With interest rates on the rise, it's a great idea for home buyers to visit their bank or mortgage broker and apply for a pre-approval rate. Also, you may need to think about advancing your plans if you already have a locked-in rate that's about to expire.

A Pre Approved Mortgage locks in your interest rate at the lowest rate available on the day of your pre-approval.  This rate lock holds for anywhere from 60 to 120 days while you look for your new home to purchase.  If mortgage interest rates go up in that time period you are protected and will still be offered the original low rate

from the date your mortgage was pre-approved.  If mortgage interest rates go down you will automatically receive the new lower rate.

It is not unheard of for mortgage rates to fluctuate half a percent to a full percentage point throughout a 120 day time period. Very recently, mortgage rates have been rising - in fact they've gone up nearly 3/4%.  If you were calculating what you can afford based on a lower old rate, you may be very disappointed to learn that you can no longer afford that same mortgage amount with the new higher mortgage rates because you didn't take the time to pre-approve your mortgage.

~ When do you need a building permit? ~ Part Two

Last week I started to talk about building permits, and in Part 1 we talked about when a building permit is required.
Today we will talk about what the penalties and liabilities are. In case you have not read last week's article you can read it here.

So, what are the consequences of building/renovating without a permit? Here is the official version...

*Every person who commits an offence contrary to the provisions of this Bylaw is liable on summary conviction to a penalty of not more than $10,000.00 in addition to the costs of the prosecution.

Other possible consequences:
1. There are serious liability consequences if someone gets hurt. If you are building a deck and it collapses and people get hurt. Big trouble.
2. If there is a fire or something that results from it, your homeowners insurance can refuse the claim.
3. You may have to tear down the structure.
4. It may make it extremely difficult to sell your house and to have it inspected in order to do so.

Who is liable ?
*An owner is deemed to have knowledge of and be liable under this Bylaw in respect of any construction on the parcel the owner owns and any change in the use, occupancy or both of a building or structure or part of a building or structure on that parcel.
*If you buy a house that had work done without the permit by previous owner without your knowledge you are not liable.

It is important to note that in some cases you can get the building/renovation permitted after the work is done. But
remember that every municipality is different and while some of them may do it for you for a small fee, the others will make you take it down, apply and rebuild.

It is much easier to just get the permits.

Kind Regards,

Tibor Bogdan

~ When do you need a building permit? ~ Part One

Once in a while I come across a property disclosure statement form (PCDS) that is filled out by the seller, and when asked, "Are you aware of any alterations or additions made without of a building permit?" they have answered YES.

When I see this, I have to investigate to provide the buyer with an explanation so that they can make an intelligent decision. If the property has a farm status then this is not so unusual since farms have many exemptions in this regards and there are many outbuildings that are constructed without permits. However, if it is a residential house then we need to know what was done, when and why the permit was not issued. I know about a client that made an addition to his house and when the local government authorities found out about this the owner was
forced to remove the addition, apply for permit and then rebuild it.
 
Since this is a big subject to talk about I will talk about it in two parts.
Part one: When do you need a building permit?
Part two: The consequences of not having one when it comes to
selling your house or purchasing a new home.

Part one:
The Regional District building bylaw specifies when a permit is
required and this includes:
•To construct, alter, or renovate any building or part of a
building.
•To finish previously unfinished areas such as basements or
enclose a carport or porch area.
•To demolish all, or a portion, of any building or structure.
•To move any building, structure, or mobile home within the
Regional District.
•To place on any land, a manufactured or factory-built home or
any housing component or modular structure.
•To install solid fuel or oil burning appliances and chimneys.
•To install, replace, or alter any sewer, water, or plumbing
works or services.
•To install or alter a swimming pool enclosure/fence.
•To construct or alter a retaining wall.
•To erect any sign or canopy.

A building permit is not required for the construction of a single storey accessory building with a total floor area of less than 10 (ten) square metres (108 square feet), re-siding exterior walls or recovering existing roofs.

Depending on the form of construction, other exemptions may apply to farm buildings.

I'd love to hear your opinions and experiences in this matter.

Kind Regards,
Tibor Bogdan

~ What to look for when buying a home with a pool ~

If the pool is open, some home inspection services will check both structural and mechanical aspects as part of their pre-purchase service. If your home inspector doesn’t have the expertise, ask a pool inspector to come and have a look.  Although this can be more difficult in the fall and winter especially if there’s a cover or the pool is empty.

In addition to an inspection, here are a few more questions to ask and things to look for:
• Ask who installed the pool and who has been looking after it. Your realtor should know whether the pool company is reputable.
• Imagine what the backyard will look like in summer, or ask to see photos. Make sure it gets adequate amounts of sun and shade, and check for overhanging trees that will drop leaves in the pool. Check that the lights work.
• Ask for a written assurance from the owners that all pool equipment works. Pool equipment and plumbing can be expensive to replace. The pool or home inspector will check them to make sure they’re working properly and have been adequately maintained.Keep in mind that most of the home inspectors will not inspect the pool you may have to get another inspector that specialize in pool inspections.
• If there are signs of repair, ask what happened. If it’s a vinyl-lined pool, look for tears. Stains may be merely an
aesthetic concern, but they could also mean a problem lurking.
• If there are no obvious tears or cracks, look for water-saturated soil in the area around the pool, pump or
plumbing
• The water should be crystal clear. If it isn’t, ask why.

• Review the operating costs. For an average 12-by-24-foot pool, the pump shouldn’t cost much more than $40 a month to run. The heating costs shouldn’t exceed $100 a month. And the chemicals should be approximately $500 a season. If costs are higher, it could be an indication that the equipment will need to be replaced soon.

Kind Regards,
Tibor Bogdan

~ July Lawn & Garden ~

Rainfall is scarce in July, and soaring temperatures can cause your garden and lawn to slow down and conserve energy. Vegetable gardens kick into high gear and will need some extra attention to stay happy. Other plants in your garden can benefit from special treatment as well. Here are some tips for your lawn and garden during the month of July.

Lawns
•Continue mowing as needed, at the highest setting for your lawn type (3”- 4” for cool-season grasses, 2”- 3” for
warm-season grasses).
•Make sure your lawn gets at least one inch of water per week.
•If water is scarce, consider allowing cool-season fescue or bluegrass to go dormant for the summer.
•Mulch grass clippings to help shade, cool, and feed your lawn.
•Edge planting beds with a string trimmer or lawn edger, for a nice clean look.
•Plant warm-season grasses and keep watered.
•Stop fertilizing lawns in midsummer.
•Make sure lawn mower blades are sharp, so they cut cleanly.
•Check out our Summer Lawn Care Guide for more tips.

Vegetables and Herbs
•Remove garlic scapes (flower heads) to encourage bulb growth.
•Order garlic bulbs for fall planting.
•Add compost or organic fertilizer to vegetable gardens.
•Harvest veggies. Give away any produce you can’t use, and remove plants that have finished producing.
•Continue weeding, watering, and removing insects.
•Start seeds for cool-season fall vegetables such as broccoli, cabbage, and spinach.
•Give herbs a haircut, and use the cuttings.
•For maximum flavor, harvest herbs just as the flower buds appear. Shear back annual herbs (such as basil) to encourage a second harvest.
•Mulch sprawling plants to keep vegetables off the ground.
•Harvest berries before birds and squirrels eat them.
•Remove and discard fallen fruits and vegetables.
•Harvest corn when the tassels turn brown and the kernels are full and milky.
•Harvest melons when they slip easily from the vine.
•Give tomatoes extra water, and perhaps a little shade, when temperatures are over 90° F.

Kind Regards,
Tibor Bogdan

~ Rate Holds, Pre-Approvals ~

Do ANY of them actually mean something?
I have seen this time and again when I talk to a new clients and they state that they have been "pre-approved" by a bank or mortgage broker and yet on the last day of the transaction closing we have problem getting the property financed

So what is Really a definition of the Pre-approval?

Here are 2 most common answers:
•A confirmation or certificate that gives a borrower the assurance to write a purchase offer without a "Subject to
Finance" clause.
•The process of calculating Debt Service Ratio(DSRs) and reviewing support documents to determine if the borrower meets a particular lender’s guidelines for funding. In studying Canada’s broker-friendly lenders, we’ve found many variations in pre-approvals, but just one common reality: Virtually no lender actually offers a pre-approval that matches the marketplace’s definition.

If you visit your banker and ask him/her what's the difference between Pre-approval and Rate Hold they will tell you that there is no difference.

They are both the same thing. So when you get your pre-approval from your lender, all it means
is that they will hold the rate for the next 60 or 90 days.

When you have an accepted offer in place you will still have to go through the whole approval process where the lender looks at your DSR as much as the value of the property.

To avoid stress while buying a Real Estate, have a discussion with your mortgage broker and make sure that you put a "subject to the financing being approved" before you make your contract firm and binding.

Kind Regards,
Tibor Bogdan

~ Should home buyers be warned about a property’s dark past? ~

Want to know if that property you’re eying might have been the site of a murder or suicide? Be prepared to do your own digging, real-estate experts say.

While laws and regulations require sellers and realtors to disclose physical defects of a property that may be hidden from view, there is nothing that legally requires them to disclose so-called “stigmas” attached to a property. Same goes for landlords when dealing with prospective renters.

Click here to read more...

Please reply with any comments or questions on this.

Kind Regards,
Tibor Bogdan

~ Information, and What Do I Make Out Of It? ~

We live in a world of information overload! Information used to be protected. Now it is available to everyone that wants it Free!

We used to call our stockbroker to find out what our portfolio is doing. Now I can access my account within 60 seconds and get up to the minute information.

We used to call our travel agents to find us a vacation deals. Now the deals come to my junk mail folder just about every hour of the day.

We used to call our realtors to ask them to find us a house. Now we find a house and then call our realtor.

However, the fact that we have the access to the information does not mean that we understand the issues and/or challenges that are associated with the action. That is where an expert comes in picture.

I may know that my stock is up or down but I may not know why? I need an expert. I may know about the cruse to Caribbean for $500/person but what I may not know is that the ship has been constantly worked on due to many technical problems. I may know about this cheap house that looks so good on the MLS but I may not know that this house has a potential to turn into a money pit.

So here is my advice; Find yourself a trusted adviser before you commit your life savings and the peace of mind.

You will be happy you did!

Please reply with any comments or questions on this.

Kind Regards,
Tibor Bogdan

BCREA 2013 Second Quarter Housing Forecast

Vancouver, BC – May 9, 2013.

The British Columbia Real Estate Association (BCREA) released its 2013 Second Quarter Housing Forecast today.
BC Multiple Listing Service® (MLS®) residential sales are forecast to edge up 1.9 per cent to 68,900 units this year, before increasing a further 6.5 per cent to 73,400 units in 2014.

The five-year average is 74,600 unit sales, while the ten-year average is 86,800 unit sales. A record 106,300 MLS® residential sales were recorded in 2005.

 "Stricter mortgage credit regulation combined with slower economic growth has kept BC home sales at a cyclical low over the past three quarters," said Cameron Muir, BCREA Chief Economist. "However, a faster growing economy is expected during the second half of the year and through 2014 which will support a growth trend in provincial housing demand."

 "The BC average home price forecast is revised upward for 2013, from a decline of 1 per cent to remaining unchanged, as a result of stronger than expected market conditions in Vancouver," added Muir. The average MLS® residential price in BC is forecast at $515,800 this year, before rising 1.7 per cent to $524,500 in 2014.

To view the full BCREA Housing Forecast, click here.

Now is a good time to bring up the issue about the property purchase tax (PPT) with the candidates that are running to represent us. Let's ask them what are they going to to with a huge financial burden that the provincial government is placing on home buyers.

For those of you that are not familiar here is a brief history of PPT. Introduced in 1987 by the government as a form of a wealth tax, it’s a one percent levy on the first $200,000 of the purchase price, and two percent on the balance of the transaction.
 
What makes this tax unfair today is the fact that PPT was implemented at a time when only five percent of homes in the Greater Vancouver area were selling for $200,000 or more. Today, 96 percent of residential properties in the region are priced higher than $200,000. What most of the British Columbia Real Estate Boards are proposing is an increase of the one percent threshold to $525,000. This would mean that the new property transfer tax on a $600,000 home would be $6,750. This will save home buyers $3,250. The Real Estate Board of Vancouver notes that the tax generated $780 million in fiscal year 2012-13. For the last 26 years, the levy has brought into government coffers revenues totaling $11.9
billion.

In Vancouver so far, the Real Estate association’s campaign to reduce the property transfer tax has attracted the support of only four candidates. Out of the four, three are realtors. Four is a good start however we still have 2 weeks left so please talk to your candidates and bring up this issue. Together we can make a difference.

Also don't forget to vote on May 14.

Sincerely,
Tibor Bogdan