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UPCOMING CHANGES FOR CONSUMERS WHO ARE BUYING OR SELLING -
 

Mr. Michael Noseworthy, the Superintendent of Real Estate has given directions to the Real Estate Council of B.C. [RECBC] to implement changes that are supposedly for the protection of buyers and sellers. These changes are to be effective on March 15th, 2018.
 
We all know that Limited Dual Agency will be forbidden come March 15, 2018 as well. This means there is a ban on one REALTOR® representing a buyer and seller in the same transaction. Okay, we get it.
 
However, one of the major concerns to REALTORS® is the new rule with respect to what is called "double recusal".
 
Recuse means "to remove oneself from participation to avoid a conflict of interest."
 
Here is an example of how "double recusal" could apply if you are going to sell your house.
 
You, the sellers have decided on offering your home for sale with REALTOR® Mr. Agent.
 
You interviewed three other REALTORS® and after serious consideration you selected Mr. Agent to represent you. 
 
Mr. Agent was highly recommended to you; has been in the profession for over 25 years, has a huge clientele base since his business is built on referrals from satisfied buyers and sellers and knows everything about the neighborhood where your home is located. He is perfect to represent you and you trust him.
 
You told Mr. Agent what you were hoping to sell your home for, you agreed to his marketing plan, you told him all your personal information, why you were selling and what you hoped to buy. You told Mr. Agent your mortgage amount owing and other confidential information.
 
You chose Mr. Agent because of his ethics, his professionalism, his negotiating plan and abilities. You trusted Mr. Agent and wanted him to represent you in the sale of your most important asset, your home.
 
You then asked Mr. Agent if he had any buyers in his clientele list that might be interested in buying their home. This is where the concern for the consumers comes into play.
 
Mr. Agent tells the sellers that yes, in fact he does have a couple that he just sold their home and he also knows another buyer that might be really interested as well.

HERE IS WHERE THE PROBLEM EXISTS

Mr. Agent must tell the sellers that he cannot represent either of his possible buyers because he also knows all the buyer's personal information. Remember, he also knows all your confidential information. It is called "double recusal" [avoiding a conflict of interest re confidentiality].
 
The new rules state that Mr. Agent cannot represent you as the sellers and the potential buyers he knows, because he has confidential information about both parties.
 
He will however, recommend the buyers to another REALTOR® to represent them.
 
This is all good unless these buyers really do want to make an offer on your home.
 
They have seen many other houses for sale but now they love your home. They want their referred REALTOR® to make an offer on your property.
 
Here's where it gets very complicated under the new rules and where you as sellers and/or buyers cannot choose your own representation for your real estate needs.
 
You hired Mr. Agent to represent you with the most important and complex transaction of your life.
 
The primary agency duties Mr. Agent must uphold always are: loyalty, avoiding conflicts of interest, full disclosure and confidentiality. 

The one duty that never expires is the continuing duty of confidentiality. 

These new rules will take away the consumers choice of representation in the sale/purchase of their real estate.
 
Because Mr. Agent knows you and your confidential information if the REALTOR® representing the buyers brings you an offer on your home --- according to the new rules, there is the problem of a conflict of interest. Mr. Agent knows both parties confidential information.
 
The rules mean that when the Buyer's REALTOR® presents an offer, Mr. Agent is required to step away from representing you, the sellers. 
 
That's right; Mr. Agent cannot represent you the sellers because of the supposed conflict of interest. 
 
Is that allowing you the consumer, to choose who represents you?
 
Even if you as sellers signed a disclosure that Mr. Agent does have confidential information, but he will not share that with you the sellers; that will not be allowed. He would still not be able to represent you.
 
Well, what if we even had the buyers sign they are okay with their referred REALTOR® representing them and to go ahead with Mr. Agent representing the sellers. No, this is still not allowed.
 
So now you the sellers must wait until the Brokerage of Mr. Agent appoints another designated agent to step in for him.
 
Yes, you had hired Mr. Agent based on his knowledge, professionalism, ethics, recommendations, trustworthiness and most importantly on his negotiating skills to help bring you the highest offer possible. You have no option or choice of who can represent you if Mr. Agent also knows confidential information about a prospective buyer.

Did you know this was coming into effect March 15th, 2018?
 
How do you feel about not having your own choice of who works for you when you are buying or selling?
 
The new rules are stating that you the sellers who hired Mr. Agent will now have to change to another REALTOR® who you do not know - how are their negotiating skills, what do they know about you and your concerns. 
 
This is the most critical negotiation of your lifetime and you cannot have the REALTOR® you originally contracted with look after your needs, negotiate on your behalf and explain step by step what is involved.
 
If there are subjects Mr. Agent won't be allowed to advise you on their validity in the sale of your home; the length of time allowed for the subject removal, the date of closing [the day you get paid] - does it meet your needs and is there enough time between being paid and moving out to allow you to pay for the new home you are purchasing. 
 
What if there is an unauthorized suite that needs to be disclosed properly to protect both the sellers and buyers - does this new 'fill-in' agent know all about this?
 
Sure, let's just change your representative in the middle of the most critical part of selling your home.
 
Demanding Mr. Agent step aside from the negotiations because he may know some 'confidential' information about the buyers is a total disservice to you.
 
This newly appointed REALTOR® most likely knows nothing about the listing information and nothing about you the sellers - how is that protecting you? Who is looking after you - you chose Mr. Agent to represent and protect you throughout the sale of your property but due to the new rules you have absolutely NO CHOICE in the matter?
 
How is this fair to any members of the public?
 
This proposed new rule being brought down by the Superintendent of Real Estate and implemented by the Real Estate Council of B.C. eliminates the public's choice of representation. Are you okay with it?
 
Please voice your comments/questions/concerns to the following regulatory bodies.
 

RealEstate@gov.bc.ca ATTENTION: MR. MICHAEL NOSEWORTHY
 
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For the 70% of Canadians who own a home, it is a place to live, raise a family, and connects them to their community. 

Due to Canada’s tax system’s Principal Residence Exemption, when we sell our homes, any increased value or “capital gains” are not taxed. 

This tax break matters to Canadian homeowners. Collectively, we have about $3 trillion in home equity and our homes are often our largest financial asset. 

However, starting with 2016 income tax returns, there are some changes in how homeowners qualify for the Principal Residence Exemption. 

Until now, the Canada Revenue Agency has not required Canadians to report on a home sale during a tax season. However, if you sold your home in 2016 or later, you will need to complete a Schedule 3, Capital Gains of the T1 Income Tax and Benefit Return in order to report your sale. 

The good news is that, in terms of taxes, nothing has changed. The same tax benefit is available to anyone who sells their home, provided the property was the principal residence for every year you owned it – even if you use part of your home for business purposes. There is no “new tax” involved, only a requirement you report the sale details on your tax returns.

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Foreign nationals with Canadian work permits coming to BC through the BC Provincial Nominee Program can now be exempt from the 15 per cent additional Property Transfer Tax (PTT) (known as the foreign buyer tax) when they buy a home. The exemption began March 17, 2017.

The foreign buyer tax took effect August 2, 2016. It originally applied to all foreign buyers, defined as foreign nationals and foreign corporations who are neither Canadian citizens nor permanent residents, buying residential property in Metro Vancouver, excluding treaty lands in the Tsawwassen First Nation.

Existing BC provincial nominees who bought a principal residence on or after Aug. 2, 2016, can apply for a refund. Application forms are available on the government’s website.

The Province is also extending rebates of the additional PTT to foreign nationals who became permanent residents or Canadian citizens within one year of purchasing a principal residence.

Foreign nationals working in BC who are not BC Provincial Nominees, such as those in the Canadian Federal Skilled Worker Program, are not entitled to the upfront exemption.

“British Columbia has always welcomed the world’s best and brightest, where they find a place that embraces them,” said Premier Clark. “Our growing tech sector depends on the Provincial Nominee Program, and that’s why we’re removing barriers, so they can get to work, create jobs, and help build B.C.”

All buyers of residential property in BC pay the PTT at a rate of a one per cent tax on the first $200,000 of their purchase, two per cent on the remaining value up to $2 million, and three per cent on the portion above that. The foreign buyers tax is a 15 per cent tax in addition on the whole value of the property.

Learn more or phone 1.888.355.2700

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The BC Minister of Finance has announced several changes to the Property Transfer Tax program, effective Wednesday, Feb 17th, which include:

 

  1. A property transfer tax exemption for Canadian citizens and permanent residents who purchase newly-built homes, condos and townhouses under $750,000. Purchasers must live in the property for at least one year. This is a potential savings in closing costs of up to $13,000.
  2. 1% increase in property transfer tax to 3% for homes which are sold over the $2 million mark.
  3. Buyers will need to start disclosing their country of residence in all property transactions.
  4. The beneficial ownership of properties held by corporations will also be tracked.

 

*The first time home buyers exemption will remain in place for all homes under $475,000

 

This change will encourage a number of buyers -- both first-time and repeat -- to jump off the fence and into the market. Repeat buyers now get an exemption on new builds up to $750,000. This is good news and will likely stimulate the move up buyers to look around as a $13,000 cash expense has just been removed from the process of moving from one property up to a larger, nicer, brand new place.

On the flip-side of the changes, however, are purchasers of luxury homes. Under the new changes, they will pay higher land transfer fees. A client purchasing a $4,000,000 home is not slowed by a $20,000.00 increase in purchase taxation; they will still pay the four million.

 

Also, good news is the tracking the country of residence in all property transactions. Expect changes from the board in the next few weeks.

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An entire city block is up for grabs for $28-million in Vancouver’s upscale Kerrisdale neighbourhood, providing a glimpse into what a difference zoning makes when determining land values.

Since HQ Commercial posted the listing late Friday night, it has created a buzz in the city’s real estate circles. The asking price for the commercially zoned “C-2” block works out to $357 a square foot of buildable space or $893 a square foot of land.

 

David Goodman, a principal at HQ Commercial, expects the Kerrisdale property will attract bids from developers interested in constructing a four-storey condo complex after demolishing the five aging two-storey rental buildings on the site.

 

The assessed value of the entire property totalled $15.9-million on July 1, 2013, according to BC Assessment. The city block has enough room to fit in 10 single-family detached homes if they each were to have skinny 26-foot frontages. But the $28-million asking price reflects HQ Commercial’s belief that the land will be attractive to developers who could design ground-floor businesses such as a grocery store and restaurant, while saving the top three floors for condos.

 

Industry experts say that demand from new arrivals migrating from other provinces and countries, notably China, are part of the reason real estate prices have soared over the past 15 years. But on the supply side, Mr. Goodman is scratching his head and wonders why the City of Vancouver has effectively placed a moratorium in recent years on demolishing old rental apartments, unless a site happens to be already zoned like the Kerrisdale block for commercial development.

 

Mr. Goodman said the Kerrisdale property sale isn’t a case of renters being cast adrift unfairly in future because the tenants used to be suite owners as part of a co-op arrangement dating back many years. There are 44 units spread over the five buildings on the site, including 14 one-bedroom suites and 30 two-bedroom units. Many residents received premium prices for agreeing to relinquish their units for more than $350,000 each, while those who owned larger suites fetched the most money

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Disagreements over land use in Vancouver have led to delays in bringing on new housing, which in turn restricts supply and puts upward pressure on real estate prices, experts say.

 

Just a stone’s throw away from the Kerrisdale property is a stretch of land that is part of Canadian Pacific Railway Ltd.’s right-of-way for a now-abandoned freight route known as the Arbutus Corridor. The City of Vancouver’s zoning for CP’s 11-kilometre path is for a transportation corridor. By that definition, Mayor Gregor Robertson reckons that the railway’s property that snakes through some of Canada’s priciest neighbourhoods is worth perhaps $20-million in total. That works out to $10.68 a square foot – the City of Vancouver’s low-ball offer to CP.

 

Hunter Harrison, CP’s chief executive officer, figures a more realistic value would be at least five times higher to total $100-million at a minimum, or beyond $400-million on the higher end of the appraisal range based on adjacent land. CP recently took out full-page newspaper ads, featuring an open letter from Mr. Harrison to press his case that the City of Vancouver is trying to acquire the right-of-way for a song.

 

Some observers are puzzled by Mr. Robertson’s opposition to developing the Arbutus corridor while he supports increased density elsewhere, such as laneway houses popping up all over the city. Those are the small homes built next to alleys in the spot where the garage would normally be located.

 

The Arbutus Corridor is a good case in point to highlight the difficult and sensitive nature of what to do about vacant land in a city starved for development space. Many Kerrisdale residents want civic leaders to preserve the lengthy strip of track as a greenbelt for the foreseeable future. Civic officials have mulled over the possibility of using CP’s right-of-way in the long term for passenger light-rail transit, but so far, have ruled out zoning for residential development.

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Visit a participating CENTURY 21 open house on May 24 or 25 and fill in the contest entry form!

 

View complete contest terms and conditions

 

The “Open House Weekend Blitz” contest (the “Contest”) is open to individuals residing in Canada only, excluding individuals residing in the province of Quebec, who have reached the age of majority in the province or territory in which they reside.The Contest commences at 12:00am PST on May 24, 2014 and concludes at 11:59pm on May 25, 2014 (the “Contest Period”). In order to enter the Contest, eligible individuals must visit a participating CENTURY 21 Canada System open house during the Contest Period and sign in (fill in the contest entry form) during the Contest Period.By entering the Contest, entrants automatically agree to be bound by the complete Contest Terms and Conditions, which are subject to change without notice to Contest entrants individually.

 

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Located in the common area shared by the Olympic Village’s Community Centre, the Salt Building and retail floor spaces is a plaza where it will become a people’s gathering place for the entire Southeast Falsecreek area.

Here out in the plaza, you will also find Vancouver artist Myfanwy MacLeod’s two larger-than-life sparrows (or ‘The Birds’) painted with the true colors of the small bird that was introduced to North America from England in the 1800s.

Since then, sparrows have multiplied so much that they crowded out other native species, upsetting the ecology and biodiversity of the continent. MacLeod’s pair of giant sparrows (one male and one female) are 18 ft. tall and they dwarf visitors to the plaza.

The sculptor said the idea of making the small bird bigger was to underline the message that when a foreign specie is introduced, it could wreak havoc upon the native eco-system and make us aware of the interdependence of nature. MacLeod’s message couldn’t be more appropriate for the Southeast Falsecreek site which was an industrial wasteland that was very much polluted before the Olympic Village was built.

In developing the Millennium Water project, special attention was paid to environmental impacts, both in the past and in the future. The whole site was designed to follow LEED Gold and Platinum guidelines. An artificial man-made Habitat Island was also created to encourage the growth of habitat both on land and in the water.

It was recently discovered that herring eggs are beginning to appear in the once dirty Falsecreek shoreline. Not co-incidentally, the Olympic Village was recognized as the World’s Greenest Neighborhood.

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Mainland Chinese investor buyers have all but disappeared from Vancouver’s real-estate marketplace, and their unexpected departure has left many developers, real-estate agents and construction trades with postponed plans and shelved strategies.

The sudden absence of the once-omnipresent Chinese investor has also meant no media photo ops of buyer lineups and a softening market in metro Vancouver.

It’s my opinion, however, that when mainland Chinese buyers return to Vancouver it will be a feeding frenzy due to pent-up demand. And they could return as soon as the next six to 12 months, depending on when – not if – the Chinese government changes its tight mortgage-lending policy. The People’s Republic of China is slated to name a new leader in 2013 and historically every change in leadership brings with it new policies to create its own legacy. Of course, the Chinese government is not democratically elected by the people, meaning they get to do whatever they want, whenever they want, without civic input.

Here’s a little background: Vancouverites consider real-estate prices high, but in China during the first decade of the new millennium they were astronomic. So in 2009 the Chinese government introduced a policy designed to cool investor speculation in real estate while allowing ordinary citizens to buy their own home. This policy stipulated that buyers could purchase their first home with 30 per cent cash down, but if they bought a second property it would require a whopping 60 per cent down payment. That move halted the investor market in China and prices dropped by 30 to 40 per cent in major centres such as Beijing and Shanghai.

While it did allow many citizens to buy their own home, it also greatly reduced the amount of cash investors had to invest in real estate. If you’d just lost 40 per cent of the cash value of your Guangzhou condo, why would you buy two more in Burnaby?

Last Chinese New Year is when Vancouver real-estate developers and marketers first noticed the absence of the mainland Chinese buyer, as this is typically when they visit Vancouver and go on a shopping spree. But they went missing this past February, a telltale sign that the government’s strict policy was working and that the overall economy was slowing down.

The reality in China is that the real-estate industry accounts for a hefty 11 per cent of the country’s overall GDP. If you include related industries like appliances and furniture, it increases to between 22 and 25 per cent. The People’s Republic of China simply cannot afford to have the important real-estate industry stall and its economy go sideways, which is why I believe that, in short order, the government will start relaxing the restrictive lending policies, investors will start getting back into the market and, as their assets become more liquid, we’ll see them return to metro Vancouver. When China’s real-estate market returns to brisk buying and selling, many Chinese will once again look for a safe haven to park their newly regained wealth.

Vancouver is poised to become one of the biggest, if not the biggest, beneficiaries of that wealth looking for a new home. When asked why they like Vancouver, many Chinese investors have told me that they prefer to invest here because Vancouver is “safe” and “nothing bad ever happens here.” The sudden rise and fall in real-estate prices we’re seeing now in China, as well as fluctuations in the overall economy, mean that people view investing there as no less risky than placing bets on a baccarat table. It also means that parking money in Vancouver feels to them as safe as investing in treasury bills.

While the policy change has impacted investors’ cash flow in the short term, it hasn’t curbed their enthusiasm for Vancouver real estate. The Chinese government is predicted to have a change in leadership this fall and after that change, I believe, we will see major changes in the country’s mortgage-lending policies and the return, once again, of the Chinese investor.

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The city of Vancouver is working with experienced developers to transform downtown south into an evolving urban village that incorporates a greater use of public spaces, design and architecture.

The whole area will be changing, where current buildings, uses and roadways will undergo a transformation in favor of establishing vibrant, stylish and people-friendly streets. The plans include a new road system to improve walking and biking access to the waterfront and seawall, ease the traffic commute and a new vibrant commercial hub along Pacific Boulevard.

Some of the changes are:

  • 7 new mixed use buildings.
  • Sidewalk extensions to promote future outdoor café and restaurant patios.
  • Improvements to pedestrian areas will mean you can walk to the seawall in minutes.
  • Proposals to innovative cycling amenities include bike parking and potentially repair services.
  • A small, four story office building with new shopping and services on the street.
  • Removal of the “Granville Loops”, curving on-ramps and off-ramps that transfer traffic to and from Pacific Boulevard.

This will increase the current density and soon hundreds of new residents and commercial tenants will call Downtown South home.

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In Surrey, B.C., development company Tien Sher is creating a four-storey condo building home to 56 “micro suites.”

Touted as Canada’s smallest condos, “Balance” units are 290 square feet. But with a price tag of just $109,900 and a prime location in a quiet neighborhood just a few minutes’ walk from public transit, there may be some benefits to investing in smaller space.

Why big investors love small spaces

  • Prime locations that stoke tenant demand
  • Lower purchase costs
  • Higher rent per square foot
  • Smaller units in larger buildings often mean lower condo fees
  • High resale demand driven by investors and end-users

Developer/owner Charan Sethi says the idea stemmed from current market conditions. “This whole project began about a year ago when we had numerous people coming to us wanting to buy, but the mortgage rules and escalating prices shut them out of the market. We wanted to find out what these people are willing to live in, what are their lifestyles, and what are they looking for?”

Finding that prospective buyers and tenants typically don’t own a car, used public transit and would be OK living in a smaller space if it were in the right location, the idea for Balance came about. Sethi is already fighting off investor interest, (“I have someone who wants to buy the entire building already,” he says), but wants to try the project on the open market first. That said, Sethi has nothing against investors purchasing single units; in fact, he fully expects it.

"Investors, in most of my projects, are about 60% of my market. Because investors will make a decision very quickly when there’s pre-sales happening, where an end-user does not,” he says.

And as for the small physicality of the units themselves, Sethi believes there will be no shortage of people willing to make use of them. “These suites have everything these people need – a bedroom area, a kitchen, and laundry facilities. If they use the space properly, they can live very comfortably.”

He points to the Burns Block building in downtown Vancouver as an example. It underwent renovations to spruce up the suites, which are 226 and 291 square feet. They’re now currently being rented out for $850 a month.

“When they first came out, people were complaining they were too small, but in less than a month the whole building was occupied,” says Sethi. Sales are projected to begin in early 2013.

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Construction has started for a 47-inch-wide Polish house that takes the term “hole-in-the-wall” to another, skinnier level.

 

It was reported before on the world’s narrowest house, located in a crack between two buildings in Warsaw, which measures about four feet at its broadest and 27 inches at its slimmest. This architectural equivalent of a corset was designed by Centrala’s Jakub Szczesny for Israeli writer Etgar Keret, who will live and work there when it opens mid-October.

 

Artists and thinkers — hopefully, the non-claustrophobic kind — will stay at the so-called Keret House when its titular occupant isn’t there. Electricity will be provided by nearby buildings; the 150-square-foot house will have a bed, desk, kitchen, shower and an independent, boat-inspired water and sewage system, as well as remote-controlled stairs that can flatten against a wall when not in use. We’re sure that the house would put anyone in a working state of mind, since the frame basically looks like a file folder, and the steel exterior resembles an Apple-designed pill.

 

Pictures below, courtesy of Centrala:

 

 

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