First off, thank you to  @trevorbigg  and the Icons of Real Estate team for having me, it was great chatting with you.
During this 45mins, we chat a number of things from the state of the Vancouver real estate market, some tips and tricks, the start of my personal real estate journey, timing the market, etc.

Hoping there is something here for everyone from buyers and sellers to other realtors, & more.

Find this discussion on Youtube here: https://youtu.be/Z7Jd7vtbYc4?feature=shared
Or on Apple Podcast here: https://podcasts.apple.com/gb/podcast/the-surprising-twist-that-made-joe-longacre-a/id1779779654?i=1000685226807
 
If you have any questions, please don't hesitate to get in touch:
Phone: 778-927-4306
Email: [email protected]
Website: www.joelongacre.com

I thought I’d take a minute to chat about a hot topic I’m hearing a lot about these days: waiting to buy a property until interest rates drop. Many of my clients are eager to wait it out, hoping for a better mortgage rate. And while I absolutely want my clients to get the best deal, just waiting for rates to drop doesn’t always mean you’ll come out ahead.

If you're exploring the Vancouver Real Estate market and nearby areas right now, you’ll notice a trend that favors buyers more than it has in recent years. Unlike the past few years, where sellers had multiple offers and buyers were competing hard—often overbidding and skipping important contingencies like inspections—buyers now have leverage. Today, you’re more likely to set your own terms, avoid bidding wars, and pay closer to the assessed or fair market value. So, in my view, it’s a great time to consider buying.

I'm frequently having conversations with my buyers and often hearing, “I’ll just wait a few months; interest rates will be lower.” But historically, when rates drop, buyers flood back into the market. This quickly shifts us from a buyer’s market to a seller’s market, where competition spikes, prices rise, and that leverage you had vanishes. It’s a classic case of herd mentality—when one or two people move, everyone else follows, driving up demand and, ultimately, home values.

So, what’s the smarter choice? Paying a bit less for a home with a slightly higher interest rate or waiting for lower rates and paying more for the property itself? Personally, I feel there’s more upside in buying now at a lower price if possible, especially with the ability to do inspections and negotiate favorable terms. With a variable rate mortgage, you can always lock in the rate later if rates go down.

Here’s a quick example: let’s say a 1% drop in interest rate would save about $295 per month on a $500,000 mortgage. So, if you bought a $650,000 home now with $150,000 down, you’d have a $500,000 mortgage. Over a year, that’s an extra $3,540 paid  due to the slightly higher rate. But if rates do drop and buyers rush in, that same $650,000 property will likely be priced much higher than $653,540 (the original price + that extra year’s interest difference). So why not buy now, secure the property, and then take advantage of the lower rate later? That way, you get the best of both worlds!

As the saying goes, “You marry the house, but date the rate.”

I've reached out to a mortgage broker I work with, Chris Morrow from 4Front Mortgages, who has provided a helpful chart on rate/payment differences and potential property appreciation. Here’s the point: if you invest in the current market you'll pay roughly $3,500 extra in a mortgage for a year, but if over that time you see a 7% increase in your property value, you’d be gaining roughly $42,000 in equity on a $600,000 purchase— pay $3,500 to make $42,000 sounds like a pretty solid investment!

​As of July 18th 2024, the province of British Columbia has made some changes which impact what a landlord, or new purchasor can and can not do, when it comes to establishing a tenancy, maintaining, one, or attempting to terminate one.
These changes have presented some new things to think about/consider when you are a landlord. The point of this blog post is to educate you about these changes as they certainly can impact the ease or difficulty of a transaction when you may be attempting to sell a place that is a secondary residence. So, let’s get started on what these changes are:

1. The RTB (access the Residential Tenancy Branch here) has developed a web portal that you need to register your notice to end tenancy. In the past you had to serve this to your tenants in writing, or in person, and you still do, but now it has to be logged on the portal first. You can access the portal here, create your credentials, and start the process if you need. You will need to provide the reasoning why the tenancy needs to come to an end, allowing the province to have a better understanding of the scenario, with the intention being to monitor wrongful evictions a bit closer.
   
2. Once the form(s) have been completed in the portal, and served to the tenant, they will have up to 30 days to dispute the notice they have been served, as opposed to what used to be 15 days.  
3. One of the biggest changes in this new legislation is the duration of time the tenant gets once this notice has been served. It used to be 2 months that you had to give the tenant, but now you have to provide 4 months notice if you plan to move in yourself, and 3 if you are the new purchaser inheriting the tenancy. Giving the tenant more time to find a new place. (I will get the complexities that can create from a sell side of things, but for now just want to lay out the changes.
   
4. If you are serving this notice to move in yourself, an immediate family member (spouse, parents, children), or a caretaker - you/they must live in the unit for a minimum of 12 months.  
   
5. Wrongful evictions, such as moving in for less than 12 months and selling, or moving someone in that isn’t a direct family member/caretaker, saying you are going to renovate or redevelop and not having the permits, or plan to immediately do so, can result in having to pay the prior tenant up to 12 months of the rent they were paying as penalty/compensation.
6. If you are a new purchaser on a unit that is currently tenanted, or a home that has a tenant in any portion of it (basement suite for example), you still have to register this on the new tenancy portal, but instead of the 4 month notice, it has been reduced to 3 month notice. This is a brand new change in these already new rules, and the reasoning for this is because often a mortgage has only a 90 day rate hold, so a tenancy can really mess with the financing side of a completion of a deal if you chose to do a longer close based on a tenant.

So with these changes, there is a lot to think about and I won’t give my opinion on if it seems right or wrong, but I will say it can take very careful planning as it can really make buyers, sellers, and tenants have a lot to consider, and agents need to be able to explain this all very carefully, because the penalties have become quite severe. A wrongful eviction can hypothetically cost 10’s of thousands of dollars if you have to come up with 12 rent penalty.
 
My advise for a buyer, or seller, is to discuss the options with the tenant, as these regulations are what is required if the tenant is unwilling to come to some sort of agreement. A Mutual Agreement To End Tenancy is always an option, but often will require a very easy going, respectful and cooperative tenant, which isn’t always the case(especially if they are paying well under market rate, or are very tied to the place for whatever reason). That said, I often see a bit of compensation to the tenant make them quite a bit more cooperative. For example, you already have to give them their last month rent as part of a rental agreement (based on a first and last initial payment), so if you propose a 2nd free month for example this can really help motivate the tenant to be willing to move earlier. It might cost you a couple thousand dollars, but depending on your scenario as the buyer or seller, it might be way easier than complicating the purchase or sale, or having to cover 2 mortgages for an additional month or two because you can’t get in cause they won’t get out. Or if you are on the selling side, it is often best to get this signed and squared away prior to listing, as it can be a real turn-off to buyers if they know the tenancy might be a real hassle for their purchase timelines and needs. You want to make the property as marketable as possible, and dates of completion as flexible as possible to make it as workable for buyers needs as you can.
Anyway, this is just a quick comb over of the regulations that were just rolled out through Vancouver, and British Columbia for that matter. I am happy to discuss the specifics and strategies to assist you in your real estate needs to talk about how to over come some of these hurdles in the most affective fashion.
If you have any questions around these rental regulations, or any real estate related questions don’t hesitate to ask them below, or give me a call directly at 778-927-4306. Lastly you can book a call with me at a time that is convenient for you at this link here, and I will get in touch.

Some new rental regulations are taking affect here in British Columbia as of May 1st, 2024 & it is certainly stirring up some conversation.  The intent from the provincial government is to stop real estate investors from buying up what is already a lack of inventory in the housing market, and turning them into AirBnB's, VRBO's, or other vacation based rentals. Did you know there is roughly 20,000 homes/units in the province being used for these purposes? The goal of this new legislation is that this will bring more inventory to the long-term rental market, as those rates have soared in the recent years. The hope is that bringing more inventory to the market will ease a bit of that pain. Additionally, the other idea is that investors that do have multiple properties, and don't want to play the landlord/long-term tenant game, might be more inclined to sell these places, in-turn bringing more inventory to the real estate market for buyers as well.

I will not get into my opinion on all of this, as that is not my intention of this post. Instead, I simply want to lay out the guidelines of this new legislation to make it easily understandable for those who wish to know the details around, what is allowed, what isn't and break the regulations down to digestible chunks. So that said, let's get into it....

1. Definition of Short-Term Rentals
Under the new regulations provided by the province, any rental arrangement with a duration of less than 90 days falls under the category of short-term rentals. This includes a wide range of accommodations, from vacation homes to spare rooms rented out on platforms like Airbnb. In the city of Vancouver however, a short-term rental is any rental under 30 days.

2. Location Restrictions
One of the most significant changes is the restriction on where short-term rentals can operate. Hosts will only be permitted to offer short-term rentals in their principal residence plus one secondary suite or accessory dwelling unit. This means that if you're renting out a property, it must be your primary place of residence(where you receive mail, live majority of your year, are registered for taxes, etc.) with the option to rent out an additional unit on the property like a laneway house or garden suite. However, this is different in Vancouver for example. In Vancouver you can only short-term rent the actual dwelling you live in, and not a secondary unit like a basement suite or laneway house, those must be used for long-term rental(31 days or more).
This can get quite confusing as there is quite a bit of variance throughout the province. That said, it is important to look into each areas guidelines, as communities are able to file for special regulations at a more local level. This especially applies to communities of less than 10,000 people or that heavily rely upon tourism.

This link will lead you to an interactive map that provides the different information for different regions:
https://www2.gov.bc.ca/gov/content/housing-tenancy/short-term-rentals/principal-residence-requirement#PRmap

3. Registration and Licensing Requirements
To operate a short-term rental legally, hosts must obtain a valid registration number and a business license number. The registration process will require detailed information about the property, including the address, contact details, and a declaration confirming that it is the host's principal residence. Click here to apply for your permit in Vancouver.
This is the first hurdle to clear if you are looking at doing short-term rental, if you are doing this from your principle residence and it is a detatched house that makes things a bit easier. If not, and it is an apartment, condo, or townhouse, you also have to look into strata by-laws, as those can also prohibit you to do short-term rental. Many buildings do not allow for it no matter if you are living in the place or not. 

4. Enforcement and Penalties
Some of these restrictions or regulations are not new but what is new is the provincial government getting involved and monitoring this much closer. With that the penalties for non-compliance have been drastically increased. The new regulations can result in fines of up to $3,000 per day, effective as soon as the Act receives Royal Assent, which is expected in the near future. It's crucial for hosts to ensure they meet all requirements to avoid facing hefty penalties.

5. Provincial Registry
A provincial registry is set to launch in late 2024, requiring platforms like Airbnb to remove listings that do not have a valid registration number. This initiative aims to streamline the regulation process and ensure that all short-term rental operators are operating within the legal framework.

6. Local Bylaws
While the provincial regulations set a baseline, local governments retain the authority to implement more restrictive bylaws based on their specific needs. Cities like Vancouver and Burnaby already have stringent regulations in place, allowing short-term rentals only in the principal residence and imposing additional restrictions on secondary units.

In conclusion, the upcoming changes in BC's short-term rental regulations signify a shift towards more stringent oversight and regulation of the industry. Hosts must familiarize themselves with the new requirements and ensure compliance to avoid potential fines and penalties. Additionally, staying informed about any updates or changes to local bylaws is essential for maintaining legal compliance and operating a successful short-term rental business in British Columbia.

Here are a couple links to the B.C.  government websites that include this information:

https://www2.gov.bc.ca/gov/content/housing-tenancy/short-term-rentals/short-term-rental-legislation

​Vancouver Specific: https://vancouver.ca/doing-business/short-term-rentals.aspx

If you have any questions about these new regulations, I am happy to answer any questions.
Additionally, I don't mean to spark any major debates here, but I would love to hear your thoughts on the whole thing. Feel free to drop your comments or questions below and I will address them.

If you currently have short-term rentals and want to have a private conversation to further understand things, and come up with a game plan you can give me a call at 778-927-4306 and let's chat about the options for your scenario.

Understanding Rain Screening:
Rain screening is a building envelope design and construction method that effectively manages moisture and water infiltration in a structure. It is commonly used in regions with high levels of precipitation, such as Vancouver. This system is designed to create a protective barrier between the exterior cladding of a building and its structural components. It plays a vital role in preventing water damage, mold growth, and structural deterioration.

Rain Screening Components
A typical rain screening system comprises several components, each serving a unique purpose:
Exterior Cladding: This is the outermost layer of the building, such as siding, stucco, or brick. It acts as the primary defense against the elements.

• Air Gap: A gap is created between the exterior cladding and the building structure to allow air circulation and drainage, preventing moisture from accumulating.
• Weather-Resistive Barrier: A water-resistant membrane is installed behind the cladding to provide an extra layer of protection against moisture.
• Flashing and Sealants: These components are used to seal joints, seams, and penetrations in the exterior cladding, preventing water infiltration.

 

 
In meeting with clients for coffee, lunch, or just chatting with them on the phone I am constantly asked about mortgages, down payment requirements, interest rates, and all other things that tie into the world or lending when it comes to buying a property. It is such a popular topic of conversation in these meetings that I thought I would purge a bit of info here in hopes that if you have stumbled upon this page it can be useful to answer some questions you may have. That said, lets dive right in.
 
When looking to make a purchase there are a couple of different options out there that you can consider to achieve the financing you desire to get into the dream home you are looking for. These options include High Ratio Mortgage, Insurable Mortgage, and finally Conventional Mortgage. They all 3 have very different requirements, as well as pros and cons, but hey let’s be honest, if you are looking to buy, you will often times take what you can get and are simply seeking any means to make it work.
 
High Ratio (Insured)
First let’s investigate why a High Ratio Mortgage might be your best option. A high ratio mortgage allows you to get the financing you are seeking if you can’t come up with the lenders desired 20% down. Which is a great option if you don’t just have $140,000 floating around to purchase a $700,000 home. Trust me you are not alone, & this is where a high ratio mortgage is a great option. Here in BC, most lenders will allow you to get this option going with as little as 5% down on the first $500,000 and then after that you need to come up with 10% on the remaining balance. (So, in this $700,000 example, you need $25k on that first 500k + 10% on the remaining $200,000($20k), meaning $45,000.) $45,000 is a lot more reasonable for a lot of people than the $140,000 mentioned above, this is where High Ratio is great!
The unfortunate side is that the bank will require you to purchase mortgage insurance, which isn’t nothing, but if it gets you into your home, you’re happy right?  So, what is mortgage insurance looking like? Well, it is a one time payment due at the time of lending that is 4% of the loan value if you only put down 5% and on a sliding scale from there. You can look at the scale as roughly:

• 5% down = 4% mortgage insurance rate
• 10% down = 3.1% mortgage insurance rate
• 15% down = 2.8% mortgage insurance rate
• 20% down = 2.4% mortgage insurance rate – but if you are putting down the 20% the later discussed lending options are most likely a better option for you.

Let’s put that number into context using our $700,000 property example.  If you, do the minimum allowable payment depicted above(45k), you are looking at mortgage insurance running you a one-time payment of roughly $26,180. I know, OUCH!!!! No one likes an additional $26k out, but let’s look at it this way… Even with this payment you are getting into your home with 45,000+26,180= $71,180, still a lot less than $140,000 right?
This home loan option is usually fixed to 25 year amortization, and you are working with the traditional 39/44 debt ratio that nearly all lenders require. (I’ll save that for another post, but basic concept is that your expenses can’t go beyond 44% of your income to qualify for the loan). These loans also only allow you to purchase something under $1 million, and must be owner occupied(not rental/investment properties) and in Canada.
Aside from not needing the 20% down, you may also see a benefit of a lower interest rate than uninsured/conventional as the bank is guaranteed to make their money because of the insurance, therefore there is less risk for them, so they often offer a lower rate.
 
Insurable Mortgage
Next let’s jump into an Insured Mortgage. This is quite similar to the High Ratio, in the sense that you still need to meet the 39/44 Gross debt/Total debt ratio, must be under a million dollars, owner occupied, and are bound to 25-year amortization term, & must be in Canada, but there is a couple major differences. The first difference is that you DO need to put down 20% of the purchase price of the house. Which is the $140,000 on a $700,000 house example. However, the great part is that the bank will be the ones to pay the one-time mortgage insurance payment for you. Meaning you don’t need to pay the $26k that you did in the High Ratio option, because they will.
With this style of lending you may also benefit from a lower rate than uninsured/conventional because it has insurance attached to it for them, therefore less risk associated. However, with them paying the insurance on that the rate may be slightly higher than High Ratio. Think of this as the Mama Bear in the options.
 
Conventional Mortgage (Uninsured)
This is the final option in the mortgage arena, and just like the others it comes along with its pros & cons. Going this route you don’t need to have insurance, so it does save the 10,000’s of 1,000’s of $’s the other 2 had. However, you need to have more than 10’s of 1,000’s because for this mortgage you must have the 20% down payment for the value of the loan, as the bank does not exceed 80% of the value of the asset. This mortgage is automatically the one that is used for properties over $1,000,000, and due to the lack of insurance on it, it will more than likely have the highest interest rate, because the bank is taking on the most risk. They charge premiums anytime they are sticking their neck out.
The benefits of a conventional mortgage though is that you can extend the amortization beyond 25years, say 30 for example, resulting in lower monthly payments. Additionally, this does not need to be owner occupied, so this lending works for investment/rental purposes. Lastly, there is usually a bit more leniency on your credit score, meaning it doesn’t necessarily need to be as high, and a bit more flexibility on the 39/44 ratio as well, allowing that to often be adjusted upward.
 
I hope this helped to bring a little clarity to what the differences are between insured and uninsured, high ratio vs. conventional, and all the other mortgage terms you hear floating around. I do want to qualify this as I am licensed realtor, but not a financial planner, or mortgage broker, so this is just some basic knowledge to share.
Please feel free to ask any questions in the comments below, and I will gladly address them. Or don’t hesitate to pick up the phone and give me a call, I am always happy to chat -778-927-4306.
Additionally, I have a number of mortgage experts I have had the pleasure of working with and would be happy to point you in their directions if you require further assistance, are looking to get pre-qualified, or have any other mortgage related needs.