West End residents take Vision Vancouver to court over market housing policy

RENTING A CONDO may be cheaper than owning one, but it doesn’t mean that the rental unit is affordable.

This is a central argument in a new legal challenge against the City of Vancouver program that provides incentives to developers of market rentals.

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Reblogged from The Georgia Straight

On February 3 this year, the West End Neighbours Residents Society filed an amended petition seeking a court declaration that Rental 100: Secured Market Housing Policy—and its now-expired predecessor, Short Term Incentives for Rental Housing, or STIR—violates the Vancouver Charter.

The two policies were introduced by the ruling Vision Vancouver party.

“They’re giving away too much to developers in return for not enough back to the public,” WEN director Randy Helten told the Georgia Straight by phone on February 18.

According to Helten, the case will be heard by the B.C. Supreme Court on April 9 and April 10 this year.

In effect since 2009, STIR and the subsequent Rental 100 allowed council to waive development-cost levies (DCLs), reduce parking requirements, approve smaller apartment sizes, and allow developers to build more units than they would otherwise have been permitted, all in return for producing affordable market rental housing.

According to the WEN petition, the city waived about $10 million in DCLs between 2010 and 2013.

The Vancouver Charter allows council to forgo development levies only on three types of projects, one being “for-profit affordable rental housing”.

Moreover, the charter mandates that council defines through a bylaw what constitutes an eligible development.

In September last year, WEN launched a court challenge against STIR and Rental 100. It claimed, in part, that the city didn’t define what constitutes affordable rental housing to justify the non-collection of development levies.

Because of the suit, the city agreed to amend its rules. On December 3 last year, the Vision Vancouver–dominated council defined for-profit affordable rental housing as those whose initial rents do not exceed the following: $1,433 a month for a studio unit; $1,517 for a one-bedroom; and $2,061 for a two-bedroom.

In its amended petition, WEN argued that what the amendments do is simply allow the waiver of development-cost levies for “market rate rental housing” but not necessarily affordable rental housing.

It noted that the average monthly rental rate for a bachelor unit in the West End is $902, and $714 in Marpole. This means that the city “deems developments, with potential rental rates almost twice the City average, to be ‘affordable’ rental housing simply because they are rental as opposed to freehold”.

The amended petition also stated that staff were given “unfettered discretion to waive DCL’s for projects that are not ‘affordable’ at all, but simply market rental”.

Read the original article and follow author Carlito Pablo here.

Bang for your $599,000 buck

There’s a house for sale in Vancouver for under $600,000

Reblogged from The Province

In a city where affordable housing is an oxymoron, a two-storey East Vancouver character home is bound to catch some attention with its price tag.

The 1,951-square-foot home at 2622 Clark Dr. is set to go on the market Monday with a listed price of $599,000 — expected to be the lowest-priced, detached, freehold house in Vancouver.

“I expect it to be noticed,” said listing agent Mary Cleaver. “It’s a beautiful renovated Craftsman-style house in a lovely neighbourhood at a great price.”

The low price is because the three-bedroom, two-bath Grandview-Woodland property faces busy Clark Drive and is on a small 30.5-X-58-foot lot, about half the depth of typical lots in the neighbourhood.

Contrary to what some people might expect from the — relatively — bargain-basement price, the house is well-kept and lovingly maintained.

Built in 1911, its plumbing, electrical and windows were updated before the current owners bought the place in 2005 for $333,000. They have since replaced the roof, refinished the floors, installed a new kitchen and repainted the exterior, said Cleaver.

Homeowner Simon Yu, who owns a deck-renovation company, also added a wraparound deck to the home, adding an extra 600 sq. ft to the property.

The low price is rare in the city, said Cleaver, although it isn’t the only one. In January, a house in the Fraserview-Killarney neighbourhood sold for $592,000. A house off of Commercial Drive sold for $471,000 in April 2012.

Currently, the cheapest freehold, detached house listed in Vancouver is $628,000 in Hastings-Sunrise.

The Clark Drive house may be a deal in comparison with million-dollar fixer-uppers that have become the norm in the city, but statistics show Vancouver’s housing market still remains out of reach for average wage earners. An RBC report last year shows detached homes in Metro Vancouver require more than 80 per cent of median household income. A recent international survey also placed Vancouver second after Hong Kong in having the least-affordable housing.

And there are no signs Vancouver’s sky-high market is heading for a downturn. The region’s housing market is maintaining its steady pace from last year, said the Real Estate Board of Greater Vancouver, with residential sales in February jumping 40 per cent compared with February 2013.

Cleaver said the homeowners, who have two young children, were very happy in the house, but are selling it because they need more space. She’s holding an open house April 5 and 6 from 2 to 4 p.m.

“It’s a very nice, livable house, and (at that price), it is competing with apartments and townhouses,” she said.

What $599,000 will get you:

If you want even more bang for your buck, you have to look farther afield. Here is what $599,000 will get you in:

Langley: 20465-67B Ave.

A 3,248-square-foot, five-bedroom, four-bathroom house in Willoughby with gourmet kitchen and finished basement.

Maple Ridge: 10070-246B St.

Built in 2013, this four-bedroom home on a quiet street has a great room, vaulted ceilings in the master bedroom and a rec room.

Sechelt: 6220 Mika Rd.

There are panoramic sea views, oversized decks and 14-foot ceilings in this five-bedoom West Sechelt home on a 11,412-sq.-ft lot.

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Tax tips for investors: Clearing up real estate confusion

Real estate has been a hot investment area in Canada for quite some time now due to favorable economic conditions, immigration, and historically low interest rates. Canadians who have taken advantage of these conditions are sometimes confused about the measures they can take to reduce their tax burden.

Here are some tax tips addressing several typical areas of confusion:

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Reblogged from Financial Post | Fabiola Campanella

To depreciate or not to depreciate

Depreciation, or for income tax purposes Capital Cost Allowance (CCA) can be an effective way to shelter your real-estate income from current taxes by transferring your obligation to future tax years. CCA works by amortizing a portion of the cost of your rental property against your rental income, generally 4% of your building’s cost on a declining basis year over year.

CCA is an election, meaning that it is the taxpayer’s choice whether or not to use it. The drawback to CCA is that it is recaptured in the year you sell your property, meaning that the historical CCA you’ve taken will be added back on income account to your tax return if you sell the property for anything more than your current un-depreciated capital cost (i.e. the cost of your property less the CCA claimed on prior tax returns.

This recapture can have a negative impact on your taxes in the year of sale so some planning around this election is required. Generally, if you plan on holding the income property for a very long period of time then taking CCA to reduce your rental profits to zero will almost always be advisable.

However, if you plan on selling your property in the near future you should attempt to estimate if your potential recapture will push you into a higher tax bracket, thereby reducing the current effectiveness of the CCA claim. You may also want to consider forfeiting CCA in years where your overall taxable income is low thereby allowing you to claim higher CCA in subsequent years when your marginal tax rate is higher. For more information on CCA see the CRA’s Guide T4036, Rental Income.

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Vancouver home sales jump 30% in January from a year ago, board warns people to ‘price’ home right

The message from realtors in Canada’s most expensive city is clear — price your home right if you want it to sell.

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Reblogged from The Financial Post | Gary Marr

The message from realtors in Canada’s most expensive city is clear — price your home right if you want it to sell.

The Real Estate Board of Greater Vancouver said there were 1,760 sales through the Multiple Listing Service in January, a 30.3% increase from a year ago. But sales were down 9.9% decline from December.

The board’s president had a specific message to homeowners, in a press release.

“If you’re looking to sell your home in a balanced market, it’s critical that your list price is reflective of current market conditions,” said Sandra Ms. Wyatt.

Last month’s sales figures remain 7.2% above the 10-year average for the month of January. Prices have inched up a bit too. The board’s composite benchmark price for all residential properties in Metro Vancouver stood at $606,800 last month, a 3.2% increase from a year ago.

“The Greater Vancouver housing market has been in a balanced market for nearly a year. This has meant steady home sale and listing activity accompanied by stable home prices,” said Ms. Wyant, in the release.

New listings are on the rise, reaching 5,128 in January. That’s a 4.2% increase from a year ago. New listings were also 17.7% above the 10-year average for the month.

The new listings bring the total number of properties for sale across the Greater Vancouver area to 12,602 which is down 4.9% from a year ago but up 9% from December.

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Getting rid of risky property play will improve retirement

Situation: Couple has retirement portfolio with high risk investments that could fizzle
Solution: Get out of speculative investments, then invest for reliable income

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Reblogged from Andrew Allentuck

In Alberta, a couple we’ll call Frank, who is 57, and Ella, who is 51, emigrated to Canada decades ago to find work and build secure lives.

Starting with nothing but their will to work, Frank in a municipal civil service job, Ella in health care, they have built up about $705,000 of net worth, most of it in their $490,000 home. They worry, however, that their income from about $184,000 of financial assets plus two civil service pensions at 65 plus CPP and OAS may not be enough to sustain their retirement. The irony is that their Canadian assets would make them very wealthy in their countries of birth. In Canada, though, they worry that their liabilities could sink their retirement.

It is a legitimate concern, for they have a $70,000 line of credit to pay off at $1,200 a month, about 18% of their $6,500 combined monthly take-home pay. The line of credit was taken out to buy into a speculative land development in which they are co-owners of undivided land rather than sole owners of a defined parcel. It is a risky investment that produces no current income. Moreover, they have $37,500 in a mortgage fund in their RRSPs which yields 10% a year. That yield implies the mortgages carry more risk than banks and credit unions accept.

Family Finance asked Derek Moran, head of Smarter Financial Planning Ltd. in Kelowna, B.C., to work with Frank and Ella, who still have a daughter at home attending university.

“The good thing about the couple’s financial affairs is their dedication to their work and their home,” he says. “The not so good thing,” he notes, “is that they appear to have made investments in land and mutual funds on the basis of trust in advice.”

The interest on the loan to buy the property is not tax deductible, though it can be added to the adjusted cost base of the property, eventually reducing the taxable capital gain. Best bet: sell the land to pay off the line of credit and capture a capital gain which the couple believes to be about $30,000 or $20,000 after costs. We’ll assume they just get their money back, then invest in low fee mutual or exchange traded funds focused on producing dividends.

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Five things to do if you are over-extended on your mortgage

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Reblogged from Financial Post, Andrew Allentuck

Mortgage default may be rare in this country, but nearly 9% of indebted households need 40% or more of their gross income to pay their debt service charges, says the Bank of Canada Financial System Review.

If you can see problems coming, then you can take action to avoid foreclosure, which happens when lenders run out of other alternatives and borrowers can do no more to pay their debts. Here are five options to consider when you are being crushed by mortgage payments:

1. Extend amortization: If the mortgage has been paid down to 10 or 15 years, then extending it to 20 to 25 years or even to 30 years will decrease payments. In a lot of cases this will work, says Elena Jara, director of education for Credit Canada Solutions, a Toronto-based non-profit organization which offers free credit counselling.

2. Seek better terms: You can go for lower interest rates with the same or a different lender but with a potential penalty, says Bill Evans, a mortgage broker with Mortgage Architects in Winnipeg.“If you are having trouble with payments with one lender, another may not want to take you on. But if you can present a case for a new income, you can go to a so-called specialty lender such as Home Trust or Optimum Trust for a fresh look at your problem and potential solutions,” Evans says. “If you just want to alleviate the problem, timing is crucial.”

3. Renew at a floating rate: There is more risk but lower interest cost in floating rate mortgages. If you are on a fixed rate mortgage with relatively high rates and want to go to a lower floating rate, perhaps by taking the mortgage to another lender, then there may be relief when it is time for loan renewal. The present lender may add a penalty, but over time, floating rates and the often attractive rate on a one-year closed loan can offer relief, Mr. Evans says.

4. Sell it and rent: In markets with high home prices as a result of speculative building, absentee owners will often rent at relatively low cost. That makes for good deals for renters.

5. Discuss a consumer proposal
The homeowner can avoid outright bankruptcy and foreclosure of the home by talking to creditors, suggests Bruce Caplan, trustee in bankruptcy for BDO Canada Ltd. in Winnipeg. “The homeowner can make a consumer proposal in which a settlement plan is devised for the creditors. Secured creditors such as the banks or private mortgage lenders can work out new terms such as reduced payments or a payment bridge for a period of time with the homeowner,” he suggests.

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Quick! Read this before you head off on Winter Holidays!

Five practical financial preparations for a long-term vacation.

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Reblogged from Financial Post, Melissa Leong

When that first cold wind or frost hits, I’m always surprised. I have no clue why — I’m Canadian, a Winnipeg native — and I’m well acquainted with this country’s winters.

If the chilling reminder of what’s in store this season has you thinking of going on an extended trip, here are five financial preparations to make before any long-term vacation.

Get travel insurance. Only half of Canadians, according to BMO, buy medical insurance before traveling. You don’t want to get caught with a $20,000 bill to treat a broken leg in the U.S. Check with your employer or your credit card company because you may have some coverage under their plans.

Check your home insurance policy. According to a recent TD Insurance survey, only 12% of Canadian snowbirds say they checked their home insurance policy to ensure their primary residence would be covered while on vacation. Often, insurance policies have specific “away” requirements, which, if not fulfilled, could void coverage if your home is left unoccupied and unattended for an extended period of time, TD Insurance says. Make sure you know what steps to take to keep your policy valid, for example arrange to have someone check your home every seven days to make sure heating is on and shut off the water supply.

While you’re renting a vacation home, if you have home insurance, your contents could be covered anywhere in the world and you may have liability coverage. It’s best to check your policy.

You want your home to have that “lived-in” look while you’re away.Suspend your newspaper subscription. Have someone shovel your snow. Get Canada Post to hold your mail. This service starts at $20 for the first 10 weekdays and is $8.50 for each additional week. So if you’re gone for six weeks, it will cost you $54 for Canada Post to hold your mail. To save money, enlist a friend who will come by and check up on the property and collect your mail.

Don’t forget to set up a budget before you leave. The wise thing to do would be to know how much you have to spend and try to play within your boundaries. The unwise thing to do would be to overuse your credit card and return home to a giant bill that will stress you out after a relaxing vacation.

Make sure that your bills get paid. A lot of bills can be paid online or prepaid with your credit card. Make a list of the bills that need to get paid and try to sort out the payment before you leave in case the sun and the beach makes you forgetful.

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Alternative mortgage lenders get boost from Canada’s resilient housing market

Sean DeCory | National Post

Sean DeCory | National Post

Reblogged from The Financial Post, David Pett

Shares in three of Canada’s biggest alternative mortgage lenders look set to rise over the next year due to the ongoing resiliency of the country’s housing market.

“Alt-A lenders should continue to see enviable growth,” said Shubha Khan, an analyst at National Bank Financial. “We believe that near-term housing market risks have moderated, particularly in view of more dovish comments on interest rate policy from the Bank of Canada.”

Mr. Khan said credit quality also remains sound with mortgage delinquency rates near historical lows. He increased his price targets on Equitable Trust Inc., MCAN Mortgage Corp. and Home Capital Group Inc. and reaffirmed his outperform rating on all three names.

Equitable Trust can be expected to rise 30% over the next 12 months to $64, while MCAN will jump 22% to $16 over the same period, he said.

Home Capital Group, meanwhile, is set to climb as high as $95 – a 17% gain – after reporting solid third-quarter earnings on Wednesday after market close.

Read More … 206 more words

Vancouver Launch Announced for Alture MidCity!

Alture MidCity – Visit the Project Summary page
– View Alture MidCity on Pinterest

Welcome to the Alture MidCity – Official Vancouver Launch event!
Hosted by Alture Properties at the Pan Pacific Hotel on November 23rd, 2013.
Please RSVP at http://www.midcitycalgary.ca or call 604-777-1808 ext.1

Why invest in the ordinary when You are Extraordinary? We invite you to learn more about and profit from Canada’s #1 Investment City. Our project featuring detailed proforma and competitive pricing – every unit in the building is designed to cash flow to an annual rental yield of ~7%. Units from $173,900 and located in the Midnapore area of Calgary, Alberta – walking distance to the LRT and 20 mins to Downtown Calgary. If you’d like to contact me for more information, feel free to use the contact form below to reach me directly by email.

MidCity logo on white

Alture MidCity Final Rendering

To see the full project details and follow development updates as they happen, please visit the project summary page.

Exciting announcement coming soon! Alture MidCity

Alture MidCity – Visit the Project Summary page
– View Alture MidCity on Pinterest

MidCity logo on white

Get ready for the announcement of our Grand Opening and Launch Party! Invitations and registration will be opening within the next week, tentative event date set for November 23rd, We know for sure there will be limited seating so reservations are required. Advance pre-sale registrations have already taken place – so to get your insiders discounts and first pick of available units, keep your eyes on the site here for updates to be posted or send me a quick email below!

Alture MidCity Final Rendering

To see the full project details and follow development updates as they happen, please visit the project summary page.