MORTGAGE BASICS - P. 10 IF YOU’RE MYSTIFIED ABOUT MORTGAGE SPEAK YOU’RE NOT ALONE
HOME STAGING - P. 17 SUCCESSFUL HOME STAGING ENABLES BUYERS TO SEE THEMSELVES IN YOUR HOME
RETURN ON RENOVATIONS - P. 19 THE APPRAISAL INSTITUTE OF CANADA TIPS TO CHOOSING “SMART” HOME RENOVATIONS
REALTOR®
CHECKLIST PULLOUT
A BUYER’S CHECKLIST FOR ALL OF YOUR WANTS AND NEEDS FOR YOUR NEW HOME
P. 11
REA
REALTOR速
Letter from your REALTOR速.................................................... 4
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As Your REALTOR速................................................................... 5 Agency................................................................................... 6 BUYING
TA BLE O F CO N TEN TS
Table of Contents
Introduction...................................................................... 7 Process.............................................................................. 8 Viewing an Open House with Open Eyes..................... 9
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PROPERTY TRANSFER TAX
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LISTING Home Staging.................................................................. 17 Pricing - Top 5 Mistakes.................................................... 18 Return on Renovations.................................................... 19 LIVING Strata Living...................................................................... 21 Purchase Plus Improvements.......................................... 22 MARKETPLACE & REFERENCES
23 www.BrandonLarson.ca
BRANDON LARSON | BUYING & LISTING GUIDE
CHECKLIST PULLOUT
HOME STAGING
Mortgage Basics.............................................................. 10
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L ET T E R FR O M Y O U R REA LTO R
Anxiety. Stress. Frustration.
H
ave you previously purchased or sold property? Are you a first time homebuyer? All to often, individuals experience negative feelings at some point in the process of purchasing or selling a home.
The good news is that real estate transactions can be completed without any anxiety, stress or frustration.
Suite 101 - 2264 Elgin Avenue Port Coquitlam, BC V3C 2B2
The different between individuals that experience anxiety, stress and frustration versus those that don’t is often their selection in the real estate professional they choose to work with. West Real Estate Services
I have created this guide with some very specific goals to assist you with your upcoming real estate transaction, hopefully making the process as smooth as possible. The content includes: • Providing you with an overview of the buying/selling process • Assisting you in building a team of professionals • Keeping you up to date with various programs and resources available
BRANDON LARSON | BUYING & LISTING GUIDE
It is also very important to ensure that you have a team of professionals that are working for you. As your REALTOR®, I have a list of individuals for you to select from in order to ensure that your purchase and/or sale progresses as smoothly as possible.
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Whether buying or selling, it is important to alleviate the stress that can come with a real estate transaction. My training, experience and endless resources will ensure that your next real estate transaction is conducted professionally. Through exceptional customer service and attention to detail, I look to build strong, long lasting relationships with all of my clients. I hope that you find the contents of this guide useful and I look forward to working with you in the near future. Please feel free to contact me directly with any questions that you might have regarding the contents of this guide or any other real estate related matter.o
-Brandon Disclaimers: This guide is not intent to solicit individuals currently engaged in an agency relationship or solicit a property currently listed for sale. The contents of this guide are intended for those purchasing and selling a property in the Province of British Columbia. Information contained in this guide is deemed current at the time of publication. Brandon Larson is not responsible for errors or omissions that this guide may contain. The contents of this guide are for informational purposes only and are not intended to replace advice from a real estate or legal professional.
www.BrandonLarson.ca
BU Y I N G
E
veryone wants to ensure that they have made the right decision in their choice
of a REALTOR®, please know that I subscribe to a strict code of ethics and am committed to treat all parties to a transaction ethically and honestly.
Success is not always measured just by sales. More importantly, it is also about relationship building. Appreciating the sometimes small but special needs of my clients and acting upon them in a more than satisfactory manner is always very rewarding to me. For the majority of Canadians, their homes are their largest investment, so minimizing one’s risk is not only prudent – it is essential. As your real estate agent, I will: • Act as a buffer between you and other third parties • Negotiate the transaction • Manage all necessary paperwork • Identify unnoticed features of a home • Identify charges on titles and caveats on the home, which may disrupt your purchase or sale
“People do business with people because they choose to, not because they have to. We can always f ind others doing the same thing or selling the same product, it’s the personal connection that makes the difference” -Unknown To date, the bulk of my business has been built on the basis of referral. I appreciate all of my clients and the referrals that they provide me with, it is my feeling that the biggest compliment a professional can receive is a referral from a past client, friend or family member. Therefore, my goal is to provide you with such exceptional service that you will feel comfortable and confident to refer me to your friends, family and co-workers. I will work hard to build this trust and look forward to working with you.o
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BRANDON LARSON | BUYING & LISTING GUIDE
When choosing a REALTOR®, it is important to select an individual that you can trust. You will also want someone that can explain in detail, specific topics that are important to you and your real estate transaction.
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BU Y I N G
Understanding the Agency Relationship
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EALTORS® work within a legal relationship called agency. The agency relationship is established through a contract between you, the client, and your agent, the company under which the REALTOR® is licensed. Most REALTORS® use a blue brochure titled Working with a Real Estate Agent to disclose the nature of the agency relationship with their client.
A REALTOR® can act for a seller or a buyer, or to a limited degree, both. Whomever they represent, REALTORS® have a legal obligation to uphold the integrity of their clients, while protecting and promoting their interests. A REALTOR® can also provide real estate services to parties with whom the REALTOR® does not have an agency relationship. Typically called a customer relationship, REALTORS® can do the following:
BRANDON LARSON | BUYING & LISTING GUIDE
SELLER’S AGENT
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• Explain real estate terms, practices and forms • Assist in screening or viewing properties • Prepare and present offers or counter-offers at the customer’s direction • Inform customer about lenders and their policies • Identify and estimate costs involved in a transaction A customer relationship does not include agency duties of loyalty, disclosure and confidentiality.
BUYER’S AGENT
DUAL AGENCY
• For your REALTOR® to list your property for sale on MLS®, a listing agreement must be completed.
• The contract of purchase and sale is initiated when an offer is made by the buyer to purchase the seller’s property.
• Dual agency is created when an agent represents both the buyer and seller in a single transaction.
• Signing this agreement with you commits your REALTOR® to uphold their obligations.
• The contract outlines the terms and conditions of the offer, such as offer price and subject conditions.
• The listing agreement also states the compensation amount the seller will pay the REALTOR®.
• The seller may reject the offer or make a counter offer.
• This can happen if a REALTOR® who is representing a buyer, sells one of their own listings to that buyer.
Remember: Always read all contracts and disclosure forms before signing. If you have questions about agency relationships contact your REALTOR®.
• Once all terms have been accepted and both seller and buyer have signed the contract, each party is legally bound to fulfill the conditions of the contract.
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• A dual agent must be impartial to both buyer and seller and fully disclose all information relating to the transaction. • A REALTOR® can be a dual agent only if both seller and buyer agree.
his is one of my favourite quotes with regards to purchasing real estate. The simple fact is that very few people have the luxury of putting together a wish list and finding a new home that meets every single wish on the list.
Buying a home, unless you are building a custom home on the lot of your choice, is all about compromise. It’s important to meet with your REALTOR® prior to venturing out and looking for a home and let them know exactly what your wants and needs are for your new home. For many, it will boil down to price. For some, there are an absolute minimum number of bedrooms or bathrooms. For others, it’s all about living in their ideal neighbourhood. Once you have discussed with your REALTOR® what is most important to you, the next step is to talk about what you might be willing to compromise on. If your wish list states that you would like four bedrooms, are you willing to buy a house with three bedrooms in order to move into your preferred neighbourhood? If your wish list states that you
would like a two-car garage, are you willing to buy a house with a single car garage in order to obtain an extra bedroom? Are you willing to purchase a house that needs a little TLC in order to ensure that you stay within your budget? It’s only after you have created your wish list and then relayed to your REALTOR® what some of your compromises would be are you ready to head out and start house hunting! The following pages in the buying section of this guide will help you make the critical decisions necessary to ensure that you are ELIMINATING houses that absolutely don’t meet any of your requirements and then SELECTING from the remaining houses available that meet as many of your wants and needs as possible.o www.BrandonLarson.ca
BRANDON LARSON | BUYING & LISTING GUIDE
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BU Y I N G
“Buying isn’t a process of SELECTION, it’s a process of ELIMINATION”
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BU Y I N G
> Lawyer/Notary Fees
> Land Title Registration
The Typical Buying Process
> Mortgage Costs
Arrange Financing/ Pre-Approval/ Down Payment
> Insurance
> Property Transfer Tax > GST
View Properties
Compare Conveyance Lawyer/Notary Prices
Choose A Property Inspector
Choose a Property
BRANDON LARSON | BUYING & LISTING GUIDE
“Choosing the right representatives from start to finish is key to any smooth and worry free real estate transaction”
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There are many important contacts to have in the buying process. Ensuring that the transaction goes as smoothly as possible is my ultimate goal. Below is a list of some of the key players that will be involved in your purchase. I can work with you to
Offer on Property/ Negotiate
Remove Subject Clauses arrange getting in touch and scheduling to meet these individuals. I can also provide a list of selections so that the choice is yours! • REALTOR ® • Mortgage Brokers and Lenders • Property (House) Inspectors • Builders/Contractors • Insurance Brokers • Appraisers • Lawyers/Notaries
www.BrandonLarson.ca
(if any)
Obtain Fire/ Liability Insurance
Complete Transaction
Obtain Key/Take Possession
BU Y I N G
Open House Open Eyes
R
emaining objective can be a difficult task when viewing an open house. It is easy to fall in love with a home’s appearance, blind to problems that may make it unsuitable. While aesthetics can be an important consideration, it is necessary to look beyond window dressing. Although a qualified home inspector should be hired before purchasing a home, there are areas that consumers can examine on their own. Below is a list of items that a buyer can look for while touring open houses, potentially eliminating home from their consideration.
WATER LEAKS Check ceilings and drywall for stains, bulges and other signs of water damage. Water that works its way inside through a leaky roof or a cracked foundation can rot wood, create mildew and mold, destroy possessions and can be expensive to repair. DOORS & WINDOWS Check that doors and windows fit snugly in their jambs and operate smoothly. Look for flaked paint and loose caulking. If the wood around windows and doors is not protected from moisture, it can rot away. Feel for drafts in these areas too. STRUCTURAL Although this is definitely an area where you want the services of a qualified home inspector, you can get an idea about possible structural problems if you see deep cracks in the foundations or loose mortar and bricks.
DOES IT WORK? Test lights, faucets, the heater, air conditioning, major appliances (that are to be included with the home) - even flush the toilets to ensure everything is working as it should. POOR DRAINAGE On a wet day walk around the yard and look for areas where water collects. This can be an especially bad sign if there are soggy areas near the home’s foundation. GROUT & CAULKING If the grout and caulking around bathroom and kitchen tiles is loose and crumbly, there is a good chance that water is finding its way into the wall or under the floor. MISCELLANEOUS CONCERNS Naturally, one the most important factors will be determining if the house suits your family’s needs. If you do not want to replace all of your furniture, make sure it will fit into the rooms of the new house. This is difficult to do by eye, so be sure to bring a measuring tape. Also, take note of storage space. If you are moving from a home with large closets and a shed, make sure your new house is able to store an equivalent amount of belongings.o
FLOORS As you walk across the floors be aware of spongy (soft or springy) sections Excessive squeaking and uneven, bumpy floors may also be indicative of expensive forthcoming repairs. www.BrandonLarson.ca
BRANDON LARSON | BUYING & LISTING GUIDE
GENERAL UPKEEP Much can be surmised from the general state of the home. Is the home clean? Are lawns left uncut? Are the walls chipped and in need of paint? If smaller chores have been ignored it may be an indication of a broader disregard for home maintenance.
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BU Y I N G Amortization. Fixed rate. Variable rate. High-ratio. Principal. If you’re mystified by mortgage-speak, you’re not alone. Here’s a crash course in mortgage basics to help you make smart decisions about one of the biggest investments you’ll ever make. CHOOSE A TERM THAT WORKS FOR YOU. A term is a period of time (from 6 months to 10+ years) during which you pay your mortgage at a specified interest rate. To figure out what term is right for you, decide how comfortable you are with the volatility of the market and how important a stable mortgage payment is to your budget. LONG TERM: If interest rates are low and you’re afraid they’ll go up and you may want to lock in at a low rate and know exactly how much you’ll be paying every month. Common longer terms are often 5, 7 or 10 years.
BRANDON LARSON | BUYING & LISTING GUIDE
SHORT TERM: If interest rates look like they’re falling, this may be a better bet. If you’re comfortable with payments that may fluctuate somewhat, your best bet is a shorter-term mortgage (i.e. a 6-month variable rate mortgage) that lets you take advantage of low rates, but also has the flexibility of allowing you to lock in and convert to a longer-term mortgage whenever you want.
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“If you’re mystified by mortgagespeak, you’re not alone.”
DECIDE ON AN AMORTIZATION PERIOD. The amortization is the number of years (15, 20, 25) it would take to pay back the loan based on a fixed payment amount. The longer the amortization, the more interest you’ll pay. You can shorten your amortization by increasing your payments, paying lump sums towards the principal, or renewing your loan at a lower rate, while keeping the same/current payment amount. DECIDE ON A FIXED OR VARIABLE RATE. A fixed-rate mortgage means you pay a set amount every month for the term of your loan. Whether posted interest rates rise or fall, your payments won’t change. With a variablerate mortgage, your interest rate fluctuates with your lender’s prime lending rate. It offers more flexibility, but also more risk. Typically, you pay a set amount every month, but when rates fall, more cash goes to principal, which reduces the interest you’ll have to pay in the long term. If rates go up, however, your set payment may not be enough to cover interest and principal, so you could end up having to pay more. www.BrandonLarson.ca
CHOOSE A CLOSED VS. OPEN MORTGAGE. In an open mortgage, you can repay your loan any time without penalty. So, if you sell another property or come into some extra money, you can pay down your principal whenever you want. Interest rates for open mortgages tend to be higher than for closed, and terms are typically shorter. A closed mortgage is less flexible. If you decide to pay off a big chunk of your principal, you could incur a penalty. However, even closed mortgages have pretty generous prepayment options (sometimes up to 20% of the principal per year). DECIDE HOW OFTEN YOU’LL MAKE PAYMENTS. You can pay monthly, bi-weekly or weekly. Here’s the difference: with monthly payments, you make 12 a year. With bi-weekly payments, it’s 26. That’s the equivalent of 13 payments a year instead of 12. You probably won’t notice much of a difference in your cash flow, but you’ll pay off your mortgage faster, and save yourself thousands in interest. WILL YOU GET A HIGH-RATIO OR CONVENTIONAL MORTGAGE? That depends on the size of your down payment. A conventional mortgage is a loan that covers up to 75% of the purchase price, and doesn’t need to be insured against default. A high-ratio mortgage is anything over 75%, and must be insured by the Canada Mortgage and Housing Corporation (CMHC) or GE Capital. You can add your insurance premium (a percentage of your loan amount) to your mortgage or pay it in full on closing. GET PRE-APPROVED/PRE-QUALIFIED. Find out how much you’re eligible to borrow before you start looking. You’ll know exactly how much you can afford, and you’ll be guaranteed the interest rate that’s available at the time of your pre-approval for 60-120 days. If rates go up, you won’t have to worry about paying more, and if they go down, you get the lower rate. It’s win-win, free and there’s never an obligation to go with that lender. SHOP SMART. Now that you’re armed with some mortgage knowledge, you’ll be able to choose a loan that best meets your needs. If you need more info, most lenders have helpful information on their websites, or you can always ask your REALTOR® for help understanding the ins and outs of mortgages.o
HAPPY MORTGAGE HUNTING! Trademarks owned or controlled by The Canadian Real Estate Association. Used under licence.
The next four pages can be removed from this magazine in order for you to complete the Buyers Checklist when purchasing your next home. MORTGAGES Are you pre-qualified? Employment letter required? Interest rate protected for 60, 90 or 120 days? Liabilities and assets tallied? Do you need mortgage loan insurance ie. CMHC? Compared interest rates, pre-payment privileges? Compared payout penalties (if any)? Do you want mortgage life insurance? DOWN PAYMENT Are your monies readily accessible? Are your monies a gif t? If so, you may need to provide a letter verif ying this from the donor.
New immigrants should verif y down payment required. DEPOSIT You will need to obtain a bank draf t once you have an accepted offer on a propert y. Realize that your deposit becomes part of your down payment.
REALTOR速
Verif y with your REALTOR速 as to how much money is required. HOME INSPECTORS Know what is included with an inspection. Ask your REALTOR速 to recommend several. Check their credentials. Ask for referrals. A fee will be payable immediately upon inspection. BC Inspectors are licensed and are required to carry Errors & Omission Insurance as well as General Liabilit y Insurance in order to obtain a license.
West Real Estate Services
Suite 101 - 2264 Elgin Avenue Port Coquitlam, BC V3C 2B2
604.765.9611 brandonlarson@royallepage.ca www.BrandonLarson.ca
Do you qualif y to use your RRSP monies?
CH ECKLI S T P U LLO U T
CHECKLIST
HOME INSPECTORS (CONTINUED) Get an additional specialist if you suspect the home may have a problem ie. Insect Specialist, Pool Specialist, Roof Specialist, etc. NEW HOMES GST will be payable. Know about all warranties, when they expire, etc. Know that the estimated completion day can vary from the Purchase Contract. HOME INSURANCE Most lenders will require insurance.
Tenant liabilit y insurance should be obtained should you rent out a portion of the house. Condominiums need only to be insured for contents and liabilit y (under most scenarios). LAWYERS/NOTARIES PUBLIC A fee plus GST will be charged on completion day. Shop and compare pricing.
The Buyer’s Lawyer orders the Sur vey should one be necessary. EXTRA COSTS Besides the down payment, have extra monies set aside for propert y transfer tax, legal fees, sur vey, appraisal fees, propert y tax adjustment, etc. Ask your REALTOR® for an itemized breakdown. CONDOMINIUMS/TOWNHOUSES Know the difference bet ween a strata, leasehold, co-op, etc. Know what the contingency reser ve fund is before you offer on the propert y. If it is low ask why. Make sure you are in receipt of all necessary documentation and have a professional handy in-case you don’t understand their content. Know if the parking stall(s) and storage locker are part of the condominium unit or part of the common propert y. They may even be a separate strata lot.
West Real Estate Services
Suite 101 - 2264 Elgin Avenue Port Coquitlam, BC V3C 2B2
604.765.9611 brandonlarson@royallepage.ca www.BrandonLarson.ca
Ask your REALTOR® or Mortgage Broker to recommend several.
REALTOR®
CH ECKLI S T P U LLO U T
CHECKLIST
Please fill in the blanks below. I will do my best to fulfill your requirements. However, please realize that the price range you have indicated here, will ultimately dictate the home you will be able to buy. MAXIMUM PRICE $_____________________________________ PREFERRED AREAS IN ORDER OF PREFERENCE (LIST TWO)
______________________________________ ____________________________________________ PREFERRED SUB-AREAS IN ORDER OF PREFERENCE (LIST TWO) ______________________________________ ____________________________________________ NUMBER OF BEDROOMS - Upstairs ___________________
- Downstairs _________________
STYLE OF HOME (Please Circle)
Contemporary Tudor, Colonial
2 Level / 3 Level / Basement
Other, please specif y ______________
NUMBER OF BATHROOMS REQUIRED _______________ No REALTOR速
MASTER BEDROOM ENSUITE IMPORTANT? Yes
AGE RANGE _________________________________ DESIRED SQUARE FOOTAGE ________________________ LOT SIZE (Please Circle)
Large
Small
Easy Care
Lawn & Garden
Fenced Suite 101 - 2264 Elgin Avenue Port Coquitlam, BC V3C 2B2
Flat Sloped Corner Lot Other: __________________ West Real Estate Services
604.765.9611 brandonlarson@royallepage.ca www.BrandonLarson.ca
Rancher Character, Old-timer
CH ECKLI S T P U LLO U T
WISH LIST
Family room or recreation room desirable? ________________________________________________ Preferred heating? (Please Circle) Gas
Hot Water
Number of covered parking stalls (Please Circle) Workshop or garage important?
Yes
What time frame do you wish to move?
1
Electric 2
3
4
No 1 month
2 months
3 months
___________
Updated or handyman special? _______________________________ Income suite desirable? ______________________________________ Pool / Hot Tub/ Air Conditioning important? _______________________________________________ Sundeck / Patio important? ____________________________________________________________ Do you have any pets?
Dog # _________
Are schools important?
Yes
No
Cat # ________
Other __________________
If yes, please specif y: _____________________________
What is the most important to you in a home? Please list three items: ____________________________ _________________________ ___________________________
When is the best time to look?
Evening
Day-time
Weekend
If I found the right home for you today, is there any reason that could keep you from buying it? _____________________________________________________________________ _____________________________________________________________________ Does anyone else have to approve of your purchase? ___________________________ Are you working with another REALTOR®? (Please Circle)
Yes
No
How long have you been looking for a home? _________________________________ Have you seen anything you like? Why didn’t you buy it? _______________________ _____________________________________________________________________ Additional requirements? Special School, Barrier Free, etc.? ____________________ _____________________________________________________________________ West Real Estate Services
Suite 101 - 2264 Elgin Avenue Port Coquitlam, BC V3C 2B2
604.765.9611 brandonlarson@royallepage.ca www.BrandonLarson.ca
OTHER DETAILS
REALTOR®
CH ECKLI S T P U LLO U T
WISH LIST
BU Y I N G roperty Transfer Tax is a land registration tax. It must be paid when an application for a taxable transaction is made at any Land Title Office in British Columbia to register changes to a certificate of title. Property Transfer Tax is payable on the fair market value of the property being transferred.
The Property Transfer Tax (PTT) was introduced by the BC government in 1987. At the time it was called the Property Purchase Tax. It was meant to be a luxury tax, where only 5% of homes would have to pay to pay the 2% portion of the tax (for homes priced over $200,000). The Property Transfer Tax (PTT) as it is known today is calculated at 1% on the first $200,000 and 2% on the remaining fair market value of a home. Fair market value is the price that would be paid by a willing purchaser to a willing seller in the open market on the date of registration. An open market is where the property is offered for sale, so that anyone likely to be interested in purchasing it may make an offer. For example, the seller lists the property on the Multiple Listing Service®. In most open market transactions, the purchase price is the fair market value, as long as the transfer is registered within a few months after the sales contract is signed. In other instances, such as where no money changes hands or the transfer did not take place in the open market, the fair market value must be determined by other means, such as an independent
appraisal or by reference to the most relevant BC Assessment value. Most purchasers of pre-sold strata units will pay the PTT on the total consideration paid for the unit, rather than on its fair market value as of the date of registration at the land title office. The total consideration is the total amount paid to acquire the property – this includes money paid for upgrades or additions, or any other premium paid for assignment of a written agreement. If the original purchaser(s) of a pre-sold strata unit sells or assigns their right to purchase the unit to another person before the strata plan is deposited at the land title office, the PTT due is calculated on the total consideration paid by the person who registers the transfer. Total consideration paid includes any additional amounts paid to obtain the right to purchase the unit from that person. If the transfer of a strata unit is a non-arm’s length transaction, the purchaser must pay tax based on the total consideration that would have been paid for the unit if the transaction has been between arm’s length parties in the open market. Non-arm’s length transaction is
one that does not take place in the open market, such as an assignment to a person who is vertically related to the original buyer (including parent, grandparent, child, not siblings), or an assignment from the purchaser to their company. By contrast, an arm’s length transaction does take place in the open market. In all cases, the first person to register the transfer at the land title office, after the developer had deposited a strata plan at the land title office, is the person who is subject to the tax. There are some exemptions available that may apply to exempt all, or a portion of, the transfer from the tax. While a complete list of exemptions is available on the British Columbia Ministry of Finance website, below I am going to talk specifically about the First Time Home Buyers Program. The First Time Home Buyers’ (FTHB) Program is a common exemption that individuals purchasing residential property in BC need to understand. In 2013, there were 19,061 FTHB exemption claims, according to the BC Ministry of Finance. >
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BRANDON LARSON | BUYING & LISTING GUIDE
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Courtesy of the Real Estate Board of Greater Vancouver - March 2014
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BU Y I N G
•
HE BUYER(S) MUST MEET THESE T QUALIFICATIONS:
must be a Canadian citizen, or a permanent resident as determined by Immigration Canada; • must have lived in BC for 12 consecutive months immediately before the date you register the property, or must have filed two income tax returns as a BC resident during the six years before the date you register the property; • must never have owned an interest in a principal residence anywhere in the world at any time; and • must never have received a first time buyers’ exemption or refund.
BRANDON LARSON | BUYING & LISTING GUIDE
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•
•
If the buyer purchases land, they must build and move into their new home within one year of the date they register title to the land. After the buyer moves into the home, they must continue to use the property as a principal residence for one year. They may retain part of the exemption if they move out before the end of the first year. The BC Minister of Finance will send the buyer a letter at the end of the first year they own the property to confirm that they meet the requirements as explained above.
WO BUYERS OF A HOME - ONE OF T WHOM HAS PREVIOUSLY CLAIMED A FTHB EXEMPTION AND ONE HAS NOT
HE PROPERTY BEING PURCHASED T QUALIFIES FOR A FULL EXEMPTION IF:
If one of the home buyers qualifies as a first time buyer under the criteria, then that buyer could receive a FTHB exemption based on whatever percentage interest they are going on title for. For example, a couple buying a home and each is going on title equally (50-50). One buyer has never claimed the FTHB exemption, so they could receive 50% of the FTHB exemption amount that would have been available if both buyers had qualified as first time home buyers under the criteria. To view the table of exemption amounts with a 50% FTHB exemption please visit the British Columbia Ministry of Finance website.
HE PROPERTY BEING PURCHASED T QUALIFIES FOR A PARTIAL EXEMPTION IF:
P ENALTY FOR FALSE DECLARATION
• purchasing an existing home, the fair market value of the property is not more than $475,000; • purchasing land and building a home, the fair market value of the land as of the date you register the property, plus the cost to build the home is not more than $475,000; • the land is 0.5 hectares (1.24 acres) or smaller; and • the property will only be used as a principal residence.
• purchasing an existing home, the fair market value of the property is between $475,000 and up to $500,000; • purchasing land and building a home, the fair market value of the land as of the date you register the property, plus the cost to build the home is between $475,000 and up to $500,000; • the land is larger than 0.5 hectares (only 0.5 hectares of land are eligible); or • a portion of the improvements on the land is used for commercial purposes or there is a separate dwelling on the land (only the principal residence portion is eligible).
OW TO APPLY FOR THE FTHB H EXEMPTION?
• The buyer applies for the exemption when the property is registered at the land titles office. • Generally, the lawyer or notary public registers the property and applies for an exemption on the buyer’s behalf. • The land title office sends the application to the Ministry of Finance to verify the buyer’s eligibility. • If the buyer did not apply for the exemption at the time the property is registered at the land title office, they can apply for a refund of the PTT within 18 months of the date of the registration of the property.
•
•
EQUIREMENTS TO KEEP FTHB R EXEMPTION
If the buyer purchases an existing home, they must move into the home within 92 days of the date they register title to the property. www.BrandonLarson.ca
If a buyer claims an exemption or refund, they may be charged an amount equal to double the tax (double the tax owed plus a penalty equal to the exemption or refund claimed) if they falsely declare: • that they have never owned an interest in a principal residence anywhere in the world at any time; and/or • that they have never received a BC first time home buyers’ exemption or refund. For more information regarding Property Transfer Tax in BC please contact your REALTOR® or mortgage professional.o
PARTIAL EXEMPTION CALCULATION In order to calculate a partial FTHB exemption for a property priced over $475,000 and up to $500,000, use the following calculation:
PTT x (QV + $25,000 - FMV) = Exemption Value $25,000 >> Property Transfer Tax (PTT) = 1% on first $200,000 and 2% on remainder (determine the PTT on the purchase price) >> Qualifying Value (QV) = $475,000 >> Fair Market Value (FVM) = Purchase Price >> Exemption Value = Exemption Amount (reduction of what is owning for PTT)
LI S TI N G homes sell faster. Why? Successful home staging enables a buyer to see themselves in your home, not how you’re currently occupying it. Professional staging consultants accomplish this by following some simple guidelines.
Divide and conquer
Take a good look around your home. Now imagine it with only half of the belongings. Some consultants even aim to remove at least two-thirds of items from a home to allow a room’s features (including size, flooring, and architectural details) to come forward so that buyers aren’t focusing on your collection of ceramic roosters instead.
Follow a witness protection program
Put your home under a “witness protection program” and remove anything that identifies who owns the property. That way a prospective buyer doesn’t have to mentally clear you out before they can imagine themselves in your home. At the top of the list are the family photos on the mantelpiece and notes to each other stuck on the fridge. Prospective buyers don’t need to know that Jimmy won the soccer tournament or that you’re out of milk.
Let there be natural light
Open your doors and windows, clean them and don’t block them! Just because you haven’t used that side door in years doesn’t mean that you should ignore it – keeping it hidden will make buyers suspect that there’s something wrong with it. (If there is, fix it.) Keeping windows clean and the curtains tied back will let more natural light into your home, which is a big plus for prospective buyers.
Out, out, darn Spot
While few can resist the unconditional love of a pet, many prospective buyers would prefer not to see pet hairs or smell evidence of Fifi or Fido. If possible, try to find a place for your pet to stay for a few days and have your carpets steam-cleaned to eliminate any lingering odors. Or try to have your pet reign in one room or on one floor and give the area a thorough cleaning prior to an open house. Remember also to tuck pet beds, litter boxes and food dishes out of the way.
Peek behind closed doors
Take a good look at your closets and cupboards. What kind of impression would they give a prospective buyer? Are they bursting at the seams or do they provide ample room for all
your stuff ? Take a minute to organize your items, wipe down shelves and air out your cupboards. Clearing out the clutter will work in your favour; interested buyers will always take a peek, even if they don’t admit to doing it.
Follow your nose
People use all of their senses when they evaluate a property, so remember to keep their noses happy. Avoid preparing aromatic foods using garlic, onions or other fragrant ingredients two days before your open house. Tuck fabric softener sheets in areas where shoes and sporting equipment is stored. Need to dispel a smell in a jiffy? Open up all of the interior doors in your home and cook up a batch of ready-to-bake chocolate chip cookies. Not only do they smell delish, you can leave them out on a plate for people to nibble on as they consider your property.
One focal point
Home staging professionals know that the best way to showcase a room is to choose one focal point for it. It could be a window, fireplace or distinctive piece of furniture—the goal is for it to draw the eye in and then around the room. This is why the elimination of clutter and excess furniture is key; you don’t want potential buyers distracted when they are inspecting the floors, molding and overall size and shape of the room. This is when they are picturing how their belongings will work in the space.
Minimize the negative
Stand at the entrance to a room. What is your eye drawn to first? If it’s something you prefer buyers not focus on, like a stucco ceiling or sponge-painting gone wild, your best defence is an eye-catching accessory near the front of the room. It’s done on home-staging shows all the time—they use a bowl of green apples or a vase of fresh flowers to successfully take eyes away from an offending feature for that pivotal moment when a first impression is made. So there you have it. By investing some time into home staging, you can ensure that your property is set to sell.o
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T
here are thousands of home-staging consultants in business for good reason: staged
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LI S TI N G BRANDON LARSON | BUYING & LISTING GUIDE
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Avoid The Five Most Expensive Mistakes People Make When They Sell A Home...
BASING THEIR ASKING PRICE ON NEEDS OR EMOTION RATHER THAN MARKET VALUE.
CHOOSING THE WRONG AGENT OR CHOOSING THEM FOR THE WRONG REASONS.
Many times, people make their pricing decisions based on how much they paid for or invested into their home. This can be an expensive mistake. Overpriced homes take longer to sell and eventually net the seller less money. Consult with a professional real estate agent. They can assist you in pricing your home correctly from the beginning.
Many homeowners list their home with the agent who tells them the highest price. Or they list with the agent who will charge the least commission. You need to choose the agent with the best marketing plan and track record to sell your home.
FAILING TO “SHOWCASE” THEIR HOME.
NOT KNOWING ALL OF THEIR LEGAL RIGHTS AND OBLIGATIONS.
First impressions are the most important. Experience shows that for every $100 in repairs that your home needs, a buyer will deduct $300 to $500 from their offer. Thoroughly clean and prepare your home before you put it on the market if you want top dollar. TRYING TO SELL THEIR HOUSE WHEN BUYERS COME TO SEE IT. One of the biggest mistakes enthusiastic home sellers make is to follow buyers around and try to SELL them on the property. This can have a negative effect on the buyers. The best thing is to stay out of the way and let people look at their own pace, they’ll get a better feel for the property and whether the house is for them. www.BrandonLarson.ca
Real estate law is complex. The contract you sign when selling your home is legally binding. Small items that are neglected in a contract can wind up costing you thousands of dollars. You need to consult a knowledgeable professional who understands the ins and outs of a real estate transaction.o
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BRANDON LARSON | BUYING & LISTING GUIDE
LI S TI N G
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LI S TI N G
Strata
A “condominium” refers to a form of legal ownership, as opposed to a style of construction.
Living
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Condominium Living Strata C Princi orporation s’s pal Du ties: 1. The Duty to Manag e 2. The Duty to Repair & Main 3. The tain Duty to Insure 4. The Duty to Enforce Bylaws 5. The & Rules Duty to Keep R ecords
• • • • •
High-rise Residential Buildings Low-rise Residential Buildings Townhouse or Row House Complexes Stacked Townhouses Duplexes (one unit over another) or Side-by-Side • Triplexes • Single-Detached Houses • Vacant Land Upon Which Owners May Build *Courtesy of Canada Mortgage and Housing Corporation.
1. 2. 3. 4. 5. 6. 7. 8. 9.
What bylaws and restrictions govern the property? Are there any grand fathered clauses? What is the date of the last depreciation report? Is a copy available? Have engineering reports been done on the strata and are reports available? How much is in the contingency fund reserve fund? How are funds invested? How much are the monthly strata fees and what do they cover, for example: common area maintenance, recreational facilities, garbage collection, snow removal, hot water, heat, cable? What repairs have been made in the last decade, for example: major plumbing, roof, windows? Have there been special assessments in the past five years? What did they cover and what was the cost per unit? What percentage of units are owner occupied? What percentage are rental units? Is there pending litigation, for example, for leaky condominium repairs?
BENEFITS OF STRATA LIVING o o o o o o
Governed by the Strata Property Act Voting Rights Access to Amenities Privacy & Security - Apartments & Gated Communities Automatic Savings - Contingency Reserve Fund Low Day-to-Day Maintenance - Landscaping & Snow Removal www.BrandonLarson.ca
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9 QUESTIONS TO ASK A STRATA CORPORATION
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LI V I N G
Purchase Plus Improvements
BRANDON LARSON | BUYING & LISTING GUIDE
Location. Location. Location.
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Ideal for consumers looking to purchase a home that has great potential but needs a little TLC. The Purchase Plus Improvements program, available through Genworth Canada, allows you to make improvements immediately after taking possession of your new home and have the costs rolled into one easy-to-manage mortgage. In many cases, as little as 5% of the purchase price plus the renovation cost is all that is required for your down payment.
This is the mantra of nearly every real estate professional. We constantly preach that a homebuyer should narrow down their search to the neighbourhood that they would like to live in and then find a suitable home within that general area. This can be a little frustrating if you, the homebuyer, find that your budget might not permit you in live in your ideal neighbourhood. Further adding to frustration is finally finding a home within your price Both the CMHC website and the Genworth range, only to realize that it is in need of renovations Canada website offer great resources for those in order to bring it up to your personal standards. wanting to learn more about the programs. There is good news though!
Make sure you talk to your mortgage professional in order to find out if you (and the property your are Both the Canada Mortgage and Housing considering) qualify.o Corporation (CMHC) and Genworth Canada offer similar home renovation programs that enable Content obtained from www.cmhc-schl.gc.ca, www.genworth. ca & www.homeownership.ca. Information above is for homebuyers to purchase a home and include the cost information purposes only and a mortgage professional should of renovations that improve the value of the home in be contacted regarding availability and qualification for the programs. their financing.
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Senior Financial Planner
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TD Wealth Private Investment Advice Pacific Centre PO Box 10022 10th Floor - 700 West Georgia Street Vancouver, British Columbia V7Y 1A2 T 604 482 5105 TF 1 855 668 2122 F 604 482 8427 warren.schneider@td.com
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Nick Burzese AMP Mortgage Planner
The Condominium Home Owners Association of BC www.choa.bc.ca Canada Mortgage and Housing Corporation www.cmhc-schl.gc.ca Genworth Canada www.genworth.ca Canadian Association of Home and Property Inspectors BC www.cahpi.bc.ca Canadian Association of Accredited Mortgage Professionals www.caamp.org www.BrandonLarson.ca
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401-1311 Howe Street Vancouver BC V6Z 2P3 C 604 351 6424 F 778 800 2365 nick.burzese@mtgarc.ca http://www.nickburzese.com
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