Abbotsford Real Estate

Selling Your Home? Plan Your Marketing

2010-04-27T03:23:00Z

How can I get the most $$$ "in my pocket" from the sale of my home? If you are like most folks "highest possible $$$ amount in your bank" is your goal when you are selling your home. How do you find buyers for your home?

There are 2 well known facts about how home are sold:

FACT#1 - Most homes are sold by REALTORS (Some studies say 9 out of 10 homes are sold by REALTORS) because:

- Realtors have a client base
- Realtors have marketing and negotiation skills
- Real estate professionals can protect the sellers and buyers from legal liabilities
- Realtors use the Multiple Listing Service and remuneration sharing agreements to promote your home

Interview more than one agents before you list your home for sale. Ask them what marketing plan do they have to sell your home. Check referral, verify marketing claims, do your homework before you sign a listing contract.

FACT#2 - Most Buyers start their home search online (90% Buyers look online according to National Association of Realtors in the US. Canadian numbers should be similar) because:

- Buyers can search for home from the comfort of their own living room.
- Have access to latest listings
- Buyers can view more photos and even video & virtual tours online
- Buyers have access to other local information like maps, schools and other city data

When you list your home with an agent make sure they offer a marketing plan to promote your home not only through traditional channels like MLS, yard sign, ad in the local paper and in-office promos etc. but also on the Internet.

Most real estate agents have websites but having a web-page is simply not enough. A search for "Abbotsford Real Estate" on Google returns almost 1 million web-pages. So make sure you ask some questions. How many visitors (potential buyers) come to the agent's website every day? Is the agent's website the only place where they advertise your home online? How about other popular destinations on the web like Facebook, twitter, craigslist, househunting etc etc.?

If you are selling your home in Abbotsford, Call us to set-up an appointment for confidential consultation and view our marketing plan. Click here to contact us.

BC HST: How it applies to homes

2010-04-25T18:22:00Z

On July 1, 2010 HST - a combination of the 7% Provincial Sales Tax (“PST”) and the 5% federal Goods and Services Tax (“GST”) - will become effective. If you are thinking of buying or selling a home in British Columbia you are certainly concerned about the HST. Here is some basic information about how HST will apply to new and resale homes in British Columbia.

HST on resale homes:

There is no HST on resale (pre-owned) homes. You can expect to pay HST on items such as home inspections, appraisals and Realtor fees and other such services.

HST on new homes:

HST will be payable on the sale of all new or substantially renovated homes, where the Contract of Purchase and Sale was entered into after November 18, 2009 and both ownership and possession of the home is transferred after June, 2010.

If you signed the Contract of Purchase and Sale prior to November 18, 2009 or if the ownership or possession of the home is transferred before July 1st, 2010 no HST is payable.

And oh yea, there is that rebate too:

The Rebate is 71.43% of the provincial component (remember GST + PST = HST) of the HST paid, up to a maximum of $26,250.00.

*** And if you have listed and sold property in the transition period, you have to calculate how much work was perfomed before and after July 2010 to calculate HST on Realtor fees.

Here is some information in official language.

Click here to visit HST page on BC Govt website.

Buying Abbotsford Tax Sale Properties....

2010-04-25T06:40:00Z

Someone called me last week and asked about properties being sold by City of Abbotsford because of tax deliquency. Here is some basic information for all of you who are curious about tax sales.

The City is required by the Local Government Act to sell, at tax sale, all properties for which taxes have not been paid for three years. The Local Government Act gives the Collector authority to sell a property for the "UPSET PRICE", which equals all outstanding taxes + penalties + interest + 5% tax sale costs + Land Title Office fees.

Tax sale is conducted every year on the last Monday of September. The Collector offers properties - on which taxes are delinquent - for sale by public auction. Notice is published prior to the tax sale advising of the time and place of the sale. Check the local papers and city website for these notices.

On the day of the auction, subject property is sold to the highest bidder above the minimum bid which usually equals to the amount of delinquent taxes plus any penalties and interest. If there is no bid, or no bid equal to the minimum set price, the local government is declared the purchaser.

Within one year from the day of the tax sale, the sold property may be redeemed by the owner, an owner of a registered charge against the property (IE: the lender), or by another person on behalf of the owner or registered charge against the property.

On redemption of a property, the purchaser is entitled to receive refund of all amounts paid by the purchaser, together with interest to the date of redemption at the rate prescribed in the Taxation (Rural Area) Act.

In the unlikely event a property is not redeemed within the redemption period, the Collector registers the new owner with the Registrar of the Land Title Office. It is very rare that a property will change hands as a result of a Tax Sale, as either the property owner or mortgage holder usually redeems the property within the prescribed period.

Calculating BC Property Transfer Tax

2010-04-18T22:46:00Z

When you purchase real estate in British Columbia the amount of the Property Transfer Tax payable is 1% on the first $200,000 of the property's fair market value and 2% on the remaining fair market value. The tax is calculated on the selling price of a property but if the transaction does not reflect fair market value (IE: the transfer of property is taking place without the exchange of money) the tax is charged on the fair market value.

Here is how you calculate BC Property Transfer Tax:

If the fair market value of the property is $150,000, the tax payable would be $1,500

$150,000 x 1% = 1500

If the fair market value of the property is $350,000, the tax payable would be $5,000

1% on the first $200,000.00 = $2,000
2% on the remaining $150,000.00 = $3,000
$2000 + $3000 = $5000

First Time Home buyers do not have to pay Property Transfer Tax if the fair market value of the home they are purchasing is under $425,000.(under current rules, at the date of this post). Purchaser and property must meet certain criteria to qualify for this exemption.

First Time Home buyers can qualify for for partial exemption if the fair market value of the home they are purchasing is between $425,000 and $450,000

Click here to see requirements to qualify for First Time Home Buyers Program. Also click here to view Tax Bulletin from Ministry of Finance

Click here to see more examples of how partial Property Transfer Tax is calculated.

Click here visit website of Govt. of BC about Property Transfer Tax

Mortgage Rules Have Changed. Effective April 19th

2010-02-16T19:58:00Z

Govt. of Canada changed some mortgage rules today to make it a little harder to get a new mortgage or refinance an existing mortgage. There are 3 changes in rules aimed at home buyers, investors and borrowers who may be planning to refinance.

Home buyers will need to meet qualifying criteria for a five-year fixed rate mortgage even if they opt for a lower rate and shorter term or a variable/adjustable rate mortgage. This change is aiming to prevent mortgage defaults in case of interest rates rise in future.
Maximum refinancing allowed will be 90% of the equity in your home, a 5% drop from 95%. This change is aimed at keeping more equity in the home and and build a bit of a cushion just in case prices go down.
A minimum down payment of 20 per cent will be required to purchase rental properties. This is a huge change from 5% down-payment requirement under current rules. This change is aimed at preventing speculation in Canadian housing market.

So what do these hurdles mean for you?

#1 is not a major chnage. Most lenders already use a fixed rate for qualifying you for a variable rate product. The change is going to less than 1% of the 3year fixed rate currently used by major lenders. You will still qualify for a mortgage but for a lesser amount.

#2 if you have lots of credit card debt and little equity (less than 10%) in your home, you will not be able to refinance and pay off the high interest debt. You are also out of luck if you were planning to buy a fixer-upper and rent it or fix-it-n-flip-it. You need more than 90% equity in your existing home if you are relying on refinancing.

#3 This is a big one. You need 20% down payment to buy rental homes. CMHC will not insure your mortgage if you have less than 20% down-payment. You will still find lenders willing to lend with less than 20% down but those uninsured/self-insured mortgages usually have higher fees and interest rates.

***The cost of getting a mortgage is still the same. Interest rate remains unchanged.

You may need more down-payment next year.

2009-12-21T21:32:00Z

Canadian Govt is considering plans to make it harder for Canadian to buy a home. Finance Minister Jim Flaherty says that conservatives in Ottawa may tighten mortgage eligibility rules to avert a possible housing bubble. The government and Bank of Canada are worried that when interest rates rise upto 10% homeowners may not be able to keep up with the higher mortgage payments. In the coming few months the downpaymnet and amortization requirements may change for the borrowers. Right now you can get a CMHC insured mortgage with 5% downpayment and with upto 35 years amortization to lower the monthly payments. Its not clear what the new rules are to be but a higher downpayment requirement will keep lots of first time buyers out of the housing market.

Court sides with consumers, home inspector ordered to pay for negligence

2009-11-12T06:39:00Z

Last April it became mandatory for anyone offering house inspection services in BC to be licensed and this week a home inspector was ordered by a BC supreme court judge to pay nearly $200,000 in compensation to his client. The BC supreme court's decision will have long term implications for newly organized home inspection industry.

The B.C. Supreme Court has ordered a home inspector to pay $192,000 in compensation to a North Vancouver couple for a faulty home inspection he performed. Home inspector's report estimated house repairs would only cost about $20,000, when in fact they totalled more than 10 times of the estimated amount. The judge found the buyers wouldn't have purchased the home had they been made aware of the extensive rotting beams and other structural problems.

Most licensed home inspectors are professionals but consumers must do their due diligence before hiring anyone because home inspection is very important part of the home buying process.

Abbotsford Homes Sales Monthly Report: October 2009

2009-11-04T20:51:00Z

Buyers moving in from Greater Vancouver and first-time buyers from all over the Lower Mainland taking advantage of competitive interest rates and lower prices in the Fraser Valley were the driving force behind strong home sales in October. Although Fraser Valley’s MLS® received 7 per cent more new listings in October than it did in September, the strength in October’s sales reduced overall inventory. In October 2009, Fraser Valley home buyers had 8,807 listings to choose from, compared to 11,715 in October last year – a decrease of 25 per cent.

In Abbotsford, Single family homes was the strongest segment of the overall housing market. Almost 4 single family homes changed hands every day which is 100% increase over October 2008. About 60 single family homes were sold in October 2008. Townhomes and apartments also enjoyed higher sales.

Take a look at the chart displaying home sales comparison between Oct 2008 and Oct 2009:

Abbotsford Homes Sales Monthly Report: August 2009

2009-09-04T22:04:00Z

After a very hot July home sales in Fraser Valley set another record in August recording the second best August for home sales. Buyers powered by historically low interest rates and driven by the desire to move up the value chain drove the home sales to record levels.

In Abbotsford single family home sales were 86% higher than August of last year while town-homes recorded an increase of 34.3% in number of sales when compared to August 2008. 41% more Apartments were sold last month than August of 2008. Prices and number of listings were both lower than last year but detached homes did record a slight increase in prices from July 2009.

Take a look at the chart displaying home sales comparison between Aug 2008 and Aug 2009:

Speak out against HST on new home sales & real estate services in BC

2009-08-27T05:25:00Z

Last month when BC govt. announced the plans to implement new tax system HST (harmonized sales tax) in 2010, I wrote a blog post about how it would affect the real estate industry and new home buyers. Just like me most other REALTORS® are concerned that home buyers and sellers, particularly buyers of new homes, will bear most of the burden associated with the proposed Harmonized Sales Tax.

The BC Real Estate Association has launched a new website to provide REALTORS® and members of the public with a convenient way to send a letter directly to the BC government to express their opposition to the proposed Harmonized Sales Tax (HST). This website also provides information about the tax, including the answers to frequently asked questions (FAQs) and links to media coverage.

Click here to visit this website and learn more about HST and how it can hurt home buyers (and sellers) especially when applied on top of PTT (Property Transfer Tax). Don't forget to send a letter to Gordon Campbell and other ministers. Don't give up, we still got time to make a change.

The hottest July on record

2009-08-05T21:04:00Z

July was indeed the hottest month in Fraser Valley for both weather and real estate sales. The hot weather and home sales both broke the all time record for month of July.

Fraser Valley saw the highest number of real estate transactions ever recorded for the month of July and mercury hit 38 degrees, beating the former all-time record of 37.9.

There were 2,089 sales processed on the Fraser Valley Real Estate Board's Multiple Listings Service® (MLS®), an increase of 62.3 per cent compared to 1,284 sales in July of last year. The previous highest July was in 2005, with 2,051 sales.

Low interest rates, home prices that are lower than last year by about 6 per cent and a surge of first-time home buyers were driving the housing market. And for heat wave, you can always blame the "global warming".

No more interest free loans for leaky condos in BC

2009-08-02T15:08:00Z

Owners of leaky condominiums in British Columbia built poorly during the building boom of the late 1980s and early 1990s would no longer be eligible for government funded interest free loans to repair their buildings. The B.C. government has put an end to a leaky condo loan program, saying a levy on new residential projects that funded it has dried up.

The program was established as consumer advocates called on the government to foot the entire bill for the leaky condo repairs because building codes and regulatory programs were blamed for the problem.

Homeowner Protection Office started lending money to leaky condo owners 11 years ago and stopped accepting applications last Friday. About 16000 people are said to have benefited from this interest free loan program which funded over $670 million in the last 11 years. There may not be as many leaky condos out there today but the ones with a leak problem will feel the pinch.

What HST means for BC real estate

2009-08-01T07:31:00Z

The BC government announced on July 23, 2009 that effective July 1, 2010, BC will adopt the HST, combining BC's seven per cent PST with the five per cent federal GST for a single "harmonized sales tax" of 12 per cent.

Starting next July, we'll be paying a combined 12 per cent on most purchases. The biggest problem with the proposed HST is that it will no longer exempt all kinds of goods and services from the seven per cent provincial sales tax.

The proposed HST will significantly affect home buyers of both new and resale homes. Infact the biggest tax hit could be on those who buy new homes, which were previously exempt from the PST but not the GST.

A person buying a $450,000 resale home will pay over approximately $1,100 more due to the new tax applied to real estate transaction fees. On a $750,000 newly constructed home, a buyer would pay approximately $32,500 more in tax, even with the proposed $20,000 HST rebate on homes over $400,000.

Consumers will have to pay a higher tax on new houses, renovations, REALTORS®' fees and other real estate transaction fees such as notary services, home inspections and appraisals. All of those are currently exempt from the PST and are only subject to the GST. Under the new proposal, they will be subject to a 12 per cent HST tax.

A number of items will still be exempt from the PST portion of the new tax: gasoline and diesel fuel for vehicles, books, children’s clothing and footwear, children’s car seats and car booster seats, diapers and feminine hygiene products.

Why can't we add real estate services to the above list of items that are exempt from the PST portion of HST? Why there was no consultaion with such an important industry group before imposing a huge tax burden? Is this housing market not slow enough for BC Liberals?

Folks, contact your local MLA and ask these questions....

Save water - show homes in dirty cars

2009-07-26T23:03:00Z

A good excuse for driving around in dirty car: local reservoirs have dropped to “dangerously low” levels and the City of Abbotsford will ban lawn watering, vehicle washing and similar activities as of Tuesday July 28. The sprinkling restrictions had been working so far but the city is making an attempt to keep enough water in the secondary reservoirs for fire emergencies. Even without the sprinkling ban, Abbotsford residents are still only allowed to sprinkle their lawns from 6 a.m. to 8 a.m. on certain days.

UPDATE: Ban lifted as of August 25th, no more excuses for dirty cars.

Changing Lockboxes - Supra to SentriLock

2009-07-26T22:03:00Z

Fraser Valley real Estate Board will be changing lockbox suppliers to the REALTOR®-owned company Sentrilock. This change is scheduled to occur when the Board’s contract with the current supplier, GE Supra, expires this October. The Greater Vancouver and Chilliwack real estate boards will also make the change to SentriLock.

So be patient with your REALTOR during this period of transition. There may be some delay in putting a lockbox on your property in the first few weeks. Once every one is comfortable using new lockboxes and supply becomes steady, things should be back to normal.