About Linda Klein

DLC Weekly Rate Minder courtesy of Starr Webb

DLC Weekly Rate Minder courtesy of Starr Webb

When homeowners receive provincial Property Assessment notices, some will smile and have a bit more spring in their step, feeling the assessed value is accurate or perhaps even overly positive. Others will wilt and lament a modest gain or even a decrease in the assessed value over the previous year or period. Reactions will of course vary factoring in the potential increase in property taxes that tends to come along with stronger assessments.  The reality, setting aside taxation concerns, is that neither parties’ emotions should be tied to the ‘value’ printed on these notices. 

A provincial property assessment is an approximate value based on the (broadly) estimated market value as of the previous years. There is a lag time between the estimation of valuation and delivery of the envelope. It also fails to involve a formal site visit or viewing of the inside of the home to consider either significant upgrades or significant deterioration.

To put this in perspective, few lenders will work with a detailed official appraisal report that is even 90 days old.  Most prefer a report completed with 30 days, as markets can move significantly month over month.

For these reasons, among others, a provincial property assessment should not be relied upon as a totally concrete indicator of value for the purposes of either purchase, sale, or financing.

Always enlist a licensed professional, or perhaps even two or three, in order to get a timely and detailed appraisal of current market value. This will provide a much more accurate reflection of current market values reflecting recent comparable sales, value for zoning, renovations and/or other unique features to the property.  An appraiser is an educated, licensed, and heavily regulated third party offering an unbiased valuation of the property in question.

Think of your provincial property assessment as something akin to a weather forecast spanning far larger and more diverse areas than the unique ecosystem that is your neighborhood, street, and specific property.

The forecast may call for rain in your city, yet you might have a ray of sunshine radiating upon your street specifically.

Use our Property Transfer Tax Calculator.

The Property Transfer Tax is a tax payable to the Provincial Government by purchasers of real estate. The tax applies to all types of real estate, whether residential, commercial or industrial.

The amount of the Property Transfer Tax is 1% on the first $200,000.00 of the property’s fair market value and 2% on the remaining fair market value. For example, if the fair market value of the property is $200,000.00, the tax payable would be $2,000.00 (1% of $200,000.00). If the fair market value of the property is $250,000.00, the tax payable would be $3,000.00 (1% on the first $200,000.00 = $2,000.00 and 2% on the remaining $50,000.00 = $1,000.00).

“Fair Market Value” is best described as the price that would be paid for a property on the open market (which is usually the actual purchase price paid for the property).

There are a number of exemptions available to avoid this tax, the most common being for “First Time Home Buyers”. To qualify as a First Time Home Buyer, the following criteria must be met:

• Purchaser must never have owned an interest in a principal residence anywhere in the world at any time;
• Purchaser must be a citizen of or a permanent resident of Canada;
• Purchaser must have resided in B.C. for 12 consecutive months immediately before the date they become the registered owner, or the Purchaser has filed two income tax returns as a British Columbia resident within the prior 6 years of becoming the owner;
• To obtain full exemption, the purchase price must not exceed $475,000.00. A partial exemption is available for homes between $475,000.00 and $500,000.00 (see formula below);
• Purchaser must move into the property within ninety-two days after registration of the purchase of the property and reside in the property for at least one year;
• Pro rata exemption where property exceeds .5 hectares or a portion of the property is not residential (i.e. commercial lofts) – purchase price of entire property must not exceed the price limitations.

Other exemptions exist as well, such as a transfer of a principal residence between family members. For details on this and other exemptions, go to http://www.rev.gov.bc.ca/RPT/ and pick the “Property Transfer Tax” button located on the right hand side on this screen.

Property Transfer Tax should not be confused with Property Tax. The Property Transfer Tax is a one time tax paid to the Provincial Government by purchasers of real estate. The Property Tax is the tax paid on an annual basis to the local City/Municipality.

Please remember that the Property Transfer Tax Act may frequently change along with the exemptions for payment of this Tax. While we try to keep our website up to date as much as possible, please do not rely upon the information without talking to one of our lawyers.

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult a lawyer for individual advice regarding your own situation.

Copyright © 2008 by The Spagnuolo Group of Real Estate Law Firms. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement.

RBC cuts mortgage rate, price war coming?
It was always going to happen, but while last week the big lenders were reluctant to pass on the Bank of Canada’s interest rate cut to borrowers, this week there’s talk of a price war. Royal Bank of Canada is the first of the big banks to cut mortgage rates, dropping its five-year fixed rate deal to 2.84 per cent and also cutting its other fixed products. Flexible rates are unchanged though along with other lending from the bank. Of course, these rates are the bank’s published deals and brokers frequently secure better ones, but a ‘battle of the rates’ creating headlines can only help the perception that now is a great time to buy. How low those rates go is anybody’s guess, but there are already predictions of sub-two per cent mortgages.

“GENERAL INFORMATION”

What started years ago as a replacement for a survey certificate has now become standard on real estate purchase or refinance transactions. If you are buying or refinancing your home, expect title insurance to be a requirement of your lender.

What is Title Insurance?

In its simplest form, title insurance protects the lender and homeowner against a number of risks related to the property’s title or ownership.

What does Title Insurance cover?

From the point of view of most lenders, the main coverage is fraud, which can occur in a variety of ways.

With identity theft on the rise, it is not difficult for a fraudster to obtain legitimate identification claiming to be the true owner. The fraudster then deals with realtors and lawyers as if they were the owner, and proceeds to sell the property. Alternatively, the fraudster may work with a lender or mortgage broker, again with identification, to place a new mortgage on the property. In either situation, the true owner is unaware of the fraud and the fraudster absconds with the sale or mortgage funds.

Other typical examples include spousal impersonation and lawyer fraud.

In most cases the Assurance Fund of the Land Title Office may reimburse the true owner, but this may take several months and thousands of dollars in legal fees. Title Insurance is usually quicker and less expensive.

In addition to protecting against title fraud, title Insurance can cover:

a. violations of municipal by-laws;
b. encroachments onto an adjoining property;
c. property tax arrears;
d. existing work orders;
e. lack of legal access to the property;
f. unpaid strata assessments;
g. zoning and setback non compliance;
h. forced removal by a governmental authority of a structure built without a required building permit;
i. legal status of any septic system;
j. gap coverage.

How much does Title Insurance Cost?

For properties with a purchase price under $1,000,000.00, the cost of title insurance is generally $225.00, with $175.00 to the Lender Policy, and $50.00 to the Owner Policy. For every additional $1,000.00 over a purchase price of $1,000,000 the price increases by $0.90.

Unlike life or house insurance, purchasing title insurance is a one time cost, with no annual premium.

Courtesy of Spagnuola Group

Copyright © 2015 by the Spagnuolo Group of Real Estate Law Firms.  All rights reserved.  You may reproduce materials available at this site for your own personal use and for non-commercial distribution.  All copies must include this copyright statement.

When staging a bathroom, it pays to think of some of the most used bathrooms in the world – those in hotels – and model your client’s water closet after that.

“People love to walk into the hotel bathroom and see everything is new and clean and the towels are perfect and everything is lined up,” Ella Zetser of The Last Detail Home Staging, tells REP. “It makes you feel like no one has used it before.”

That fresh tone is what agents should be going for, but how do you get there? Here are eight tips for expertly staging a bathroom.

1 – Remove clutter and clean
As with any room in the house, a good clean and a solid de-cluttering works wonders. Bathrooms, of course, should be spick-and-span and free from knick-knacks and other miscellaneous items.

“[Selling agents] need to remove all the clutter,” Zetser says. “There shouldn’t be anything in the bathroom other than white towels – which reminds [buyers] of a hotel. Make sure it’s clean. All the toiletries should be gone.”

2 – Play up the vanity
When potential buyers walk into a bathroom, the sink and vanity are usually the first things they see, and Zetser says that should be what agents embellish.

“The focal point, usually, is the sink, the vanity,” she says. “That’s where the buyer usually walks in and they’re looking for that. That’s where they’re going to.”

3 – Add flowers
Flowers are the easiest way to brighten up a space, and a bathroom is no different. They smell great, they can match any existing colour scheme or style, and they’re (relatively) cheap.

“Flowers make a new focal point,” Zetser says, “and it adds colour.”

4 – Light it up
There’s nothing worse than a great bathroom mirror with poor lighting. Check that the lights around the vanity are in good condition and that the light fixtures are not outdated.

“[Agents] should really look at the functionality and the condition of the bathroom,” Zetser says. “Check if the light fixture over the vanity is in good condition – does it have the right bulbs, does it look nice. Sometimes by changing the light fixture it makes the bathroom look like a whole different bathroom.”
5 – Art and Mirrors
Art isn’t just for living rooms and sleeping quarters. Bathrooms, too, can benefit from a painting or picture. And, as Zetser explains, strategically placed art can make the bathroom look larger.

“We also like to put art in the bathroom so it reflects in the mirror,” she says. “So when you walk in, the mirror has the sink right below it and the light above it. Then you have the art behind it, and you see the art in the mirror and it makes the bathroom look bigger.”

6 – The curtain versus door debate
You might not believe it, but Zetser suggests replacing sliding shower doors with – gasp! – a white shower curtain.

“A sliding door makes the bathroom look old, so I recommend getting a shower curtain,” she says. “They make the bathroom look tight. They close off the tub.”

7 – To bath mat or not to bath mat
Bath mats were once staples of the bathroom, but Zetser says they’re an option in the modern bath, depending heavily on the floor beneath it.

“If the floor is not updated, you might want to cover with a bath mat,” she says. “But if it’s a beautiful floor you do not want to cover it up.”

8 – Colour
Like the rest of the bathroom, the colour of the walls should mimic a hotel bathroom, exuding a feeling of calm.

“Most of the time, a good colour is light blue or beige or light grey,” Zetser says. “But sometimes painting it a dark colour makes it moody and more expensive-looking. But you should paint it to match the rest of the bathroom.”

DLC Weekly Rate Minder courtesy of Dominion Lending Centres