February Home Sales Edge Lower, BCREA. Vancouver, BC – March 14, 2014. The British Columbia Real Estate Association (BCREA) reports that a total of 5,578 residential sales were recorded by the Multiple Listing Service® (MLS®) in February, up 24.9 per cent from February 2013. Total sales dollar volume was $3.4 billion, an increase of 43.1 per cent compared to a year ago. The average MLS® residential price in the province rose to $611,688, up 15.4 per cent from the same period last year.
“Consumer demand was much stronger in February compared to a year ago, but edged lower compared to January,” said Cameron Muir, BCREA Chief Economist. “Weak employment growth in 2013 has limited home sales so far this year to long-term average levels.”
“Record low mortgage interest rates and population growth continue to underpin the housing market and most regions of the province are at or near balanced market conditions,” added Muir.
Year-to-date, BC residential sales dollar volume was up 10.1 per cent to $36.7 billion, compared to the same period last year. Residential unit sales were up 6 per cent to 68,510 units, while the average MLS® residential price was up 3.8 per cent at $535,411.
The BC Government recently released it’s 2014/2015 Budget and in that Budget changes were made to the First Time Home Buyers’ Program. The main change was to Property Transfer Tax and the exemption threshold which was increased to $475,000 from $425,000. This change applies to all registrations on or after February 19th, 2014. I have included information below regarding the First Time Home Buyers’ Program and how it works. It is always important to talk to your mortgage broker about this program to ensure that you do qualify for the exemption if you are a first time home buyer.
Information about Property Transfer Tax and the First Time Home Buyers’ Program (from BC Government Website)
The First Time Home Buyers’ Program reduces or eliminates the amount of property transfer tax you pay when you purchase your first home. If you qualify for the program, you may be eligible for either a full or partial exemption from the tax.
If one or more of the purchasers don’t qualify, only the percentage of interest that the first time home buyer(s) have in the property is eligible.
For example, if you qualify and purchase a property with a fair market value (see below) of $400,000 with a person that doesn’t qualify you would still qualify. If you owned a 60% interest in the property, 60% of the tax amount would be eligible for the exemption.
have lived in B.C. for 12 consecutive months immediately before the date you register the property or filed at least 2 income tax returns as a B.C. resident in the last 6 years
have never owned an interest in a principal residence anywhere in the world at any time
you have never received a first time home buyers’ exemption or refund
If you don’t qualify because you are not a Canadian citizen or permanent resident, but you become one within 12 months of when the property is registered, you may apply for a refund of the tax. To apply for a refund call (250) 387-0604.
Fair Market Value
Fair market value is the price that would be paid by a willing purchaser to a willing seller for a property (land and improvements) in the open market on the date of registration.
Open Market Transfers
A property transfer is considered to be in the open market when anyone likely to be interested in purchasing the property can make an offer. For example, the seller lists the property with a realtor or advertises it for sale.
The purchase price is considered the fair market value in most cases as long as you register the property within a few months of signing the sales contract. Otherwise, you will need to verify that the purchase price is fair market value if:
there was a significant change in value
the condition of the property changed
you didn’t purchase the property in the open market
Non-Open Market Transfers
When a property transfer doesn’t take place in the open market, fair market value may be determined using other means such as:
a recent independent appraisal, or
the property valuation provided by BC Assessment
Generally, the property valuation provided by BC Assessment reflects your property’s fair market value as of July 1 of the previous year. For example, the 2013 roll value reflects market conditions at July 1, 2012. This means that the assessed value may not reflect the current fair market value of your property.
The current property valuation provided by BC Assessment can’t be used in certain cases, such as when:
changes have been made to the property (e.g. rezoning) since the assessment
market conditions in the area of the property have changed since the assessment
BCREA: BC Real Estate Statistics and Housing Market Update for February 2014. I have included the BC Real Estate Association’s report for this month. BCREA Chief Economist Cameron Muir discuss the January 2014 statistics and how the cancellation of the Federal Immigrant Investor Program will impact the housing market. See video below and full article from BCREA is included below the video.
Strongest January Residential Sales Since 2010
Muted Impact Expected From Cancelled Investor Immigrant Program
Vancouver, BC – February 14, 2014. The British Columbia Real Estate Association (BCREA) reports that a total of 4,244 residential sales were recorded by the Multiple Listing Service® (MLS®) in January, up 24.5 per cent from January 2013. Total sales dollar volume was $2.4 billion, an increase of 36.8 per cent compared to a year ago. The average MLS® residential price in the province rose to $565,036, up 9.9 per cent from the same period last year.
“Residential sales activity in the province posted the strongest January since 2010,” said Cameron Muir, BCREA Chief Economist. “Consumer demand has recovered from last year’s lower levels and is now trending at the long-term average.” The ten-year average for January is 4,276 unit sales.
“Stronger economic conditions are expected to underpin a modest uptick in home sales later this year,” added Muir.
The demise of the federal Immigrant Investor Program is expected to have little impact on the Metro Vancouver housing market. “The only impact we foresee is less pressure on the inventory of detached homes in Vancouver’s West Side, Richmond and West Vancouver,” said Muir.
The number of investor immigrant landings peaked at 5,876 in 2008 before declining to just 2,644 in 2012, with a similar number expected for 2013. These numbers include spouses and dependents. The total number of added households is estimated to be between 900 and 1,000 per year since 2011.
VICTORIA, BRITISH COLUMBIA–(Marketwired – Feb. 6, 2014) – According to Canada Mortgage and Housing Corporation’s (CMHC) First Quarter Housing Market Outlook British Columbia Highlights report, housing starts in British Columbia are forecast to total 27,800 homes in 2014 and remain at that level in 2015.
“While the level of housing starts is projected to remain the same on an annual basis this year and next, expect a slight shift toward single-detached housing starts as the economy and labour market gain traction,” noted Carol Frketich, CMHC’s BC Regional Economist. “Single-detached housing starts are forecast to increase this year and next while multiple housing starts are expected to remain relatively unchanged.”
Existing home sales through the Multiple Listings Service (MLS) are forecast to total 76,000 units in 2014 and 77,300 units in 2015. The average home price is forecast at $542,500 in 2014 and $547,100 in 2015. Last year’s upward trend in the average home price is expected to lead to increased new listings in 2014. With the increased supply of existing homes for sale providing more choice to homebuyers, the average home price is forecast to grow at a pace slower than the general rate of inflation.
Click here to review the CMHC Housing Market Reports
For more information, visit CMHC.ca or call 1-800-668-2642.
The BC Government recently released it’s 2014/2015 Budget and in that Budget changes were made to the First Time Home Buyers’ Program. The main change was to Property Transfer Tax and the exemption threshold which was increased to $475,000 from $425,000. This change applies to all registrations on or after February 19th, 2014. I have included information below regarding the First Time Home Buyers’ Program and how it works. It is always important to talk to your mortgage broker about this program to ensure that you do qualify for the exemption if you are a first time home buyer.
VICTORIA, BRITISH COLUMBIA–(Marketwired – Feb. 6, 2014) – According to Canada Mortgage and Housing Corporation’s (CMHC) First Quarter Housing Market Outlook British Columbia Highlights report, housing starts in British Columbia are forecast to total 27,800 homes in 2014 and remain at that level in 2015.