As a Canadian citizen we are only allowed to own 1 principal residence and receive the principal residence tax exemption (Capital Gains tax free) when selling. In this blog I’m going to give you an example of where I’m seeing wealthy oversees buyers purchasing multiple properties and designating them as principal residences in family members names to avoid the capital gains tax when they sell. In my opinion, a principal residence purchase should be tied into Revenue Canada and that each purchaser should be required to file a Canadian tax return to prove that the funds were earned by the person on title. This simple solution would at least level the playing field for all buyers and generate billions of dollars into the general tax cof ...

It's now been 6 weeks since the new foreign buyers tax was introduced and so far there has been very little impact to the market as far as prices go. Sales volume has dropped, however I wouldn’t read much right now into the 26% decline in sales when comparing Aug 2016 to Aug 2015 that was reported last week. August 2015 was a record breaking month and we had much more inventory to sell. We continue to have record low inventory levels. For prices to start coming down, inventory levels (homes for sale on MLS) are going to have to increase dramatically going forward. The next 2 to 3 months will tell the story as we head into our busy Fall season, where we normally start to see an increase in the number of listings. If sales don’t keep p ...

In the Vancouver condo market right now (Labour Day 2016) there are 3 buyers for every seller. Inventory (Units for sale) is at an all time historic low. Part of the problem is that developers are forced to build like it’s 1985 and not 2016. We continue to build mostly low to mid-rise condo buildings when we should be building much higher and increasing density. There are also massive areas of prime real estate in the city centre that are zoned for commercial/ light industrial only. The current price situation is caused by 2 main factors. Ultra low interest rates are the main driver (watch my video blog from last week Aug 28) and lack of supply. There are only 2 ways for home prices in Vancouver to start to moderate or decrease in an ...

People under estimate the impact that record low interest rates have on Vancouver home prices. It is by far the biggest driver on prices and the main reason our Vancouver market remains at record setting prices. I suggest you go to a website called www.calculator.net and see for yourself. The nice thing about this mortgage calculator is that it breaks down the Interest vs Principal payment every year for the full 25 years of the mortgage. With todays 2.3% for 4 yr term you are paying down more principal than interest right from year 1. Whereas 7 yrs ago in 2009 that rate was 6.5% which took you 15 years before you hit that crossover point. Run of the mill market corrections of 5 to 15% are very common in the Vancouver market and we t ...

There was a story in the media a few weeks ago that profiled a typical Vancouver home owner on the East side. The gist of the story was how this homeowner had essentially made over $250,000 in the past year by doing nothing. While hard working 9 to 5ers toiled away making $50K. I first wondered if the story had been reprinted from the Onion, a satirical newspaper. Or if it had been written by a comedian. Neither turned out to be the case. The article wasn’t trying to be funny. The reported really was disdainful of the homeowners returns. I suggest people look at articles like this differently. Avoid getting swept up in the feelings of injustice or outrage that an article like this seeks to create. Think to yourself “What can i learn ...

The ripple effect from the new 15% foreign buyers tax could be felt for 12 to 18 months or more. What effect it’s going to have on the market as far as prices go is still too early to predict. What we do know is that there are 1000’s of deals in the system that could be in jeopardy of not closing because the foreign buyer has decided not to close to avoid paying the new tax. This can have a domino effect on other sales that are tied to that first sale. This new tax may also have an impact on luxury condos that were sold over the past 3 to 6 months but do not complete until 2017. Depending on what the market does between now and say 18 months out, will determine if those deals may be in jeopardy as well.

As expected, because this new tax was not grandfathered, there was a run on lawyers and notaries to try and push completion dates forward last week to avoid the new 15% PTT on all foreign buyers. Will this be allowed under the anti-avoidance clause that’s in the new tax ? The tax is not only affecting wealthy Chinese buyers but young first time buyers from the U.S. as well. The Provincial Government is pumping the brakes and trying to cool this market. What effect it will have is too early to tell. It’s the fear of the unknown, and if there are other measures coming, that might have the biggest impact of the market down the road.

The BC Government dropped a bomb on us yesterday by announcing a whopping 15% PTT tax on all foreign buyers of homes in the Lower Mainland effective Aug 2. In this blog I will address this new tax and the ramifications going forward on the Vancouver housing market.

Time for an update on the most asked question I receive at my open houses every weekend. Should I be a buyer in this ultra hot Vancouver sellers market and pay record setting prices? My answer has always been yes, provided you have a minimum holding period of 8 to 10 years to weather any short term corrections. Since the last blog I did on this question 18 months ago prices are up another 25% across the board. Therefore, I’m going to increase my minimum holding period to 10 Years. Watch my blog to learn my reasoning.

Here’s the blog that many of my viewers have been asking me about. What's the solution to curbing or at least slowing this ultra hot Vancouver Real Estate market and making homes more affordable? In this blog I will address foreign buyers and what exactly is a foreign buyer. I will also address new taxes that have been proposed and what their effects would be as well as the lack of supply in Vancouver, and why Vancouver City hall and the Province need to be approving more re-zoning and density.