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.

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.

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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