Pre Construction Cost

The following is a brief overview of the main expenses that usually accompany pre-built condo ownership.

Pre-Registration costs

For all intents and purposes, once you move into a newly constructed condo building your paying rent to start. That is, until your new condo building is “registered” with a provincial land registry office. The monthly “occupancy fee” you are charged by the development once you are living in the building but before the building is registered does not go towards your mortgage. Once the building registration takes place, normal mortgage payments processes then kick in.

Here is an example of how these “pre-registration” rental costs are calculated:

Purchase price :$200.000

Deposit paid to the builder: 20% / $40.000

The remaining balance due to the builder : $160.000

Interest to the builder for this remaining balance. Builders typically take the 1 year Mortgage interest rate posted from Bank of Canada. So if the interest rate is 3.75% it would be

$160.000 x 3.75% = $6.000/12 = $500 monthly

Additionally you have to pay condo fees, let’s say $200 monthly and property taxes, calculated based on the purchase price and the property tax rate, 200.000 x 0.08 = $1600 a year – $133.33 monthly.

The occupancy fee will be $500 + $200 + $133.33 = $833.33 monthly until registration is complete.

Here is some additional information on the difference between pre-registration and registration.

Condo Maintenance Fees

Condo fees are your share of the costs that contribute to running the building as a whole for all common areas, including amenities such as party rooms, swimming pools and fitness facilities.  Typically these fees cover items such as maintenance staff, security and repairs and are usually based on the total square footage of your condo unit. These fees also include general maintenance e.g. window cleaning, snow shoveling, cleaning and landscaping.

Portions of your monthly condo fees go into a “reserve fund”. The reserve fund is there to cover any major repairs and replacements of common elements that will be needed as time passes. These can include the roof, exterior of the building, sidewalks, roads, sewers, heating, electrical, plumbing, elevators, laundry and recreational facilities.

Increasing condo fees

Condo fees can be increased due to an unexpected major repair not covered by the reserve fund, a lawsuit involving the condo corporation or to keep up with general rising costs of services.

Newly built condos may increase significantly in the second or third year due to certain amenities not being included in the first year. For example, a guest suite that a corporation may buy as an asset might not take effect until the second year.

Special assessments

This is an expenses that can be charged from time to time on top of regular monthly condos fees to help pay for major unexpected repairs or to cover shortfalls in the reserve fund.

Legal Fees

While the builder usually pays real estate service costs, you will have to pay for your own legal representation. Typically real estate lawyers charge between $700.00 and $2000.00 for their services, which are mostly focused on making sure the contract you sign is in order and meets industry and governmental regulations.

Mortgage Fees

Unless you buy your condo outright, at some point you are going to need a loan. Loans associated with real estate are usually called mortgages. After the bank lends you the money needed to pay for your condo in full, a mortgage is put in place to give individuals an easy and structured process to pay that money back. This is usually structured as a monthly repayment schedule. A mortgage repayment schedule is usually set up so that in the early years, a greater percentage of each payment covers interest charges and a smaller percentage covers principal repayment. Over time, this changes so that a greater percentage of each payment goes towards paying down the principal, and less towards paying interest.

The more of the principal you pay down, the greater the equity you build up in your condo. Basically, equity is the amount of your condo that you own. For example, if your condo is worth $350,000 and your mortgage is for $300,000, you have $50,000 in equity.

Resident Insurance

In most cases, you will be responsible for and required to maintain and repair the basic elements of your unit. Interior elements of your condo unit, such as plumbing and electrical are usually covered by the condo corporation’s insurance. The rest, basically everything from the paint inward, including your furniture and other contents of the unit, would be your financial responsibility.

Insurance policies may also have an impact on you if there is damage to your condo or surrounding condos; For example if there is a flood in your condo and it damages the condo below you, you may be responsible for costs associated with the repair of the resulting damage to other condos or to common areas. Part of the cost of tenant insurance also goes to cover you for liability should you directly cause any damage to the common areas of the building.

Pre-Construction Condos – Occupancy Fees Explained

The Occupancy Period (aka Phantom Rent)


When you’re looking to purchase a pre-construction condo one of the biggest questions is “when will it be completed?”.


And the date that the builder or their sales rep will tell you is what’s called the “occupancy date”. Most people assume this is the day that they will get their condo. And they’re right…there’s just one issue. You don’t actually own your condo when you first receive your keys.


In pre-construction condos there are two types of closing: 1) Interim Occupancy; and 2) Final Closing.


Interim Occupancy


Let’s say that you bought on the 5th floor of a 30-storey condo. Typically, when a building is approximately 60% sold, construction begins. After awhile (let’s say two years) the building is almost entirely complete including your unit.


The builder, not wanting to let the units sit empty until the entire building is completed, will call you up and tell you that your unit is ready and you can schedule a time to sign some paperwork and get your keys.


This is where the buyer really needs to pay attention (specifically before they sign the agreement of purchase). You will receive your keys from the builder and in exchange you will give them post-dated cheques to cover your “occupancy fee”.


Ok, so what’s an occupancy fee?


An occupancy fee (sometimes referred to as phantom rent) is a fee that a buyer will pay until final closing. I’m sure you have a couple of questions. First, how much is the occupancy fee and when is final closing?


The occupancy fee structure is determined by the builder and will be in your purchase of agreement when you first sign your deal. It can include any of the following but cannot be greater than them:


interest calculated on a monthly basis on the unpaid balance of the purchase price at a prescribed rate;

an amount reasonably estimated on a monthly basis for municipal taxes attributable to the unit; and

the projected monthly common expense contribution for the unit.

Ok, so in plain english that means that the occupancy fee will be made up of the interest portion on the balance of your purchase price, the estimated monthly taxes, and the estimated monthly maintenance fees.


A couple of things to mention:


The amount of the occupancy fee is about what you’d expect to pay once you receive your mortgage because the first few years of a mortgage payment mostly consist of paying off the interest, and;

The occupancy period normally last anywhere from 3-6 months.

On that last point, it’s impossible to tell how long the occupancy period will last. It will depend on the reputation of the builder, but most importantly it will depend on how many floors there are in the condo and what floor you purchased your unit.


So, in our example you would have bought on the 5th floor of a 30-floor condo which means that your occupancy period would last longer than someone who bought on the 28th floor. And, of course, if you bought on the 28th floor you would have a much shorter occupancy period than someone who bought on the 5th floor.


Final Closing


I can imagine you’re not too thrilled right now. So, you’re telling me that I’ve put down 20%, waited 3 years for my condo and when I’ve finally gotten my keys the unit still isn’t mine but I have to pay what basically amounts to a mortgage payment for anywhere from 3-6 months???


Unfortunately, yes…


You will not receive title to your condo until the building passes site and city approval. This process can take a few months.


So, what happens to the occupancy fee? Does it go towards my mortgage?


Unfortunately it does not. The money goes directly to the builder. They essentially use this money to recover the costs of trying to continue to sell unsold units and get the building running.


One thing to keep in mind is that the builder doesn’t get any of your downpayment until the building closes, so they have the incentive to have as quick of an occupancy period as possible. They want their units sold and they want their money so they can move onto future projects.


So, to reiterate, you will be paying a monthly fee to the builder that is pretty close to what you can expect to pay for your mortgage.


Once you do get that communication from the builder that the building is registered, you will then have to arrange your mortgage for closing. Once that is completed, title is officially transferred to you and then you will begin your monthly mortgage payments.


What are the takeaways from this blogpost?


First, it’s super important to have your purchase of sale agreement reviewed by a lawyer that specializes in pre-construction condos.


They will be able to lay out the details of the occupancy fee structure and tell you what the builder has included as part of the fee.


Second, that fee will typically include the interest on the unpaid balance of your purchase price, monthly property tax and monthly maintenance fees. This will be approximately what you can expect to pay for a mortgage once you have title. If you pay too much during occupancy, the builder will credit you on closing. If you pay too little, it’s up to the builder to determine if you have to make that adjustment on closing.


Finally, it’s important to keep this process in mind when choosing which floor to purchase on. The lower the floor that you purchase on the longer your occupancy period will last.


However, that doesn’t mean that you should just purchase on the highest floor because builders will include a per floor premium on top of the listed purchase price. There can easily be a $30,000 difference between the same unit on the 5th floor and 20th floor (at a $2000/floor premium).


The most important thing is to understand that this process exists and realistically there is no way out of it. You just have to do your research and hope that the occupancy period is short!


If you have any questions about the occupancy period that I didn’t go over please leave a comment below or contact me directly!

Assignment of Contract of Purchase and Sale BC

There have been a number of pre-sale condos popping up in the Lower Mainland, and rezoning is happening in a number of places to allow for new residential buildings. With the new City of Lougheed development, as well as many others like the Solo district, Pier West, Simon, and more, we’ve had a number of people asking us about assignment of contracts, and how it works.


It is important to note that while the majority of assignments occur in pre-sale properties, they can also occur in resale properties if the buyer is unable to complete for whatever reason. To make this as easy as possible, we’ve written this blog in a question answer format for understanding an assignment of contract in real estate.


What is an assignment?

An assignment of contract in real estate is a transaction of a home in which the buyer of the property “assigns” or transfers their rights and obligations of the Agreement of Purchase and Sale previously agreed to another buyer before the original buyer closes on the property. In this case, because completion has not occurred, they are not the legal owner for the property yet, thus they require consent from either the seller or the developer(often times the developer).


This can occur in both resale and presale homes; however, assignments are most commonly found in presales where there is a longer closing, often 5 years away.


When can I assign a home? Are there any restrictions?

You will have to refer back to the original contract of purchase and sale to determine whether or not you are able to assign the home. Some terms you may encounter, specifically for presales, are:


The developer or seller’s approval

Resale profits must be split with the seller unless otherwise agreed to in the contract

Marketing can be very tricky. MLS (multiple listing service) restrictions for online marketing may be prohibited, many developers do not allow the advertising and sale of assignments until the building is sold out.

A time frame when you cannot assign the contract

An assignment fee to be paid to the developer in the presale scenario, usually 2-5% of the sale price.


Why do assignments occur?

Assignments often occur when a presale has appreciated significantly in value prior to completion. The current buyer would like to take the appreciation (often called a “lift”) while it’s up, and assign it to another buyer.


Are assignments legal?

Yes. Real estate contracts are assignable under the law unless the contract expressly forbids it.


In the past – “Shadow Flipping”:

It used to be the case where buyers could “shadow flip” in residential sales, and did not require the sellers approval in order to assign the property prior to completion. This was a huge issue in residential real estate sales in 2015 particularly, and was subject to scrutiny by the public and news broadcasters.


The Real Estate Council of BC has since required that an assignment needs to be approved by the seller and profit be split equally between the current buyer and the seller once assigned. The contract of purchase and sale for resale residential properties has also been updated to avoid “shadow flipping” and assignments without the sellers knowledge. The restriction of assigning properties for profit only applies to resale, and presale can still be assigned at the discretion of the developer.


Assignments now occur in residential resale real estate more-so in some kind of emergency from the buyer, where they are unable to complete for whatever reason like a loss of employment, death, or critical illness. In resale, assignment of contract for profit is less common now than it used to be.


What are the advantages of an assignment for the current buyer assigning the contract?

The assignor (current buyer) can most likely avoid the builder’s closing costs and property transfer tax associated with the subject property;

The assignor may not have to pay the additional taxes (i.e GST) rebate back to the Builder if they intended to occupy the property.

The seller/assignor avoids the carrying costs (mortgage, maintenance fees, taxes, etc.) for the time between listing the property and selling a property that is already completed.

What are the advantages of an assignment for the new buyer?

The assignee (new buyer) may receive a better price than other current properties on the market. This will also depend on the current buyer’s motivation to sell;

The assignee will receive a brand-new home and may also have the opportunity to make finishing selections, such as the kitchen or bathroom colour scheme, depending on when the assignment takes place;

The assignee may be able to avoid Property Transfer Tax if the original Agreement of Purchase and Sale is under $750,000;

The assignee may be able to take advantage of the deposits of the original buyer and be able to put less of a down payment on a property than he would otherwise have been able to.

Are there any restrictions involved with assignments when selling?

Yes, there are a number of restrictions that the developer can put in to the contract that make assigning a home more difficult. The most common restrictions are:


Marketing/MLS restrictions – Your realtor may not be able to advertise on the MLS, so it’s important that you hire someone with a history in presales and a great network

Sales restrictions – The developer will often put restrictions on the number of units that can be assigned at a time, as well as restrictions such as not being able to assign until the building is 100% sold. Refer to the contract for details on restrictions.

Fees associated with an assignment?

If this is a resale home that you are assigning, you will most likely have to split the profits of the assignment with the seller unless otherwise agreed to. Typically there are extra legal fees and there is an assignment fee to the builder if it is a presale assignment.


As previously mentioned, most assignments have the new buyer taking full responsibility for the contract; however, it may be the case where the new buyer and the original buyer have agreed to split some adjustment costs.


You’ll be listing the property, so you will also have to take in to account realtor commissions when assessing your net profits on an assignment.


Are there tax implications on assignments?

If you are unsure about the tax implications, it is always best to speak to an accountant to determine an estimate on what you may incur.


In general though, any profit from the assignment of a property that goes to the current buyer, after having been split out to the seller if previously agreed upon, is subject to tax as part of your income. With regards to property transfer tax, and any goods and services tax on the property, this is typically paid by the new buyer as they are responsible for taking over the contract of purchase and sale in its entirety, unless otherwise agreed upon.


Are there risks involved?

It is very important to make sure that the new buyer is willing and able to take on the assignment as well as all terms and conditions of the contract of purchase and sale. If the assignee, the new buyer, does not follow through with the completion on the sale, the responsibility to close usually defaults back to the original buyer, the assignor.


If you are thinking about assigning a property, make sure to talk to a realtor first to determine whether or not you will make a profit. They’ll need to take a look at your original contract, and also assess the current market to determine an estimate of the market value of the subject property. There is no guarantee that there will be profit associated, in fact there may be a loss in a declining market. Your realtor will have to factor in all costs associated, such as fees and commissions, in order for you to make the best informed decision.


If you’re thinking about assigning your contract, give us a call today to see what’s right for you: Prefer text? 604-808-2275 or email to start a conversation.


Tax Tips and Traps

As tax season is upon us  I thought I offer some tax tips and tricks!


If you have rental losses, they should try to deduct as many expenses as possible from other income sources such as a business income.

Capital cost allowance (CCA) on rental properties cannot be used to create or increase losses. The pre-CCA rental income is calculated on a pooled basis and includes any recaptured amounts. As a result taxpayers with rental losses should first deduct from rental income expenses that can only be attributed to such income and then deduct the CCA attributable to the rental property. Expenses which can be attributed to other income sources should be deducted. If they are deducted against the rental income, the taxpayer will be required to reduce the amount of CCA claimed, which would reduce the overall amount of expenses deductible against total income.

As an example, accounting fees may be deductible from investment income rather than from the taxpayer's rental income.

The spouse with the lower marginal tax rate own the property on which taxable capital gains may arise.

By having the spouse with the lower marginal tax rate own the property, taxpayers can reduce the amount of tax payable on any capital gains to avoid the Income Tax Act's attribution rules. However, that spouse would also have to report the ongoing rental income or loss. CRA may look to the spouse's relative contribution to the purchase price of the property in assessing the reasonableness of the above strategy.

Leasehold inducements can be deducted from capital costs, rather than being included in the current year's income, by filing a special election.

Filing the special "subsection 13(7.4)" election allows taxpayers who purchases property to reduce the capital cost of leasehold improvements made to the property to the extent of the leasehold inducements. Without such an election, any leasehold inducements must be included in income and taxed in the current year. By electing to reduce the capital cost of leasehold improvements, the inducements are spread over the term of the lease, by reducing the CCA that would otherwise have been deducted in subsequent years. The election, therefore, results in a significant deferral.

No specific form has been developed by CRA for this election, so a simple letter stating the taxpayer's intention to make the election will suffice. It is extremely important to file your income tax on time, as CRA has denied this election where tax return were filed late.

Capital Cost Allowance (CCA) is the mechanism by which the INCOME TAX ACT permits the costs of purchasing an asset to be "written off", that is, deducted from a taxpayer's income. It is based on an often arbitrary set of rates set by the INCOME TAX ACT, and is subject to changes by government for economic and political purposes. CCA rates and rules are important because they impact the after tax earnings of the property owner.

There are currently many separate CCA classes, each with lengthy descriptions of what assets are to be included. Each class has it own rate at which the cost of assets in the class may be deducted from a taxpayer's income. The prescribed rate for each CCA is the maximum rate at which the cost of assets in that class may be deducted from the income in a year. The seven classes which included most real estate related assets are described on:

To be eligible to for CCA, an asset must be acquired to gain or produce income. Assets owned and used for personal purposes, or owned and used for other purposes that do no gain or produce income, are not eligible for CCA deductions.

Generally, all assets falling within the description of a CCA class are pooled together for the purpose of determining the permissible CCA deduction. in so doing, a CCA "pool" representing the cost of all assets in the CCA class is created. Whenever any CCA is deducted from income, that same amount is deducted from the CCA pool, which reduces the amount of CCA deductible in the future.

Whenever an asset is purchased, its capital cost is added to the CCA pool, which increases the amount of CCA deductible in the future. After making the appropriate deductions from the CCA pool, the resulting amount is referred to as the undepreciated capital cost (UCC) of the pool. UCC is directly analogous to the accounting concept of "net book value."

There are several rules which affect these standard CCA calculations.

> With few exceptions, in the year that the asset was purchased, only one half of the normal CCA deduction is allowed.

> CCA cannot be claimed on a building until the earlier fo the date it is available for use and the second year after the building is acquired. Generally, the term "available for use" means the earlier of the time that construction is completed or the time that substantially all the building is used for its intended use.

> CCA cannot be created or increase a loss on a group of rental properties. This means that in a given year the taxpayer may have to restrict the CCA deduction for certain classes.

When an asset is sold, its adjusted cost based or the proceeds of its sale, whichever is lower, is deducted from the UCC pool. If, after the sale of all assets in a UCC pool balance is positive, the remaining balance is included in the taxpayer's income as "recaptured CCA" On the other hand, if the UCC pool balance is negative, that amount is deducted from the taxpayer's income as a "terminal loss"

Unlike many other deductions, CCA can be carried forward indefinitely until the taxpayer either sells the relevant asset or chooses to deduct the CCA from income.

If the taxpayer sells an asset in a certain class before the end of the year, the proceeds of the sale - up to the amount of the original cost of the asset sold - must be deducted from the total UCC fo the class. If an asset is the sole property in a class and it is sold for proceeds less than its UCC, the balance of the UCC can de deducted as an expense of the taxpayer. Such a deduction is commonly referred to as a "terminal loss" On the other hand, if the proceeds of the sale of such an asset exceed its UCC, the excess will be considered to be the taxpayer. Such an addition to income is commonly referred to as a "recapture"

Generally CCA is applied on the UCC of assets as of the end of the taxation year. UCC is defined in the INCOME TAX ACT as the capital cost of an asset plus adjustments for recapture and certain other amounts. The term "capital cost" is not defined but is generally the amount actually spent by a taxpayer to acquire an asset. Although it is tempting to use the value of an asset to determine its capital cost, capital cost is based on the cost of the asset and not on its value. Capital cost includes all "laid-down" cost such as freight, installation, duties and Goods and Services Tax, and is calculated net of any amount received in the way of inducements, grants or tax credits including the Goods and Services Tax, credit or rebates.

In certain circumstances, the INCOME TAX ACT provides specific rules to determine the capital cost of property. For example, a taxpayer acquires property for some purpose and later commences to use it to ear income. fro CCA purposes, the taxpayer acquires the property on the date of its change in use for its fair market value where such value is less than the property cost. Where the property's fair market value exceeds its cost, the taxpayer acquires the property for its actual cost before the change in use.

Where a taxpayer uses an asset regularly for both personal and business purposes, CCA will be calculated on the proportion of use for business compared to its overall use. If the proportion of use changes, the basis of cCA will change accordingly.

CCA may only be claimed on property owners by a taxpayer or property in which a taxpayer has leasehold interest.

Also see:





Claiming CCA creates a deduction for tax purposes but in doing so, it reduces the UCC pool. This usually results in "recapture," in the year of the sale, of the amount previously deducted. While the deferral of tax is generally worthwhile, there may be some cases when you may not want to defer taxes. For example, deferring taxes in a year when your client is in a low tax bracket year will result in a higher overall tax liability if the recapture arises when you are in a higher tax bracket.

When should you claim the maximum CCA?

Generally, you should claim the maximum CCA available, even if it increases the taxpayer's total loss from all sources, since loss can be carried forward for 20 years, beginning in 2008. However, if there is a possibility of insufficient taxable income in the carry forward year, it may be wise not to claim the maximum CCA. If there is insufficient income to use up the losses carried forward, they will "expire" and they will no longer be available to you to reduce taxable income. On the other hand, unclaimed CCA can remain available indefinitely.

Whenever possible, consider making asset acquisitions on or just before DEC 31

Although only one-half of CCA is allowed in the first year of the purchase of most assets, the asset can be purchased at any time in the year (subject to available for use rule). As a result, if an asset is purchased just before the taxpayer's year end, the taxpayer may claim one-half year's worth of CCA even though the taxpayer may claim one-half year worth of CCA even though the taxpayer only owned the asset for one day.

Claim maximum CCA on lower-rate classes first.

If you must reduce CCA claim from the maximum rate allowable, consider reducing the CCA claimed on the high-rate classes and maximize the CCA claimed on the lower-rate classes. This will allow more flexibility and higher CCA claims in the future year.

Maximize CCA claim on assets that are expected to be held the longest.

If you need to restrict CCA (because of the rental loss restriction, for example), claiming CCA on assets they intend to hold onto the longest will defer recaptured CCA. There will be some recapture on that amount when the property is sold, but the recapture will be deferred for as long as the property is held.

You can avoid recaptured CCA, and capital gains resulting from involuntary sale, by replacing property within the specified time limits.

An involuntary sale of property, such as expropriation, or property destroyed and covered by insurance, gives rise to a sale that may result in recaptured CCA and capital gains. The recapture and capital gain may be avoided by repurchasing within specified time limits, similar property to be used in the same or similar business. For land and buildings, the property must be replaced before the end fo the first taxation year following the year of the sale of the original property.

* Intended to help you recognize tax opportunities and pitfalls in the special field of real estate sales and investing. Most Canadian taxpayers find the tax system daunting. Without an understanding of tax law, they are unable to identify the issues or the opportunities. If their tax return involves more than the straightforward reporting of an annual salary, many taxpayers seek out services of an expert. This post is to simply provide some tax planning opportunities or pitfalls. It is up to you to seek out professional tax advisors to flush out and resolve the relevant tax issues. This should only be consider a starting point for further discussions between you and your tax advisors. Consult your own income tax advisors concerning the income tax consequences of particular real estate transactions.


Mortgage Insurance

Mortgage Insurance 


In Canada, when applying for a conventional mortgage, the lender typically will require approximately (or at least historically) a 20 per cent down payment. Because over the last two decades home prices have increased dramatically, many borrowers find it difficult to raise such a high down payment. 

Mortgage insurance is therefore available to Canadians in order to allow what is called “high-ratio” financing. Mortgage insurers, such as CMHC, will nance approximately 95 per cent of the purchase price of a home, allowing buyers to proceed with a purchase, and at the same time protecting lenders whose risk clearly increases with high-ratio lending. 

The insurer will charge the borrowers for the financing. Usually the charge to the borrowers is a percentage of the loan. Typically the fee is subtracted from the amount the lender will actually advance, which has the effect of increasing the down payment requirement to the borrowers. Historically, the charge was around 2.50 per cent of the loan amount. 

Mortgage insurance allows the buyers to realize their dream of home ownership by protecting approved lenders against buyers who default. The insurance premiums vary and depend on whether the mortgage loan is advanced all at once or in instalments, e.g., a building loan. The lender picks the processing option and the applicable premium is charged. 

For insurance purposes, there are conventional mortgages and high-ratio mortgages. For conventional mortgages (which are uninsured), financing is generally restricted to a maximum of 75 - 80 per cent of the loan-to-value. (Loan-to-value means the percentage of loan to the appraised value of the property or the purchase price, whichever is less.) In cases where the mortgage will exceed 75 per cent of the loan-to-value (high-ratio), the mortgage has to be insured, although the bank will also consider risk assessment when lending insured mortgages. Lenders have underwriters who look at underwriting policies and statistical information to determine risk assessment. In addition to looking at the risk level of the buyers, they also look at the market conditions and the property to be mortgaged. 


Mortgage insurance is available for residential properties of up to four units, as long as the owner occupies one unit. This includes single-family houses, manufactured homes, condominium units, houses on leasehold land, and housing on reserves. This enables buyers to purchase a home with as little as five per cent down. The minimum five per cent down must come from the borrower’s own resources, and the lender must verify that the borrower can cover. Buyers should be aware of legal fees, appraisal fees, and Property Transfer Tax (PTT), etc., which is always changing. Amortization is usually restricted to a maximum of 35 years. 

The maximum loan-to-value ratio is: 

        ◆  one unit – 95 per cent

        ◆  two units (duplex) – 92.5 per cent

        ◆  three or four units – 90 per cent
There are several types of properties, which may be turned down for conventional, and/or high- ratio mortgage purposes. These are:

        ◆  seasonally occupied properties/cottages, ski chalets;

        ◆  rooming or boarding houses;

        ◆  houses of inferior construction (structural problems/foundation, trusses, decaying oor joists/ lacking central heating system);

        ◆  properties in an area that is being rezoned and redeveloped, where the value is entirely or predominantly attributable to the land alone;

        ◆  houses containing urea formaldehyde foam insulation (UFFI);

        ◆  most property located in an area that is zoned commercial or industrial;

        ◆  property in a deteriorating location or neighbourhood;

        ◆  a residential unit within 200 feet of an overhead, elevated roadway, and close to overhead high tension wires;

        ◆  property which is serviced by a polluted well, or trucked-in water, or a from water source which is illegal or not guaranteed with an appropriate party agreement;

        ◆  property which backs onto industrial building/auto repair shop/gas station;

        ◆  condominium units in a building in which the condominium corporation does not have an adequate reserve fund or has pending lawsuits. This will create marketability problems for the units;

        ◆  property which does not have a central heating system or adequate electrical service (less than 60 amps);

        ◆  property in remote areas, where there is no determinable real estate market; and

        ◆  property in environmentally sensitive areas. 

How is business!

I always find it funny when family and friends ask how you are doing and whether you're struggling or not with your business. Its funny because most of the time you're either too proud to give the real answer and even if your business is doing great, where does the conversation lead into; there a good chance I would probably jokingly throw in "why... do you have a referral or do you want to buy something or how can I help you (my favourite) because essentially I just enjoy being the source of information and being able to impact society and help others at the same time. In the long run I hope to own my own developments projects and build many impactful businesses that will change the skylines of this awesome city.

I don’t know why so many people are hiding behind this idea of not looking desperate. Look, I’m trying to grow my business—I’m desperate. Every time I call someone, I leave a message. Every time I make a visit down the street, I leave a business card there with someone—even if I’ve been there 3 times that day. I want their business. You are either growing or you're dying period. A better question is whether the person is HAPPY! doing what you're passionate about doing is the freedom to dictate your own day and paint your own canvas. I really enjoy filling my daily schedules with client meetings and attending awesome events and being apart of people's milestones in their lives! I feel like I am taking the necessary steps to build towards my own dream!

You're either building your own dream or someone else will hire you to help build theirs!

Empty home Tax By Feb 2nd

Every owner of residential property in Vancouver is required to submit a property status declaration each year to determine if their property is subject to the Empty Homes Tax.

Failure to declare by February 2, 2018, will result in your property being deemed vacant and subject to a tax of 1% of its assessed taxable value.

This declaration is for the year:

  • Beginning: January 1, 2017
  • Ending: December 31, 2017

The information you provide on your declaration will determine if your property is subject to the Empty Homes Tax for this period.

Submit your 2017 Empty Homes Tax declaration

Jameson House

Lets learn about my city! I am trying to post the new developments in Vancouver - specially so many new buildings being built these last few years its hard to keep track! So new years I am gonna post one each day. I am going to start with a building that you may not notice unless you take a look up above you as you walk down west Hastings - (Jameson House) 838 W Hastings St, Vancouver, BC V6C 1C8 - There is one available unit listed at the moment around 4mil! World class builders foster and partners who have have years of experience and projects on the go and under their belt.

The project involves the restoration of the A-listed Ceperley Rounsfell Building of 1921- returning the entire internal double-height volume to its original configuration - and the retention of the facade of the B-listed Royal Financial Building, which dates from1929. The new tower comprises eight storeys of offices above shops and twenty-six storeys of apartments. The tower's form articulates the different functions that the scheme brings together. The first two storeys continue the row of shop units at street level, while the uppermost office floor aligns with the cornice line of the adjacent building. In contrast to the smooth facade of the offices, the apartment floors curve outwards in four wide bays, which are stepped vertically to provide shade and uninterrupted mountain views. The plan supports a variety of apartment types and spatial arrangements, with the living spaces focused on the deep curve of the window bays. All the apartment interiors have been designed by the practice, with variations of Foster kitchen and bathroom fittings. At the top of the tower, penthouse apartments are arranged over two storeys and feature landscaped roof terraces.

What are your thoughts on this building? Have you noticed this building as you walked through downtown west Hastings?

A night out on the town!

My passion for food is the same passion I have for real estate. I love the design, the visual appeal of when it doesn't just look good but when all the pieces work seamlessly or in this case taste amazing together and look fabulous! 

I plan to go into 2018 looking for great well designed places and also at the same time post great fun spots to go out and enjoy when you don't want to be cooped in at home say on a rainy day! I hope you will be apart of the conversation and add to the dialog as I grow and develop in not only the real estate market! I hope you all will be apart of this great Journey I am embarking on!

To start off if you are looking for a great place to celebrate that special moment? Heres my pic for the day! It's no Hogwarts... but close enough :)Hawksworth Resturant ( Four-time winner Best Upscale Restaurant in Vancouver, showcasing ingredient led, contemporary cuisine that has become Chef David Hawksworth's trademark. Often rated amongst the best in Vancouver, resides in the intricately renovated Hotel Georgia (cool info for the history buffs: first opened in 1927). Resturant opened in 2011 #resturants #vancouver#downtownvancouver #jhrealestate#focusingondowntownvancouverrealestate
#condo #newbuilds #presales

Love to hear your choices for a good night out in the comments below! Lets exchange lists

Perhaps end the night strolling down Vancouver's sophisticated business district through to the Victorian buildings and cobblestone streets of Gastown. 

Or you can do to the movies! First opened on May 25th 1999, going by the name of Tinseltown 12 and owned by Cinemark, this downtown Vancouver theatre was Cinemark’s only Canadian theatre. Cineplex Odeon International Village plays the big blockbuster hits and the artistic independent films, making it one of Vancouver’s top theatres. Nearby restaurants include: Chileno Grille and Lisa’s Pizza. Best place to park: Free parking underground.

New Changes to Mortgage!


  • Insured Mortgage / High Ratio Mortgage = Less than 20% down payment
  • Non Insured Mortgage / Conventional Mortgage = 20% or greater down payment / equity
  • Bank of Canada Rate = the 5 year fixed posted rate (currently 4.89%)
  • Contract Rate = the actual rate offered by the lender to the consumer
  • Benchmark Rate/Qualifying Rate = Stress Test: Bank of Canada Rate OR Contract Rate +2%, whichever is greater
  • LTV (Loan To Value) = the size of a mortgage compared to the value of the property securing the loan
  • TDS = A total debt service ratio (TDS) is a debt service measure that financial lenders use as a rule of thumb when determining the proportion of gross income that is already spent on housing-related and other similar payments.



Non insured mortgage consumers (buyers with a 20% or greater down payment) must now qualify using a new minimum qualifying rate. The minimum rate will be the greater of the five-year benchmark rate published by the Bank of Canada OR the lender contractual mortgage rate +2.0%.

How does this affect the mortgage consumer with a down payment of 20% or more?

The biggest impact will be on the amount in which the homebuyer will be able to qualify. Previously, the homebuyer qualified at the rate offered by the lender. Now, the homebuyer must qualify at the benchmark rate which is the higher of the Bank of Canada Rate (currently 4.89%) OR the rate from the lender plus 2%. This applies to all terms, fixed and variable rates.

The stress test for non-insured mortgages applies to both fix rate andvariable rate mortgages. On variable rate mortgages, the rate at time of funding is based on Canada’s prime rate (presently 3.20%) +/- a given mar-gin. Today’s average variable rate is prime – .45% (3.20% is prime – 0.45%) = 2.75%. So applying the stress test of the greater of the two qualifying rates; Bank of Canada is 4.89% and the actual rate of 2.75% + 2% = 4.75% thus the BOC would be the qualifying rate to use since its higher

For example:

Mortgage Amount $400,000If Your Contract Rate is 3.44%Benchmark Rate 5.44% (3.44% + 2%)

Monthly Payment$1,985.00$2,427.00

Minimum Income*$70,000$85,000

*The chart above is based on 35% GDS RATIO (Gross Debt Service Ratio) and a 25 year amortization.

Do I still have the option to refinance my home?

Yes, homebuyers will still have the ability to refinance up to 80% of the value of their property. You will have to pass the same stress test which is the higher of the Bank of Canada Rate (currently 4.89%) OR the rate from the lender plus 2%.



Homebuyers/owners qualify for a mortgage using the benchmark rate, which is the Bank of Canada rate (currently 4.89%) OR the lender rate +2%, whichever is greater.


You must qualify for a mortgage at the Bank of Canada rate (currently 4.89%)


Mortgage lenders (excluding credit unions and private lenders) must establish and adhere to appropriate LTV ratio limits that are reflective of risk and updated as housing markets and the economic environment evolve. We are awaiting more details on this policy from lenders. As we have new information, we will update this document.

What does this mean?

OSFI directs lenders (excluding credit unions and private lenders) to have internal risk management protocols in higher priced markets (sometimes called “hot real estate markets” like Toronto and Vancouver). This is a continuation of a policy already in place. Many mortgage lenders have been following the principles of the policy for the last 10 to 12 months.


Mortgage lenders (excluding credit unions and private lenders) are prohibited from arranging with another lender: a mortgage, or a combination of a mortgage and other lending products, in any form that circumvents the institution’s maximum LTV ratio or other limits in its residential mortgage underwriting policy, or any requirements established by law. This is often referred to as “bundling” or “bundle partnership”.

What does this mean?

For example: a consumer applies for 80% LTV mortgage and the lender can only approve 65%. The lender then partners with a second lender for the additional 15%. The original lender then “bundles” the 15% LTV mortgage with the original 65% mortgage to form the complete 80% LTV loan. This is no longer permitted as per OSFI.


Now, more than ever, new homebuyers and existing homeowners are going to rely on mortgage brokers for their guidance and expertise in navigating through these regulatory changes.

There are differences amongst the many lenders that we have access to and the greatest value a broker can provide is the knowledge of the lending environment and in choosing which lender is best suited for your needs.

I will continue to educate and post new information in that regard as new data arises. This way you can be kept up to date with all of the latest information. The content in this document is current as of the date at the top of page 1.