Archive for August, 2010

Kick start your move into Real Estate with the RRSP Home Buyers Plan

By Alim Dhanji, Assante Financial Managment

The RRSP home buyers’ plan allows you to withdraw up to $25,000 from your RRSP to buy or build a qualifying home for yourself (as a first time home buyer) or for a related disabled person.  This withdrawal is made tax free!  You may still be considered a first time home buyer even if you own a rental property or if you have not recently owned a home.

The RRSP home buyers’ plan works as a temporary loan to from your RRSP and has to be paid back within 15 years.  You must pay back at least 1/15th of the amount withdrawn starting 2 years after the withdrawal is made.  If the annual scheduled re-payment is not made then it is included as taxable income that year.

For more information on the pros and cons and details on how the RRSP home buyers plan works including CRA forms please contact Alim Dhanji.

Alim Dhanji is a Certified Financial Planner and has been helping people achieve their life goals including buying homes through written financial planning for over 10 years. Alim has been featured on CKNW, The Province, The National Post, Money Sense, The Metro, Investment Executive, Morningstar, and The Insurance Journal. For a free initial consult provided by Soho Properties, please call (604) 688-1919 ex 17.

What is the MLS®?

REALTORS® compete with each other for your business, but at the same time cooperate to help you buy or sell property. That unique concept of cooperating while competing led to the creation of the Multiple Listing Service® (MLS®) in 1950 by the Real Estate Board of Greater Vancouver.

What is the MLS®? Can only REALTORS® use it?

The MLS® is fundamentally a cooperative marketing system that helps the public buy and sell real estate. It’s a system for sharing information between REALTORS® on homes for sale.

Through the MLS® system, the REALTOR® who represents a seller is inviting all other REALTORS® to offer that home for sale to their buyers. Sellers therefore have all the REALTORS® in their community seeking buyers for their homes.

“For buyers, it’s a one-stop shopping experience,” says Jake Moldowan, president of the Real Estate Board of Greater Vancouver.

“By having REALTORS® agree to share their inventory with one another, a more efficient marketplace is created, one that benefits both buyers and sellers,” said Moldowan.

It’s also a system that ensures reliable information about properties for sale and professional accountability.

What’s the difference between MLS® and

The MLS® system is not a public website. It’s owned and operated by local real estate boards, for use by REALTORS®.  Consumers have direct access to information about MLS® listings through the public website (formerly known as This website is an advertising vehicle provided by REALTORS® across Canada to help market properties. is not the MLS® system.

MLS® data is widely recognized by government, the financial community and private sector analysts as the most comprehensive and accurate real estate information in the country. This is because REALTORS® who submit the listing information, and MLS® staff at real estate boards who conduct quality control, are trained and educated in the complexities of real estate.

REALTORS® know how to describe a property accurately and what information must be disclosed in an MLS® listing. For instance, if there is a restriction on the use of a property, something called an easement, this information must appear in the MLS® listing.

How am I protected by using a REALTOR®?

REALTORS® are regulated under provincial laws and governed by a code of ethics and rules of the MLS® system.

They are professionally accountable for the listings they place on the MLS® and the public has recourse if there is a problem.

Why choose to work with a REALTOR®?

Real estate is an extremely competitive profession. Buyers and sellers choosing to work with a professional can select from a wide choice of REALTORS®, service options and pricing models.

Using the MLS® gives excellent exposure to properties for sale, thus attracting offers. Many alternate systems and services exist to buy and sell homes and they all compete for customers. For instance, a person can choose to sell a home themselves or with the assistance of a marketing company.

Consumers can choose from numerous Internet websites like eBay and craigslist, as well as other ways to advertise or buy a home.

“Sellers and buyers often decide to work with a REALTOR® because they want expert guidance through a complex process. For this important transaction, people want to select someone they are comfortable working with and who offers the services they are looking for at a price they can agree on. The MLS® system allows consumers to do just that,” Moldowan says.

“REALTORS® are there to represent you in the transaction. Its not just about selling a house,” he says.

What if MLS® didn’t exist?

If the MLS® system did not exist, sellers would have to choose an individual real estate brokerage to list their home and only that brokerage would have the information about it and the ability to show and sell it. If the MLS® system did not exist, buyers would have to go from REALTOR® to REALTOR® to view the listings of each individual brokerage.

The Multiple Listing Service® gives consumers a choice of which REALTOR® to work with, at the service and price range appropriate for them. And that REALTOR® is obligated by law to look after the best interests of his or her client.

Why am I asked for ID?

On June 23, 2008 new federal money laundering and anti-terrorist financing regulations came into effect that require REALTORS® to collect personal identification information from buyers and sellers.

It’s the law

The Federal Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) requires financial institutions and REALTORS®, among other professionals and services covered by the legislation, to identify customers who conduct financial transactions.

These include buying and selling real estate or depositing funds. The Act also requires REALTORS® to keep these identification records for five years.

What your REALTOR® needs to comply with the law

They must obtain, record, and retain the personal information of their clients including date of birth and occupation. To do this, they must ask for a government-issued identification document such as a driver’s licence, passport, or residency card. You should NOT provide your Social Insurance card as identification.

Here are the situations where they will have to ask for your personal information:

  • when you are buying or selling real estate
  • if you are buying or selling privately, the law requires the REALTOR® representing the other party to obtain your personal information and keep that information on file.
  • if you are acting on behalf of a third party (someone other than you).

Your information will be kept confidential

The only reason your REALTOR® keeps your personal information on file is to comply with the new federal laws. Your information WILL NOT be:

  • used in any commercial way
  • provided to anyone else except in response to a request from the federal agency responsible for compliance – the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)

Who must report to FINTRAC

In addition to REALTORS®, other professionals and organizations are also required to ask for your personal information, inlcuding:

  • financial entities including banks, credit unions, trust and loan companies and agents of the Crown that accept deposit liabilities
  • life insurance companies, brokers or agents
  • securities dealers, portfolio managers and investment counsellors who are provincially authorised
  • persons engaged in the business of foreign exchange dealing
  • dealers in precious metals and stones
  • money services businesses
  • accountants and accounting firms when carrying out certain activities on behalf of their clients
  • casinos
  • individuals and any entity importing or exporting currencey or monetary instruments (such as a money order) of $10,000 or more
  • lawyers and notaries public
  • real estate developers and builders

For additional information about this federal initiative, please visit FINTRAC’s website or call toll-free 1-866-346-8722.

Close to home. What do property taxes pay for?

Vancouver has once again been rated the most livable city in the world, topping 140 cities, according to a survey from the Economist Intelligence Unit.

The annual survey scores cities worldwide from 0 – 100 based on 30 factors grouped in broad areas such as infrastructure, the environment, culture and education.

How do we rate number one, year after year? Property taxes and what they pay for have a lot to do with it.

Think about our great infrastructure, our award-winning libraries and recreation facilities, playing fields and cycling paths, our abundant parks and green spaces, our well maintained road surfaces, and our new police officers and firefighters. Taken together, these add up to a high quality of life in Metro Vancouver.

To help preserve our quality of life, we have to pay property taxes, which go toward funding:
• animal control police
• local road maintenance
• archives and museums
• parks/green spaces
• community centers
• sewers
• police protection
• emergency plans
• safe building regulation
• fire service
• safe drinking water
• heritage planning
• sewage treatment
• innovative land use planning
• swimming pools/ice rinks

Why have property taxes increased overall?

This is a question REALTORS® are asked by home owners and home buyers. Generally there are two reasons:

1 – Property taxes are set by local government councils to meet their funding needs. Local governments cannot run a deficit so they must raise taxes and/or fees to meet the cost of providing increased services (or they must cut services). Costs increase for a variety of reasons including inflation, higher energy and materials costs, rising salaries and new programs.

2 – New residential construction was down about 23 percent compared to the previous year, which means the tax base wasn’t growing as much. A growing tax base helps spread the tax load over more taxpayers and minimizes the need for property tax increases.

Home Buyers in the Driver’s Seat

Vancouver, BC – August 12, 2010. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province declined 42 per cent to 5,784 units in July compared to the same month last year. On a seasonally adjusted basis, MLS® residential unit sales in the province declined 19 per cent in July from June 2010. The average MLS® residential price climbed 6 per cent to $491,832 in July compared to the same month last year.

“A relatively large number of homes for sale have created the most favourable supply conditions for home buyers in more than a year,” said Cameron Muir, BCREA Chief Economist. MLS® active residential listings were 21 per cent higher in July than at the start of the year on a seasonally adjusted basis. However, with newly listed MLS® residential units now declining, tighter market conditions may emerge this fall.

Year-to-date, BC residential sales dollar volume increased 16 per cent to $24.2 billion, compared to the same period last year. Residential unit sales rose 4 per cent to 48,127 year-to-date, while the average MLS® residential price climbed 13 per cent to $504,281 over the same period.

A Day in the Life of a Realtor

Homebuyers and Sellers less active in July

VANCOUVER, B.C. – August 4, 2010. Home sales activity in Greater Vancouver was quieter last month than most Julys over the past decade, with residential sales, prices, and the number of homes listed for sale trending downward in recent months.

The Real Estate Board of Greater Vancouver (REBGV) reports that the number of residential property sales in Greater Vancouver totalled 2,255 in July 2010. This represents a 45.2 per cent decline from the 4,114 sales in July 2009, the highest selling July ever recorded, and a 24.1 per cent decline compared to June 2010.

Looking back further, last month’s residential sales represent a 3.7 per cent increase over the 2,174 residential sales in July 2008, a 41.8 per cent decline compared to July 2007’s 3,873 sales, and a 17.5 per cent decline compared to July 2006’s 2,732 sales.

“With the pace of home sales and listings easing off in our market, we’ve begun to see a levelling of home prices from the record highs seen in the spring, creating greater affordability,” Jake Moldowan, REBGV president said. “Activity in today’s marketplace is clearly trending in favour of buyers.”

The number of properties listed for sale on the market has been trending downward since spring, with 4,138 new listings in July compared to April’s peak of 7,648. New listings for detached, attached and apartment properties in Greater Vancouver on the Multiple Listing Service® (MLS®) declined 17.9 per cent in July 2010 compared to July 2009, when 5,041 properties were listed for sale.

At 16,431, the total number of property listings on the MLS® in July declined 6.5 per cent compared to last month and increased 33 per cent compared to July 2009.

“It’s currently taking home sellers who work with a REALTOR®, on average, 45 days to sell their property, which is a historically healthy timeframe for people on both sides of a transaction,” Moldowan said.

Since spring, housing prices have decreased 2.8 per cent compared to the all-time high reached in April when the residential benchmark price was $593,419. Over the last 12 months, the MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver increased 9.1 per cent to $577,074 in July 2010 from $528,821 in July 2009.

Sales of detached properties in July 2010 reached 908, a decrease of 43.7 per cent from the 1,614 detached sales recorded in July 2009 and a 9.8 per cent increase from the 827 units sold in July 2008. The benchmark price for detached properties increased 11.5 per cent from July 2009 to $793,193.

Sales of apartment properties reached 979 in July 2010, a decline of 42.7 per cent compared to the 1,708 sales in July 2009 and an increase of 1.3 per cent compared to the 966 sales in July 2008.The benchmark price of an apartment property increased 6.2 per cent from July 2009 to $387,879.

Attached property sales in July 2010 totalled 368, a decline of 53.5 per cent compared to the 792 sales in July 2009 and a 3.4 per cent decline from the 381 attached properties sold in July 2008. The benchmark price of an attached unit increased 8.6 per cent between July 2009 and 2010 to $490,995.

Mortgage Payment Table

Save this file to your phone or desktop and reference to estimate monthly mortgage payment for every $100,000.

BC Home Sales to Rise in 2011

BCREA Housing Forecast Update – Third Quarter 2010

VANCOUVER, B.C. – July 30, 2010. The British Columbia Real Estate Association (BCREA) released its Housing Forecast Update for the third quarter of 2010 today.

BC Multiple Listing Service® (MLS®) residential sales are forecast to decline 7 per cent from 85,028 units in 2009 to 79,500 units this year, before increasing 5 per cent to 83,400 units in 2011.

“The volatility in consumer demand characteristic of the past 24 months is expected to give way to more gradual improvement through 2011,” said Cameron Muir, BCREA Chief Economist. “Housing demand has fallen back to earth from its break-neck pace at the end of 2009 and is expected to more closely match overall economic performance over the next 18 months.”

“A larger inventory of homes for sale has created the most favourable conditions for home buyers in more than a year,” added Muir. “However, the buyers’ market is expected to be short-lived as total active listings peaked in May and are beginning to wane, with more balanced conditions set to emerge in the fall.”

The average MLS® residential price is forecast to climb 6 per cent to $492,800 this year and remain relatively unchanged in 2011, albeit declining by 1 per cent to $489,500.