Vancouver House Finders Blog

Keep your finger on the pulse of the Metro Vancouver Real Estate market with the Vancouver House Finders blog.

 

We cover real estate trends in all of these areas:

 

 

 

 

 

 

 

 

May 30, 2016

MORTGAGE BROKER VS. BANK SPECIALIST - WHAT YOU NEED TO KNOW

“According to a 2011 survey by the Canada Mortgage & Housing Corporation, 81 per cent of recent buyers, at some point, will rely on a mortgage professional (either a mortgage lender or mortgage broker) for advice and consultation.”  

- Canadian Living Magazine   

Do you know the difference between a mortgage broker and a bank mortgage specialist? While the difference may appear subtle on the surface, there are major discrepancies between the two, which could seriously impact your mortgage rate and application process.  

The crucial difference between a mortgage broker and a bank mortgage specialist is also the simplest: a mortgage broker works for you, and a bank mortgage specialist works for the bank. This defining characteristic could save you substantial amounts of money and be the difference between getting the right deal for you, or the deal that works best for the bank.  

Bank specialists are employed by a company, therefore looking out for the bank’s best interest, and are more concerned with bottom line figures, quarterly reports and turning profit. Mortgage brokers are employed individually by each client, meaning their sole purpose is to make sure clients are happy with the entire mortgage brokering process.  

Mortgage brokers are not bound by one bank’s rates or offers. They have contracts with multiple lenders that include The Major Banks, but also alternatives a normal homebuyer might not have access to, or even know exists. With a bank specialist your options are limited, with a mortgage broker the options are plentiful.  

The negotiation process for obtaining a mortgage can be complicated and at times confusing. A mortgage broker’s job is to negotiate the best rate for you on your behalf, equipped with information that helps them find the perfect deal suited to your needs. When it comes to a bank mortgage specialist, you are forced to negotiate with the bank, with one lender, and are offered a small window of information.   

Concerning the credit check process, mortgage brokers complete one and then use the credit bureau to shop the marketplace on your behalf with all the major banks, trust companies, credit unions and mono-line lenders. If you were to undertake this process on your own, there is the chance your credit could take a hit due to multiple credit checks.   

In British Columbia, mortgage brokers are licensed under the provincial government’s Financial Institution Commission, which means they operate under strict rules and regulations. These requirements are set out by the government, not by a private corporation, and are subject to third party oversight and legal ramifications. Each mortgage broker is required to complete training on a regular basis to keep their license and stay current on industry regulations. A bank mortgage specialist requires no licensing, no training or any regulatory updates.   

A mortgage is the defining document when it comes to owning a property. When it’s time to navigate the process, it’s important to choose the best option not just for the short term, but down the road too. Mortgage brokers are here for you whenever you need them, and they’re only happy unless you’re satisfied with the process and the end result.   

May 23, 2016

CLOSING COSTS - 9 ITEMS TO REMEMBER

CLOSING COSTS - 9 ITEMS TO REMEMBER

Closing costs and the remainder of your down payment are usually due a couple of days before the actual closing date. Payments are made directly to the lawyer.

  1. GST (Goods and Services Tax): Houses purchased from the builder are subject to GST. A purchaser of a newly built house should be satisfied as to how the GST is treated before signing the contract. The contract they have entered may require the payment of an additional 5% in GST. Relief is available by way of a GST New Housing Rebate. The rebate equals 36% (to a maximum of $8,750) of the GST payable on the purchase of homes under $450,000. In other words, a qualified purchaser will pay 4.48% GST after rebate. Sometimes the purchaser will assign the benefit of the rebate to the vendor with this being reflected in the purchase price.
  2. PTT (Property Transfer Tax): This tax is payable on the purchase of all real property in B.C. The calculation is based on 1% of the purchase price up to $200,000 and 2% of any amount above $200,000. Most first time buyers are exempt from this if they meet certain criteria. The main criteria are: a) borrower has never owned a principal residence anywhere; b) maximum purchase price of $475,000; c) borrow at least 70% of the purchase price; d) be a Canadian citizen or permanent resident, and residing in B.C. for a minimum of 12 months.
  3. CMHC/Genworth/CG Insurance Premium: If a purchaser has less than 20% down payment, they will need Mortgage Loan Insurance. Buyers with mortgage loan insurance can purchase a home with as little as 5% down. The cost of insuring the loan (loan insurance premium) depends on the size of the down payment. The premium can be added to the mortgage and paid as part of the monthly payment, or paid in a single lump sum at the time of purchase.
  4. Legal Fees: Legal representation will cost you approximately $875-$1000 for a purchase and a mortgage, add another $450 if you are selling a property at the same time. The legal fees to only register a mortgage will be in the $500-$600 range. Your legal fees should be negotiated up-front with your lawyer or notary.
  5. Property Tax Adjustment: Generally, property taxes for the calendar year are paid at the beginning of July. If you purchased a property before July 1st, the seller will be paying you for the days they owned the home from January 1st to the completion day. You then are responsible for the entire amount to be paid to the municipality on July 1st. If you purchase a property from the completion day to December 31st, as they will already have been paid the entire amount to the municipality on July 1st. To calculate this amount: one day's taxes on owner occupied properties is the annual taxes, less $570 homeowner grant, divided by 365 days.
  6. Title Insurance: Title insurance is an insurance policy that protects you, the home owner, against challenges to the ownership of your home or from problems related to the title to your home. The policy provides coverage against losses due to title defects, even if the defects existed before you purchased your home. A title defect is a problem with the title which prevents free and clear ownership. There are many types of defects such as rights of way, encroachments (from neighboring properties), unpaid liens, Fraud, etc. Title insurance policies protect you for as long as you own the property. Cost can range from $100 - $400
  7. Property Inspection: An inspection is a thorough evaluation of the structure, systems and components of a home. The inspection report is usually multi-paged, and comments on the condition of, but not limited to: foundations, electrical, plumbing, heating, water heaters, appliances, fireplaces, drainage, roof, walls, floors, attic, crawl spaces, patios, etc. This inspection is optional and normally costs $250-400.
  8. Insurance Binder: This is a requirement by a financial institution to ensure that the borrower has arranged sufficient insurance to cover any losses that may be incurred on the purchase. Proof of coverage by way of an insurance binder supplied by the insurance agent is necessary and usually costs $35.
  9. Processing/Appraisal Fee: This covers property valuation, administration, and processing of documentation for your mortgage. The fee (usually $240-$275) will vary according to the value of the property, and whether you have a conventional or highratio mortgage.
May 16, 2016

What can Frustrate a Deal

This week we have a few things to watch out for that can frustrate a deal from Vaneesh Dass - Mortgage Broker of Verico Xeva Mortgage

What can Frustrate a Deal

Contracts:

  • Adding the furniture to the contract
  • Thinking that the cashback from the developer when added to the contract is not going to be deducted from the purchase price
  • Dates
    • Completion of purchase and sale are the same date
    • Not setting a clear subject removal date and time so that the deadline isn’t missed
    • Client not having funds for the deposit, as they expect those funds from the sale.
  • Not addressing the presence of potential underground tanks in properties
  • Signatures not witnessed – not sure how strict lenders are on this now, TD used to be brutal for requiring it
  • Incorrect page numbers
  • PDS - client checks yes on a box relating to assessment or work done and then does not fill out the comments sections with info relating to the date, type of work and amount of assessment
  • Purchase Plus Improvements Deal – Not getting more than 5 business days for subject removal – 7-10 preferred so contractor can get access for quotes
  • Subject removal - On Saturday or Sunday, effectively gives you one or 2 less days as you have to get complete with lender Friday
  • Not specifying purchase price is inclusive or exclusive of GST on new home purchase
  • Blindly including a generic assignment clause, when the client has absolutely no intention of assigning
  • Being inaccurate about age restrictions, who manages the strata, rental restrictions, rental pool – I’ve seen realtors call it a rental pool, when it wasn’t and it killed the deal with one lender
  • Not adding the postal code to the address being purchased
  • When another person is being added to contract later, not writing in the addendum including that person’s name
  • Not letting the broker know that completion date has changed
  • Not adding the other realtor’s information

MLS Listings:

  • Comment referencing rain-screening or envelope work done years ago – automatically triggers the lender to ask for engineer’s report, proof of vote for full repair etc. I usually ask the Realtor for a new MLS with this removed
  • MLS mentions property sold furnished
  • Putting hobby farm in the description or pointing out income potential with the property
  • Describing that the Realtor “thinks” the property might have been a past grow op.
  • Unnecessarily pessimistic wording the notes, about the condition of the property – often makes lenders walk
  • Being inaccurate on the financial data – don’t include the strata, property taxes, etc. if you don’t know – do your research!
  • Not adding the property management company for condos/townhomes – the lender assumes it’s self-managed
May 9, 2016

New Down Payment Rules

This week we have the new down payment rules from Vaneesh Dass - Mortgage Broker of Verico Xeva Mortgage

NEW DOWN PAYMENT RULES

New down payment rules come into effect as of February 15, 2016.

The minimum down payment for new insured mortgages will increase from 5% to 10% for the portion of the house price above $500,000. For example: A $750,000 home will now require $50,000 down -- 5% for the first $500,000 and 10% down for the remaining $250,000.

Properties up to $500,000 will continue to require a minimum of 5% down. Properties in excess of $1 million will still require 20% down. According to the Ministry, these changes are meant to reduce taxpayer exposure while supporting long-term stability of the housing market

EXAMPLE OF A $700,000.00 PURCHASE

BEFORE FEBRUARY 15TH, 2016

5% MINIMUM DOWN PAYMENT

5% X $700,000.00 = $35,000.00

_______________________________

AFTER FEBRUARY 15TH, 2016

$500,000.00 @ 5% = $25,000.00

$200,000.00 @ 10% = $20,000.00

DOWN PAYMENT REQUIRED $45,000.00 AN INCREASE OF $10,000.00 FROM THE MINIMUM 5%

DOWNPAYMENT ACTUALLY 6.4%

If you would like to take advantage of the ‘old’ rules, you need to have a Purchase and Sale Agreement in place, including a mortgage application, by February 15, and the closing date must be no later than June 30.

The ministry is saying that this will only impact 1% of home purchasers. They figure that it will not affect the BC or Toronto Market, other cities in Canada we feel will be highly affected, definitely slowing down the market.

For more information visit www.vdass.ca 

    

May 2, 2016

Recognizing Risk Factors In A Property

When you enter a home, you are looking for the features you want and need—such as bathrooms, bedrooms, and a backyard.  But there are some other things you should be looking for as well when shopping for your new house.  Being aware of the potential risks in any given property can save you a lot of money in the long run. 

Home Insurance Risks
When you apply for a homeowner’s insurance policy, your rates will be based on the risk factors that the insurance company sees in the property.  Certain factors can increase your rates, and some can even mean you don’t qualify for the best policies. 

A swimming pool is something most people don’t recognize as a risk factor.  Insurance companies see it as a liability risk and are likely to increase your rates.  If the pool doesn’t have all of the features required (such as a fence of a certain height) you may even find the company refuses to cover it. 

Old wiring is another risk factor insurance companies don’t like to see.  It increases the odds of a fire, which makes it a risk for your family’s safety as well. 

Risks Of Future Damage 
When you look at a house, you should also look at where it’s located.  A home in a flood plain or near any body of water is at a higher risk for flooding.  Homes on hills may be at risk of landslides or other earth movement that can do a lot of damage. 

There are also factors about the home itself than can mean damage in the future. It’s important to make certain it is up to current codes and that the foundation is solid and without damage.  Foundation damage can occur over time due to earth movement, weather, water damage, and more.  It’s vital to have an inspector look at it closely, as foundation repair is very expensive. 

In The Details
There are some risk factors you can see just by looking at a home and the area it is in, but others are harder to spot.  A thorough inspection by a licensed home inspector is the best way to make sure that you are buying a safe and secure home without hidden problems that can come back to haunt you. 

Make sure you get a full inspection and go over it with a professional before you make an offer on a home.  It will uncover all of the risk factors you need to know about, both large and small.

Posted in Buying
April 25, 2016

Choosing A Selling REALTOR® 

Your REALTOR® is the person you count on to get your home sold, get you the best possible purchase price, and handle all of the details that go into selling a home.  If you are selling for the first time and it’s been a while since you bought, you may be on the hunt for a new REALTOR® to handle the sale of your property.  How do you choose?  Take a few simple tips into account. 

Selling Is Different From Buying 
Although most REALTORS® handle both listings and help buyers find a home, they may have more experience at one or the other.  Some REALTORS® are simply great at finding the right house for a potential buyer, while others are just really gifted when it comes to marketing a home well and getting it sold. 

When selling your home, you want a REALTOR® who has plenty of sold listings under his or her belt, and who has a reputation for getting homes sold quickly and for a good price.  Finding that person shouldn’t be too difficult with a little effort. 

Reputation And Referrals 
The first place to start is to ask for a few referrals.  Look to people you know who have recently listed or sold their home in your area.  You want a selling REALTOR® who knows your area and your market, so stick to people who are local if you can.  You can also ask your insurance agent, mortgage broker or other similar industry professional for some referrals. 

Once you have a list of referrals, take some time to see what their reputation is around town. You can use online services to read comments from other people who have used the company or the REALTOR® and get reviews for their services. 

Interview Your REALTOR® 
Before you hire a REALTOR® to handle your home selling job, meet with a few and ask them some questions.  Find out what their track record is for selling homes—how fast they sell and how they handle marketing.  Look for someone you get along with well and communicate with well, since you will have a close working relationship until your home is sold. 

Choose the REALTOR® you feel has the best combination of experience, knowledge, and a personality you get along with.  The bottom line is getting results and getting your home sold—but you also want someone you like and trust to handle such an important transaction for you.

Posted in Selling
April 18, 2016

Home Listing Terms To Know 

Home buying has its own set of terms and phrases that buyers should know when perusing the listings.  As with any specialized area, the terms used in home listings are often confusing at first, but understanding them is simple enough once you get to know how they are used.  Take a look at these common home listing terms and their meanings before you start house shopping. 

The Basics Of Describing A Home
In a listing, the description of the home is one of the most important things to understand.  It tells you all of the basics of the home’s size and features, things that will help you decide if you want to go take a closer look.  Here are a few of the basic terms and abbreviations you will need to know. 

BR/BA: Bedrooms and baths.  This tells you how many bedrooms and bathrooms the home has. 

Bonus Room or Den: This is a room that does not qualify as a bedroom because it has no closet, but may still be a separate room with a door.  Bonus room may be abbreviated as bns rm. 

Det: Detached, usually used in reference to a garage. 

C/A and C/VAC: Central air and central vacuum. 

F/A: Forced air, used in reference to the heating system. 

DR/FDR: Dining room and formal dining room.  A formal dining room is usually a separate room that includes lighting, making it more formal than an open dining room. 

OSP: Off-street parking.  This can be important if you are looking at condos or townhomes. 

FCD YD: Fenced yard. 

Terms Of The Sale
Some of the terms that are important in a listing don’t just describe the home; they describe important things to know about the actual sale of the home.  Get to know these abbreviations and terms so you will have an idea of what you might be getting into. 

FSBO: For sale by owner.  This means that the owner is acting as his or her own realtor in the sale and has not hired a professional to negotiate. 

Bank-owned: This is a property that is owned by the bank, usually due to a foreclosure. 

Owner Finance: This means that the owner is willing to finance the sale, rather than using a traditional mortgage with a bank or other lender. 

Quick Possession, or Q/P: This means that the home is often already vacant and the sellers are looking to close quickly. 

Contingencies: The most common contingency is that the sale is dependent on the owner finding a new home to which to move.  This means that the process could be delayed. 

Your REALTOR® can help you with any terminology in a listing you don’t understand and make sure that your home hunt is smooth and easy.

Posted in Buying
April 11, 2016

Five Steps To Holding A Successful Open House

An open house is one way that REALTORS® attempt to expose a home to multiple buyers at once.  Not only is an open house designed to market the home in a way that differs from a simple listing, but it also opens the door for competitive offers as more than one buyer could potentially fall in love with a home on the same day. 

 

Step # 1: Make Your Home Shine 

A successful open house begins with cleanliness, so make sure that your home is ready to be shown.  This means the clutter should be removed and the home should be “staged” to allow potential buyers to envision themselves living in a beautifully decorated home. 

 

Step # 2: Cross Your T’s & Dot Your I’s 

Your next step to an open house is making sure that the price is right.  If the day is successful, you may be fielding offers within hours, so be ready to make a deal.  Most open houses are advertised locally in order to attract buyers looking to move into the area, which means a newspaper ad may have a lot of potential.  The advertisement should feature a photo, along with text that outlines all of the unique and positive aspects of the home.  The date, time and clear directions should also be given in the ad, along with the REALTOR’S® contact information.  Before your ad goes to press, make sure that you have proofread it to ensure accuracy. 

 

Step # 3: Spruce Up Your Curb Appeal 

As buyers begin to show up for your open house, they will want to see attractive landscaping with an inviting atmosphere.  This will make them eager to see what’s inside the home.  The front yard should feature an Open House sign with colorful balloons, but don’t forget to place signs along the street (with permission, of course) to help potential buyers find you. 

Make sure the lawn is freshly cut and flower beds are well kept.  Any clutter, including bicycles or yard care equipment should be removed to produce a visually pleasing image of the home.  Make sure your windows and doors are sparkling clean and free of fingerprints.  Nothing should distract buyers from the prize, which is your house. 

 

Step # 4: Feed Your Guests 

It’s customary for every open house to have complimentary coffee or other refreshments and/or cookies.  The smell of freshly baked cookies will give buyers the feeling of being at home—exactly the type of reaction you want when trying to sell your home. 

 

Step # 5: Reading Material Is Golden 

Your REALTOR® should provide a business card and/or informational sheet for each potential buyer that tours your home.  If this is not a service that they offer, take a few minutes to design your own flyer using a computer and print out some full-color circulars to offer interested parties as they arrive.  You should also provide copies of any appraisal, inspection or other information about the home that potential buyers would find interesting. 

Posted in Selling
April 4, 2016

A Home For All Seasons: Year-Round Considerations

A Home For All Seasons: Year-Round Considerations 

Whatever time of year you find yourself shopping for a new home, it’s important to give some thought to what that home will be like throughout the rest of the year.  Be on the lookout for things that could affect the access and comfort of your home through all the months of the year. 

 

Winter Considerations 

If you live in an area with heavy snow, it’s important to give serious thought to how accessible your home will be in those months.  Homes on hills might find the roads impassable due to ice, while homes with long driveways will require a lot of snow clearing to get out. 

If you are expecting cold winters, the function of your furnace is a vital piece of the puzzle, so be sure the home has a heating system that works well.  You might also look for alternate heating in your home, such as a wood stove or fireplace insert. 

 

Things To Think About In Spring 

Spring can often mean a lot of water, whether from those April showers or melting snow.  The drainage on the property is important to making certain that water doesn’t cause problems such as earth shifting or flooding.  Look for things like retaining walls and a slope to the property that allows it to drain. 

Spring can also come with a lot of yard work.  Remember that a big yard looks like a lot of fun—and it is—but it also means a lot of work.  A spring cleanup is a must in many areas as it won’t just be the pretty flowers growing in the spring, but those pesky weeds, too. 

 

Summer Thoughts 

Summer is the time when most people want to spend time outside, enjoying the sunshine.  It’s also the time when most areas are driest, meaning a lot of watering to keep the plants and grass green.  If you are considering a larger lot, think about the cost of watering it.  You might also want to look for a built-in sprinkler system so you won’t forget to water. 

The direction in which the house faces will determine how much sun you get both in the home and in the backyard.  If the yard will get a lot of sun, you might want to look for a home with a covered patio or awning. 

 

Facing Fall 

Those big beautiful trees around a property make it look lovely and offer shade.  Come fall they also mean a lot of leaves all over the ground and a lot of work picking them up. 

Every season has things that homeowners will have to deal with; before you buy, make sure you’ve given a lot of thought to how that home will take you through each season so you can be prepared.

Posted in Buying
March 28, 2016

Ten Tips To Successfully Market Your Home

Ten Tips To Successfully Market Your Home

There is a lot more to putting your home up for sale than placing a sign on the front lawn.  Selling your home quickly and getting the best price possible requires marketing your property and using the services of an experienced agent.  Here are some of the strategies you can use to market your home. 

Hire A Professional REALTOR®—The ability to market your home is always best served by hiring a real estate expert.  They have access to resources that you as an individual do not, and their experience and knowledge are certainly worth the commission. 

Photograph The Exterior Of Your Home—Good high quality photographs of the entire exterior of your home can really spark the interest of potential buyers. These photographs can be used in a variety of online and print marketing campaigns. 

Photograph The Interior Of Your Home—Be sure you also have good quality photos of every major room in your home, especially the kitchen, bathrooms, and master bedroom.  Also ensure that these pictures are taken in good light, and from angles that best highlight the space they are to represent. 

Purchase A Virtual Tour—Virtual tours are one of the latest and most effective marketing methods in the real estate industry.  Essentially a virtual tour allows potential viewers to get a 360-degree perspective of your property from the comfort of their home or office.  This method is also a great way to assure that only interested buyers show up at an open house. Your agent can have these tours put on multiple listing websites as well as on their own pages. 

Print Advertising—While this may seem to be a costly and outdated marketing method, there are still a considerable number of potential buyers who use print resources to find prospective properties. 

Signage—Be sure you have clear, visible signage on your property that indicates it is for sale.  Also, be sure your agent’s contact information can be seen from a distance so that those passing by can take down their name and number. 

Direct Mail—Again, this may seem like an outdated method of advertising, but it is still effective, especially if your home may appeal to an older demographic. 

Open Houses—This is still the most effective way to get a sale.  Be sure your home is in clean and presentable condition before hosting an open house, and ask your REALTOR® for advice about preparing your home for such an opening. 

Agent Tours—These tours can give agents a better look at your home without having the general public in your house, and can assist them in matching your home with their clients. Your agent can arrange these tours. 

E-marketing—Like print advertising, this is a fairly inexpensive and effective method of marketing your home that your REALTOR® can offer to you as part of their services.

Posted in Selling