pie in the oven is always appealing.

Bathroom

-          Close the lids – keep all the closets closed, close the toilet lid, open the curtains to let the sun/light in.

-          Flowers and candles – dried flowers and candles in complementary colors give the room a real boost.

Bedroom

-          Add a bed to a vacant room  – use boxes or an air mattress and dress it up with nice bedding.

-          Add luxurious, affordable touches – a new luxury comforter set with accompanying pillows, frills, valances etc. This can transform a boring bedroom into a luxury hotel suite!

Living Room

-          Create a focal point – pick a prominent corner, add a large plant and set up a spotlight behind it throwing a shadow and highlighting the leaves.

-          Arrange the furniture  – place the furniture in a manner that suggests conversation and entertainment without much rearranging.

Color and Lighting

-          Be neutral – with bold colors, potential buyers may find it difficult to envision their perception of how the room may look with their furniture in it.

-          Lighten up – replace the light bulbs with higher wattage bulbs making the rooms look bigger and brighter.

Other Tips

-          Neutralize the home – remove personal items and clutter. Potential buyers should see a room they can envision themselves living in.

-          Touch up painting – make sure that there are no scratches, scuffmarks and blemishes on the walls especially in the hard to miss areas. Repainting a few walls, such as those in the hallways, kitchen and bathrooms may give the appearance of a well kept and tidy home.

-          Traffic flow – arrange the furniture in a manner that does not block any of the home’s features and allows for easy traffic movement.

 

Home staging can make the difference on how quickly your home sells. We have a thoroughly experienced and competent group of real estate professionals who can advise you on how to stage your home. Contact us by email or call us on 604 913 1000.

 

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22 Vital Tips Every Parent Should Know To Ensure A Safe Halloween This Year

Halloween is beyond exciting for many kids – they get to dress up, stay up late and are rewarded with a windfall of candy! So it makes sense to ensure that parents take all the necessary steps to ensure that the evening is a safe and enjoyable one.

Here are some important tips to ensure this will happen:

Costumes

  • Make sure the costumes fit properly to prevent trips and falls
  • Wear comfortable, practical shoes
  • With dark colors, add some reflective tape/accessories to the costumes to make the children visible
  • Give the kids a flashlight and or carry one with you
  • Sometimes masks can obstruct vision, be sure that child can see clearly through the mask – consider using face paint instead….

Road Safety

  • Always use sidewalks or paths. If there are no sidewalks, walk facing traffic as far to the left as possible.
  • Cross the street at corners using crosswalks and traffic signals
  • Always keep an eye out for cars backing out of or turning into a driveway
  • Don’t cut across yards and stay out of backyards
  • Follow the traffic signals and avoid jaywalking
  • Younger kids should travel with an adult and older kids should walk in groups for better visibility and safety
  • Stick to roads and paths that are familiar
  • Make a map and decide the route to be taken. This can help avoid stranger’s houses and puts a time limit on trick-or-treating to prevent sore legs post-Halloween!

Candy

  • Inspect the candy before the kids start digging in (it’s difficult, but important)
  • Discard packages that have been previously opened or not in the original packing
  • Be weary of homemade candy/treats
  • When accompanying friends or relatives’ children during trick-or-treating on Halloween, be aware of allergies, especially to nuts, dairy, chocolate or gluten.
  • Carry a spare Halloween bag in case the one being carried breaks or becomes full

Etiquette

  • Be polite and always say “Thank-you”
  • Always respect people and their property
  • Don’t trample through flower beds and gardens
  • Always make sure to close any open gates when leaving

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

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The Real Costs of Buying A Home – What Every First-Time Home Buyer Should Expect

For many of us buying a home is the biggest investment we will ever make.  When you are in a position to buy a home, there are 2 financial aspects you should be aware of:

1. The ongoing costs of homeownership

  • Regular mortgage payments
  • Property taxes
  • Utility costs
  • Maintenance and upgrades
  • Home insurance
  • Condo fees/neighbourhood association fees (if applicable)

Mortgage lenders prefer that clients spend no more than 32% of their gross monthly income on housing.

What you need to figure out is if you can afford that even if the bank/lender approves you for a large mortgage.

You have to consider your debt, your savings and your lifestyle – you don’t want to take up too much and become “house poor”.

2. The upfront and one-time costs of buying a home

An important consideration is your down payment. The larger the down payment you can contribute to the purchase price, the smaller your mortgage payments and the less interest you will pay on the loan.

If you can make a down payment of at least 20% of the home’s value, you will not have to buy mortgage insurance as required by law, which will add to your monthly burden.

If you qualify as a first time homeowner, you and your spouse can borrow up to $50,000 using your RRSP funds for your down payment.

Other upfront costs:

  • Deposit
  • Home appraisal cost
  • Home inspection
  • Lawyer fees
  • Transfer taxes – Provincial/Municipal
  • Moving costs

Set up or administration fees for the various utility providers

If you plan carefully, save for a down payment, have a good understanding of how mortgages work and the costs associated with home ownership, your dream of owning a home can become a reality.

 

If you are a first-time buyer looking for that ideal home that fits your budget, talk to one of our experienced real estate advisors. We have been advising clients on real estate in Vancouver for over 27 years. Please call on 604 913 1000 or email us.

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When Is The Best Time To Buy A Security System For Your Home?

There is no “best time” to buy a security system, however, if you pay attention to security company websites, flyers etc. you may be able to get a good deal through out the year.

But if you want to compare the best time to buy with intruder statistics, the peak time for break-ins usually coincide with:

  • Days after holidays such as Christmas, Easter etc.
  • Beginning of the school year.
  • Thanksgiving weekend.

If you are worried about buying because you want to get the best possible deal, go online and do your research. Companies are offering special deals throughout the year.

Many security companies send flyers through the mail – so keep a keen eye on the junk mail you receive. If you prefer a certain company over another that is offering a deal, take the deal to your preferred company and show them the offer. In many cases, they will match the price.

Keep a close eye on what is happening around your neighborhood. If you read about a spike in break-ins in your area, it may be a good time to get a security system if you don’t have one.

Sometimes it is better to be protected even if you don’t get a discounted deal on a security system.

Remember, there is no real perfect time to buy a security system. The perfect time is anytime before you get a break-in. As long as the system is in place before the danger arises, you have good timing!

 

If you have any buying/selling related issues, contact our experienced real estate advisors, or call 604 913 1000.


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