First-time buyers hoping to get on the property ladder in expensive cities like Vancouver and Victoria may be able to get some assistance this year with the new BC Government Down Payment Plan. The plan, designed to help homebuyers put together money for the down payment with a 25-year loan, will match buyers’ contribution up to a maximum of $37,500. While this is good news as it helps to relieve the pressure on the bank of mom and dad, there are a few things you should think about if you’re wondering whether you should lend your child money to buy a home.

Is it a Gift or a Loan? And to Whom?
There’s nothing to say that you shouldn’t help your child or family member come up with a down payment. But, there are a few things that you need to clarify right from the beginning.

Let’s suppose you give your child half of the down payment, and the government foots the rest. Have you given the money as a gift, or a loan? Family Law Firm Brown Henderson Melbye (BHM) says that, “What is particularly good to know is whether or not any money the child received from a parent came to them as a gift or a loan, and whether it came to them alone or to their partner as well.”

Get it in Writing
It can be tricky getting the law involved when it comes to family agreements, but it’s vital. You’d be amazed at how useful having a contract is, especially if you run into any conflict further down the line.

BHM Lawyers note, “It is really important, particularly in the context of the Family Law Act, British Columbia’s statue that guides the division of assets when couples separate or divorce, to know who owned what at the beginning of the relationship and who was gifted or who inherited what money.”

Consider getting a pre-nuptial agreement or cohabitation agreement drawn up by your lawyer to ensure that the couple knows exactly what’s going on with the finances.

Look After Your Interests
Before you go ahead and make an offer, calculate the monthly mortgage repayments, taxes and duties, and any renovations that the home requires. If your child is just starting out in their career, can they afford to make the monthly payments? If you’re going to use up your savings to raise the deposit, will you be financially secure? Hire a lawyer to help with the legal process and ensure you have a clear picture of everything from the very beginning.

If you have any questions about the BC Government Down Payment Plan or want to discuss anything mentioned in this article, feel free to get in touch.

In part three of our three part series on Should I Buy Or List First?, we explore the pros and cons of drafting a conditional offer on a property. In case you missed part two of our series here on buying your new home before selling your current property, click here.

Strategy #3: The Conditional Offer

The third option at your disposal when deciding whether to list your current home before or after purchasing your next home is to draft a conditional offer (also know as a subject-to-sale offer).

Unlike strategy #2 (buy first, sell later), whereby you commit yourself unconditionally to the purchase of a new home prior to selling your existing home, with a conditional offer, you are only committing yourself to purchase your new home if your existing home sells by a specified end date.

While the conditional offer strategy sounds almost too good to be true, it falls short in a few different ways:

1. There is typically a clause in this contract that allows the seller to continue to market their home even after the conditional offer has been accepted. During this time the seller is able to entertain offers from other bidders. If the seller wishes to pursue any of these other offers prior to the sale of your home, he has the right to do so, but must give you the right of first refusal. If your current home has not yet sold, you will be forced to walk away from your purchase unless you are willing to shoulder the prospect of holding two properties (and mortgages) at once.

2. Sellers typically view conditional offers as “second rate”, and in many cases will only entertain them if their property has been languishing on the market for some time. In hot real estate markets, the likelihood of having an offer accepted with a subject-to-sale clause present is very low. In order to compensate for the inherent unattractiveness of these sorts of offers, buyers must often offer a generous price premium in order to attract the attention of sellers.

In a lot of ways, the conditional offer is the middle ground between the other two options we’ve discussed in this three part series. While on the surface it appears to be a good solution for those who are unsure of whether buy or sell first, in reality, this approach lacks the clear advantages that the other two strategies confer. The fact that another buyer can show up at any stage of the process and “bump” a conditional offer means that you might have your heart set on a home that another purchaser can easily fly in and snatch from under your eyes.

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

In part two of our three part series on Should I Buy Or List First?, we explore the pros and cons of buying your new home first, and then working under a fixed timeline to get your current home sold. In case you missed part one of our series here on selling your current home first before going ahead with your purchase, click here.

Strategy #2: Buy First, Sell Later

The “buy first, sell later” strategy definitely isn’t for the faint of heart, but when the stars are aligned and this strategy pans out, the benefits are great!

Typically, the types of individuals who opt for the buy first, sell later strategy are those who are interested in purchasing a new home that is so unique or so remarkably well-priced that it’s a true rarity to find on the market.

If you’re unsure just how unique the home you’re looking for is, your Realtor should be able to conduct a retrospective sales analysis for properties matching your search criteria in your target neighbourhood to see how regularly they come available. As a rough rule of thumb, if less than four listings matching your criteria come available within a calendar year, the property you’re looking for is probably unique.

While striking when the iron’s hot always has its allure, it’s important to also keep in mind the obvious downsides that come with this strategy. Namely, if you commit to purchasing a property and are unable to sell your current home on the schedule you had initially forecasted, you might be in a position where you hold title to two properties concurrently. Are you in a position where you would be able to shoulder two mortgages at the same time? Even if a lender was willing to extend that much capital to you, how much stress might a double mortgage payment every few weeks cause you? What impact might this stress have on other aspects of your life or your other financial goals?

There is always a component of luck when it comes to home sales. Despite the best efforts of your Realtor, even the most brilliantly marketed home offered at the most competitive price might not sell if the “right” purchasers aren’t out shopping the market. Of course, by reducing the list price of your current home further you might be able to stoke up some buyer demand, but no one likes having to sell their home at a loss—especially when the market is hot!

In short, if your finances are tight and you are even somewhat prone to worrying, the buy first, sell later strategy probably isn’t for you. However, if you have some extra capital on the sidelines and you are willing to shoulder the possible financial storm to land just the right new home, the pay offs from this approach can be great.

Read Should I Buy Or List First? – Part III now!

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

One question I routinely receive from homeowners who are looking to both sell their existing home and purchase a new home simultaneously is: Where do I begin?

That is to say, these homeowners are seeking direction as to whether they would be better off to first find a new home that matches their search criteria before placing their existing home on the market for sale, or if they should sell their current home and have the cash from that sale in hand before the begin their search for their next home.

While there is perhaps no one universal answer to this question, in this three part series we will explore the pros and cons of:

1. Selling your current home first, and then starting your new home search;
2. Buying your new home first, and then working under a fixed timeline to get your current home sold, and;
3. Drafting a conditional offer on a new property that’s contingent on you selling your current home by a certain date. In this scenario, if you are unable or unwilling to sell your current home by a certain date, you are no longer compelled to complete your purchase.

While drafting a conditional offer appears on first blush to be the most preferred option, as we will see, this strategy (much like the other two) also comes with its fair share of shortcomings.

Strategy #1: Sell First, Buy Later

For many homeowners, the “sell first, buy later” strategy is the preferred option.

The beauty of this strategy lies in the fact that by selling your home first, you will have a firm sense of exactly how much cash you will have in hand before you even begin your subsequent purchase. If you are the sort of person who is vigilant about living within your means, this strategy will suit you well. By having a firm sense of your affordability from the moment you start your house hunt, you will be able to quickly sift through prospective homes as either being within your means or not, and have a firm basis for your negotiations with sellers. This confidence in your tactics will allow you to outcompete many other prospective purchasers who are less sure about their financial position and vastly increase your chances of having your bids be successful.

Depending on market activity and your own personal motivations, you might be inclined to come forward with an unconditional offer on your new home. In certain segments of our housing market sales figures have been so strong that, homeowners will now only entertain conditional offers. By having cash in hand from your previous home sale you will be in a position to compete with developers, investors, and other parties who have no qualms about coming forward with unconditional offers.

While generally the “sell first, buy later” strategy seems quite appealing, where it falls short is if you have not found your next home by the time you’re required to vacate your current property, you might have to seek temporary accommodation. Generally speaking, homeowners in the Vancouver market have between one and three months between the time of contract signing and the new owners taking possession of their home, which is sufficient for most folks to sleuth out their next home—provided that they have a clear understanding of their buying power and overall housing stock availability.

Read Should I Buy Or List First? – Part II now!

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

Purchasers tend to have pretty strong views on ground-floor condos. Regardless if it in a two storey low-rise building or a thirty storey skyscraper, ground floor condo units (units with direct access through one or more doors to the outside of the building, but which also have common hallway access) speak to a certain type of buyer.

The main selling features of a ground-floor entry condo include:

1. The look and feel of a townhome, without the price tag. Similarly sized ground-level condo units typically fetch far less on a dollar-per-square-foot basis relative to townhomes.

2. Yard access. While not a hard-and-fast rule, most ground-level condos come with some measure of yard space. Although that yard space is often designated as common property or limited common property, in practice, yard space directly in front of a ground-level condo often functions as a private garden.

However, ground-floor entry condos do come with their drawbacks, as well, namely:

1. Privacy. Being at ground level means that anyone walking past on the street or on common property surrounding the development have a straight shot to peer into your home. Depending on how busy the surrounding area is, having to keep your drapes or blinds closed during the daytime might be necessary to maintain privacy.

2. Security. Given that ground-floor entry condos are at street level, the possibility of theft from such units is typically much greater than for upper level units. Most condo units do not come with a security system at the time of original construction. However, many owners of ground-level condo units choose to make this upgrade to ensure that their space is secure—much as one would expect from the owner of a detached home.

While this article provides a nice synopsis of the key features underlying whether or not ground-floor condo living is a viable option for an average purchaser, there are countless other factors that might play in to one’s decision of whether or not a ground-level condo unit is the right choice for them.

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

More and more home sellers are having their homes professionally staged in advance of the big sale. The good news is that a lot of staging can be achieved with just a little bit of elbow grease and a shoestring budget. Here are a few top staging tips to make sure your home is showing a “10” when it comes time to list:

1. Declutter. Decluttering is perhaps the simple and most effective step you can take when preparing your home for sale. As a general rule of thumb, any furniture, nick-nacks, or other gadgets that are taking up space but don’t provide much function should be stashed away. In particular, personalized items (e.g., family photographs, children’s artwork, etc.) should be removed from a home prior to listing to enhance the overall appeal of the home. The great news is that by decluttering, rooms will naturally start to feel a little bit larger and more airy.

2. Lights. Make sure that all lights have working bulbs and that the bulbs are the highest power (Watts) rating for the fixture. It’s amazing how a little extra light can go a long way towards showcasing your home at its best!

3. Paint. Repainting is one of the most cost-efficient means of preparing your home for sale. Even if the current paint isn’t faded, peeling, or marked up, ensuring that neural colours are used throughout your home will help provide it with broader appeal. Even if bright and bold colours are appealing to you, if they “turn off” the average purchaser, they need to be ditched. A subtle way of reintroducing colour into a room is through key accents (e.g., sofa cushions, a kettle, etc.) or flowers.

4. Linens and Towels. Although it’s human nature to want to limit outgoing expenses in advance of a home sale, one area where it might be okay to splurge a little would be on bed linens and towels. If you want to provide the impression that a home is well-cared for without spending a fortune, having bed linens and towels that are crisp and clean is a good place to start. As before, going with neutral shades for bedding and towels ensures that your home will have a tidy, contemporary feel.

These are just a few ways in which the overall aesthetic of a home can be enhanced in preparation for sale. No two homes are the same and no two sellers are willing to invest the same amount of time and effort into maximizing their home’s sale potential. At the end of the day, when it comes to staging a home for sale, it’s really a classic case of what you put into it, is what you will get out of it.

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

Recently the Real Estate Board of Greater Vancouver published data characterizing evolving trends in the Vancouver real estate market. The data was collected by sampling 160 Realtors active within the region to garner their professional opinions on market trends. Here are some perhaps surprising take-aways from that report:

1. First-Time Homebuyers. First-time homebuyers accounted for roughly one-third of all purchases in the first half of 2014. This figure is pretty much exactly in-line with purchaser trends for the region over the last five years, which typically fluctuates between about 25-50%. While there were no hard figures published on the mean age of these first time buyers, it would be curious to see if there has been an upward trend over the past decade. Anecdotal evidence would suggest that ever-rising prices in our local market has delayed many new entrants from taking the plunge and entering the real estate market.

2. Downsizers. Almost 8% of home purchasers in June reported moving from a detached home to a townhome. There has been a noticeable trend over the last few years of more and more downsizers moving from detached residences to townhomes and condominiums. It’s postulated that this activity is largely driven by empty nesters, who in their retirement years no longer feel the need to hold on to their homes until the bitter end. Rather, increasingly, the data would suggest that mature Canadians are looking to gradually scale back their homes to something more manageable as they move in to their retirement years and beyond.

3. All cash purchases. Over the course of the last few years there has been a trend toward fewer home purchases involving high-ratio mortgages (<25% downpayment) and a general increase in “all cash” home purchases in the Vancouver area. While the reasons behind this are likely complex, these trends can at least be partially attributed to ever-tightening mortgage lending rules. In general, these rules are felt to have put increasing pressure on parties with lower declared incomes, including first-time homebuyers, the self-employed, and some newer immigrants. 4. Overall consumer behaviour. As is typically indicative of a warming housing market, Realtors involved in this survey have identified increased open house traffic, increased bidding war activity, and decreased numbers of collapsed deals over the last several months.

With all these factors in mind, the Vancouver housing market appears poised for a solid conclusion to 2014.

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

The short answer to this question is “yes”, but while it’s possible, it’s certainly not advisable. Here’s why…

In “hot” real estate markets, where buyer demand is high, the supply of available housing is low, and a sense of generalized panic fills the air, it’s not uncommon for prospective home purchasers to get caught up in the frenzy. It’s often in these sorts of climates when my clients approach me asking if they can put forward bids on multiple properties at once, in order to expedite the bidding process and secure a home.

While there is legally nothing stopping them from putting forward bids on as many homes as they want all at the same time, problems will arise more than one of the sellers of these properties decides to accept the buyer’s bids without revisions to the contract.

Of course, the challenge here lies in the fact that the buyers will now be compelled to proceed with the purchase of two or more properties at the same time—a daunting (and likely unrealistic) prospect for most purchasers!

While some purchasers may argue that they can always fall back on their “subject clauses” (e.g. home inspection, mortgage financing, etc.) as a means of weaselling out of one or more of these contracts on the grounds that they are unable to fulfill these conditions, in practice this can prove challenging. In particular, if the seller is suspicious that the buyer might not be operating in good faith in proceeding with the contract, the seller may have tools at their disposal to take recourse against the buyer.

Needless to say, as a purchaser, the last thing you want to have happen is to be taken to court by the seller for enforcement of a pending contract that you have no interest in proceeding with!

In short, sending forward bids on multiple properties is strictly unadvisable, unless you are in such a position where you would be able to proceed with making multiple home purchases at the same time. There are definitely options at your disposal though for how you can expedite your home purchase bidding process, without exposing yourself to undue liability. Your skilled Realtor should be able to provide you with some strategies to this end.

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

As we saw in an earlier post, seasonality can play a strong role in influencing market conditions. Aside from seasonal patterns, a slew of other factors also can have a bearing on market activity, and by extension, how much of a premium you might be able to sell your home for:

1. Interest rates. While interest rates are currently sitting at historic lows, there is no guarantee that this trend will continue indefinitely. The Bank of Canada has suggested that rates will likely rise in the coming year. If and when that prophecy comes to fruition, consumer affordability will drop, leading to an overall cooling of the real estate market. Selling a home while interests rates are low and buyer demand is high maximizes your chances for a sale at top dollar.

2. Immigration and demographic shifts. Given the relatively low birth rates in Canada, it’s no surprise that much of our demand for real estate is driven by immigration. Sudden upswings in immigration (e.g., in the years leading up to the Hong Kong handover to China in 1997) have historically had profound impacts on our local market. Here at home, it’s postulated that changing population demographics (e.g., as the Baby Boomers age and downsize to smaller and smaller residences), there might be more pressure put on certain facets of the market (e.g., a shift away from single-family homes to townhome/condo living).

3. The economy. When national economic sentiment is positive, the local real estate market tends to fair well, as consumer confidence is generally high at these times. Due to higher “international” involvement in our local real estate market, increasingly economic forecasts from other nations—most notably the United States and China—seems to have an influence on consumer attitudes.

4. Government policy. Temporary tax credits, grants, and deductions are all tools at the government’s disposal for shoring up real estate demand in the short-term. Knowledge about the timing of these programs can potentially save a home seller thousands of dollars.

In conclusion it’s important to note that while trying to time the market looks simple on paper, in practice it’s rarely easily to achieve. The housing market is constantly adjusting and readjusting itself based on buyer demand and seller supply, as influenced by the principal factors listed above. As such, even the most carefully timed home purchase don’t always work out for the best.

When selling a home and making a subsequent repurchase, it’s important to keep in mind that unless you’re willing to sit by the sidelines and speculate, you will be purchasing in much the same market that you likely sold in. As a result, in particular in these cases, trying to time a sale to maximize cash in hand can sometimes be all for naught. As such, most real estate advisors will recommend that when the time feels right to you to go for the plunge. Who knows what surprises tomorrow might hold!

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

This is a question I routinely get asked by both home sellers and buyers. The good news is that generally speaking, the answer to this question is pretty straightforward.

To get things kicked on in addressing this question, a quick vocabulary lesson is in order. The world of real estate, there are essentially two different classes of features to consider:

FIXTURES: objects firmly fixed in place that are considered to be part of the real property or integral to its use or operation

CHATTEL: moveable objects that have not been “annexed” to the property in a legal sense

Why are these terms important? Simply put, if not specified elsewhere, a home must be sold with all fixtures as viewed by the buyer. Any chattels on the premises (even if present when the buyer viewed the property) need not be included with the sale, unless explicitly agreed upon in the Contract of Purchase and Sale. To help simplify things, the standard Contract of Purchase and Sale template for residential property in British Columbia provides specific fields for identifying specific “inclusions” and “exclusions” for a sale.

This sounds all nice and clear-cut, but problems sometimes arise for items that fall into the “grey-zone” zone between fixtures and chattels. Here’s what the strict legal interpretation has been in the past:

A portable/free-standing dishwasher: This is a chattel, because it is not affixed to the property. A built-in dishwasher (e.g., screwed in to the wall or surrounding cabinetry/countertop) conversely, would be identified as a chattel.

Built-in electric light fixtures: The light fixtures would (perhaps obviously) be considered fixtures. Interestingly, the bulbs contained within the fixtures can be construed as chattels that the sellers would be free to remove.

Hanging pictures: Like with the example with the light fixtures, the hooks upon which the pictures were mounted are fixtures, whereas the pictures themselves are chattels. In the unique case where the seller has elected to affix artwork directly to the walls without the use of hooks, technically speaking the pictures become fixtures in that case.

Furnace filters: Although based on the previous examples you might be prone to believe that much like light bulbs a furnace filter should be viewed as a chattel, and free for the seller to remove. However, because the furnace filter is deemed necessary for the regular operation of the furnace (which is itself a fixture), furnace filters are also understood to be fixtures.

Garden sheds: The precedent here indicates that if the shed is securely affixed to the ground, a fence, the house, or another building on the property, it should be regarded as a fixture. However, like the case with the portable dishwasher, if the shed is either entirely freestanding or only modestly secured, it can be treated as a chattel.

In short, the grey area between “fixture” and “chattel” is not always clear. As there is so much potential for confusion, a skilled Realtor will always go the extra mile to ensure determine your needs and then ensure that your interests are protected. At the end of the day, it’s absolutely imperative that what you’re looking to get of a purchase or keep from a sale is well understood by all parties. When in doubt, spell it out!

If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.

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