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2019 First Home Buyers – How to Receive $750

First-time home buyers in 2019 maybe eligible for a $750 rebate on their 2019 income taxes by claiming the First-Time Home Buyers’ Tax Credit (HBTC)

The First-Time Home Buyers’ Tax Credit (HBTC) allows eligible first-time home buyers who purchased a home in 2019 to claim $5,000 on their federal income taxes for the purchase of the home. This credit works out to be a rebate of $750!

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Steady demand and low supply benefits home sellers

February saw steady home buyer demand and reduced home seller supply across Metro Vancouver.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,150 in February 2020, a 44.9 per cent increase from the 1,484 sales recorded in February 2019, and a 36.9 per cent increase from the 1,571 homes sold in January 2020.

Last month’s sales were 15.6 per cent below the 10-year February sales average.

“Home buyer demand again saw strong year-over-year increases in February while the total inventory of homes for sale struggled to keep pace,” Ashley Smith, REBGV president said. “This was most pronounced in the condominium market.”

There were 4,002 detached, attached and apartment homes newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in February 2020. This represents a 2.8 per cent increase compared to the 3,892 homes listed in February 2019 and a 3.4 per cent increase compared to January 2020 when 3,872 homes were listed.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 9,195, a 20.7 per cent decrease compared to February 2019 (11,590) and a 6.7 per cent increase compared to January 2020 (8,617).

“Our Realtors are reporting increased traffic at open houses and multiple offer scenarios in certain pockets of the market. If you’re considering listing your home for sale, now is a good time to act with increased demand, reduced competition from other sellers, and some upward pressure on prices,” says Smith.

For all property types, the sales-to-active listings ratio for February 2020 is 23.4 per cent. By property type, the ratio is 17.3 per cent for detached homes, 26.9 per cent for townhomes, and 28.4 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,020,600. This represents a 0.3 per cent increase over February 2019 and a 2.7 per cent increase over the past six months.

Sales of detached homes in February 2020 reached 685, a 52.9 per cent increase from the 448 detached sales recorded in February 2019. The benchmark price for a detached home is $1,433,900. This represents a 0.7 per cent decrease from February 2019 and a 1.9 per cent increase over the past six months.

Sales of apartment homes reached 1,061 in February 2020, a 39.8 per cent increase compared to the 759 sales in February 2019. The benchmark price of an apartment property is $677,200. This represents a 0.9 per cent increase from February 2019 and a 3.6 per cent increase over the past six months.

Attached home sales in February 2020 totalled 404, a 45.8 per cent increase compared to the 277 sales in February 2019. The benchmark price of an attached home is $785,000. This represents a 0.6 per cent increase from February 2019 and a 1.7 per cent increase over the past six months.

CMHC says housing vulnerability moderate in Metro Vancouver

The latest CMHC’s Housing Market Assessment

TIFFANY CRAWFORDMore from Tiffany Crawford

Published:February 20, 2020 

Updated:February 20, 2020 2:18 PM PST 

Property tax hikes: 5 things to know | Vancouver Sun1:40

The latest CMHC’s Housing Market Assessment, released Thursday, says house prices are falling as consumers face reduced buying power because of a drop in disposable income and higher interest rates.

Metro Vancouver’s housing has maintained a moderate degree of vulnerability as analysts remain cautious of imbalances in the market, according to a Canada Mortgage and Housing Corporation report.

Vancouver’s housing market stability went from a rating of highly vulnerable to moderate last summer for the first time in three years.

The latest CMHC’s Housing Market Assessment, released Thursday, says house prices are falling as consumers face reduced buying power because of a drop in disposable income and higher interest rates.

The corporation maintained a rating of moderate, however, for overvaluation since the threshold was breached at least twice in the year before the third quarter of 2019. Overvaluation is detected when house prices remain significantly above the levels warranted by drivers of housing markets such as income, population, and actual and expected financing costs.

Vacancy rates continue to remain low so there is little evidence of overbuilding, which is flagged when the rental apartment vacancy rate and inventory of newly built and unsold housing units are significantly above normal levels.

Inventories have started to trend upward in the region, the report says, but remain well below the overbuilding threshold.

The report also found a low level of overheating, when sales outpace new listings in the market for existing homes.

“Vancouver’s housing market is assessed as being moderately vulnerable. Overvaluation was detected in recent quarters and we remain cautious of imbalances in the market,” said CMHC senior analyst Braden Batch.

“The most recently assessed data shows that fundamental house prices declined on weaker consumer purchasing power, and indeed inflation adjusted house prices reflected the fundamental changes in the market, indicating that imbalances have diminished.”

The shift to moderate vulnerability happened as the CMHC dropped its red flag on real estate price acceleration, taking it from a moderate rating last May to its current low rating. Price acceleration happens when there is speculative activity.

Elsewhere, several Canadian cities were downgraded to low vulnerability from moderate in Thursday’s report, including Edmonton, Calgary, Saskatoon and Winnipeg.

Victoria is the lone market maintaining a high degree of vulnerability, as price acceleration and overvaluation imbalances are still evident, says the CMHC.

Ottawa, Montréal, Québec City, Moncton, Halifax and St. John’s maintained low vulnerability ratings.

— With files from Joanne Lee-Young

ticrawford@postmedia.com

What you need to know about strata insurance rate increases

Strata owners in BC are facing insurance rate increases of between 50 and 300 per cent this year, according to the Condominium Home Owners Association of BC.

Deductibles to cover claims are also rising. In some cases, we’ve heard of deductibles increasing as much as $500,000.

Remember that insurance doesn’t cover claims under the deductible amount. So, for example, if a plumbing incident were to cause $75,000 in water damage to a strata owner’s unit, and the strata’s deductible was $100,000, then insurance wouldn’t cover the claim. In such a scenario, the owner could have to pay for the damages out of pocket, depending on the strata’s bylaws.

Why are insurance rates increasing?

Strata building insurance premiums are increasing for a variety of reasons, according to the insurance industry. These include an increase in the number of claims, in the cost of repairs and rebuilding, and in the growing number of strata developments. Many strata buildings date back to the 1970s and ’80s and strata owners may be reluctant to undertake major system upgrades until problems occur.

What you can do about strata insurance

Given these rising rates, strata owners should ask their strata corporation or manager for a copy of the corporation’s certificate of insurance. This document details current deductible amounts.

Strata owners should show the certificate of insurance to their insurance provider and understand what their liability would be in the strata, if the insurance doesn’t cover the deductible.

Strata property owners should also:

  • have a unit owner’s insurance policy;
  • have a policy that covers the higher deductible (insurance deductible insurance) to cover a loss in their unit; and
  • understand the risk of not having enough coverage.

The Strata Property Act Part 9 requires strata buildings to be insured for full replacement value of all common property, common assets, and fixtures.

Government intervention in Alberta

In Alberta, January 2020 changes to the Condominium Property Regulations (Section 62.4) limit condominium corporations seeking to recover the deductible portion of the corporation’s insurance claim to $50,000 from a condo owner for any damage originating in a suite or private area.

REALTORS®’ response

Realtors across the country are working with their professional associations to explore ways to mitigate problems related to this issue.

For example, Realtors in BC are advocating for a requirement for stratas to provide their insurance documents to prospective home buyers. This would ensure that you know about deductible and policy costs up front.

We also know that the Insurance Bureau of Canada and the federal government are discussing regulations for condominium insurance. 

Learn more