There's always lots to consider, particularly if you're a first-time home buyer. In addition to helping you find your dream home, your REALTOR® can also help you navigate the new stress test rules and requirements. 

Start by downloading a copy of the Homebuyers' Road Map—a guide covering virtually every aspect related to buying a home. Then, to get an idea of what you might be able to afford, our mortgage calculators includes interest rate risk in its parameters, assuring your estimates will pass the mortgage stress test.

Armed with a little know-how and backed by the support and expertise of your REALTOR®, you'll be on your way to holding the keys to your new home in no time!  


Looking to Buy A Home? What Canada’s Stress Test Means for You

Sure, you can afford your home now, but what if mortgage rates go up?

Low interest rates and mortgages have been a fact of life in Canada for some time now. At the time of publication, the 5-year average mortgage rate has hovered around 5% for nearly a decade. This is a far cry from late 1981 when mortgage rates were as much as 21%.

New mortgage rules

In 2017, the Office of the Superintendent of Financial Institutions (OSFI) took steps to help protect lenders and home buyers alike against future interest rate increases. Since January 1, 2018, new mortgages are subject to comparison with higher interest rates than the one issued at the time of the mortgage. Homeowners must be able to afford a mortgage at the Bank of Canada's current five-year average posted rate or at an interest rate that's 2% above what they're currently applying for, whichever rate is highest.

Why OFSI made the move

Perhaps motivated by the foreclosure crisis in the United States, the OSFI felt Canadian consumers needed protection from forces deemed outside of homeowners' control.

The effect of the stress test means you may not qualify for the home you desire. If you're targeting a home with a $700,000 mortgage, for example, you may only qualify for about $550,000 under the new stress test rules. This could make a big difference in your choice of neighbourhoods in certain markets. 

Working the stress test process

The new mortgage rules don't have to be a barrier, however. First, there are ways around the stress test standard, which only applies to federally–regulated lenders. Credit unions, which are regulated at the provincial level, are exempt from stress test provisions. The same is true for private lenders. Alternatively, adding a co-signer to your mortgage can increase your mortgage target, even with the stress test rule in place.

How REALTORS® help

There's always lots to consider, particularly if you're a first-time home buyer. In addition to helping you find your dream home, your REALTOR® can also help you navigate the new stress test rules and requirements.

Start by downloading a copy of the Homebuyers' Road Map—a guide covering virtually every aspect related to buying a home. Then, to get an idea of what you might be able to afford, our mortgage calculators includes interest rate risk in its parameters, assuring your estimates will pass the mortgage stress test.

Armed with a little know-how and backed by the support and expertise of your REALTOR®, you'll be on your way to holding the keys to your new home in no time!  


  1. If your deposit was not enough to cover your entire down payment you will be expected to provide the rest of the down payment at move-in time.
  2. Real Estate commissions are paid by the seller, so you have no cost for this.
  3. New properties have a sales tax called GST; this should have been added to the price before the mortgage was obtained so that no funds are needed for this tax at the time of possession if you have a mortgage. When you arrange your mortgage loan, discuss having the GST included in the mortgage amount with your lender.
    For properties under $350,000 the net GST rate is 3.2% for homeowners. Investors who rent out their suite pay 5% GST when they purchase and in most cases get a 1.8% GST rebate when they find a tenant who makes the suite their primary residence.
  4. If you have less than 20% down you will have mortgage insurance (about 2-3% of your mortgage). This premium will be added on top of your mortgage once at the beginning, so you do not have to pay this premium in cash at possession time.
  5. In BC there is a sales tax called the Property Transfer Tax (PTT). This tax does not apply to NEW residences under $750,000 when the property is used as a primary residence by a Canadian citizen or permanent resident. The tax does apply to properties over $750,000, all used properties, bare land and commercial/industrial properties. The rate of this tax is 1% on the first $200,000 and 2% on the balance. On a $400,000 used condo this tax would be $6,000, but because the Yorkson offering is new condos, the tax will not apply.
  6. Your bank may have an appraisal fee to be paid when you buy, but most lenders will waive this fee. If they don’t it is often about $300.
  7. Your lawyer will charge you legal fees to handle your share of legal work for the purchase, these fees are often about $900 and must be paid when you take possession. There may be property tax adjustment of a few hundred dollars when you move in, depending on the time of year that you take possession. [Sometimes your bank will pay part of these closing fees as a gift to you for using them for your mortgage].
  8. Sometimes utilities will charge you a fee of $50 to $70 to hook up power for the first time.
  9. The fire/water/flood/earthquake insurance your mortgage company requires is already provided by your strata corporation.  You do not need to purchase more insurance if you don’t want to.  The included insurance does not include your contents or personal liability. Some buyers purchase additional contents and personal liability insurance.
  10. Finally, there is often the added cost of a moving van to move your possessions in.

A foreclosure property may present a great deal, but there are also a number of inherent risks. Richard Bell of law firm Bell Alliance offers advice and a five-step process

Purchasing a foreclosure property can sometimes be a great bargain. However, many potential buyers and real estate agents are unaware of the process and risks of buying such a property. This article outlines the five steps of purchasing a foreclosure property and describes the two biggest risks of purchasing these properties.

Five Steps of Purchasing a Foreclosure

Step 1: View the Property

Depending on the situation, it can sometimes be a challenge to view the property, particularly in circumstances where the owner refuses to cooperate with the viewing, listing and showing of the property. But it is essential that you see what you’re buying, so ensure that you do view it.

Step 2: Do Your Due Diligence

Make sure you are happy with the property since it is purchased “as is, where is”. Unlike a standard property purchase, with a foreclosed property at the time of completion or possession, the property may not be in the exact condition it was in when you had viewed it. Investigate the zoning and any applicable bylaws. Ensure you have financing in place, or are pre-approved for a mortgage.

Step 3: Submit an Offer

Make an offer to the listing real estate agent. All offers must be free of any buyer’s subjects, and only “subject to court approval”. It is very important to note once your offer is accepted by the lender you are contractually bound to purchase the property if the court approves your offer. Be sure to include your full legal name on the offer, as this is what will be listed on the court order if you are successful in purchasing the property. Additionally, if there are two people purchasing the property, such as spouses, you will want to clearly indicate whether the property is being purchased as joint tenants, or tenants in common. Once an offer has been accepted by the lender, the lender’s lawyer will schedule a court date to present the offer to the court for approval. Ensure the offer is the highest price you are comfortable with, because you may only have one chance for the court to review your offer.

Step 4: Competing Offers and Contesting the Sale

A few days prior to the court hearing, the offer price will become public, and other potential buyers will have the opportunity to outbid the original offer on the court date. Additionally, other creditors and even the current owner(s) may attempt to contest the sale price if they believe the property has a higher value.

Step 5: Court Date

All offers must be presented in a sealed envelope containing a bank draft for the deposit. The court will usually award the purchase of the property to the highest offer. The original buyer should be present in court to submit a higher sealed bid if there are other potential buyers in attendance presenting offers. Once the court accepts an offer and approves of the sale, a court order is granted in the name of the successful bidder. The completion and possession date for the purchase is usually set for 14 days following the date of the court order.

Risks of Purchasing a Foreclosure Property

The main risk of purchasing a foreclosure property, is that it is purchased on an “as is, where is” basis. Sometimes fixtures such as lights, faucets and cabinets may have been removed from the property or are damaged. The property is often left unclean with unwanted trash and items left behind.

An additional risk to consider when purchasing a foreclosed property is the former owner or occupants may not vacate the property in accordance with the court order. In this situation, the vendor is legally required to make an application to the court for a “writ of possession” and receive assistance from a court bailiff to evict and remove the occupants. This could lead to a delay in taking possession of the property.

Bearing all of this in mind, don’t shy away from considering foreclosed properties, because at the end of the day you can be purchasing a property you love at a discounted price. It is rare that an owner occupier will hinder the sale process since it is not in their best interest to do so. Understanding the process and potential risks of purchasing a foreclosed property will allow you to navigate purchase with greater knowledge and confidence.


Are you a saver or a spender? How you answer that question could have a large bearing on whether or not you should apply for BC’s new interest-free, first-time home buyer loan. The Home Owner Mortgage and Equity Partnership program begins accepting applications today.

It is meant to help homebuyers with their first down payment, with the provincial government matching funds up to $37,500 — or up to 5 per cent of the purchase price — with a 25-year loan that is interest-free and payment-free for the first five years.

“Even if it’s just for five years, I think people who are smart about spending and saving could actually use this loan to their benefit,” says Romana King, senior editor and real estate specialist for MoneySense. “Instead of using the money to buy a more expensive home, how about buying the same home as before but using that money to get a bit of a boost. You won’t pay as much in Canada Mortgage and Housing fees, you can budget so you can throw a lot more money at your mortgage for the first five years and then you can allow yourself to pay off that debt — which is locked in a prime-plus — when you have to start making payments.”

If possible, King advises first-time buyers to place the money in an account that will allow them to make more money than it costs to borrow. “For the first five years it costs you nothing. Take that money out after five years and immediately pay back the loan and you might end up ahead.”


On February 16, 2016, as part of the BC Government’s 2016 budget announcement, the Government introduced several changes to the property transfer tax regime in British Columbia.

As background, pursuant to the Property Transfer Tax Act [RSBC 1996] Chapter 378 (the “Act”), a property transfer tax (“PTT”) is payable by the transferee when certain interests in land in BC are registered in the Land Title Office, such as, for example, a transfer of a fee simple interest in land or a lease with a total term of more than 30 years.  PTT is generally assessed on the fair market value (“FMV”) of the land and the improvements on the land on the date of registration.  For an arms-length purchase and sale of land, the FMV is generally considered to be the same as the purchase price under the contract of purchase and sale.

Prior to February 17, 2016, PTT was assessed at the rate of 1% of the first 200,000 of the FMV and 2% of the FMV above $200,000.  The Act includes various exemptions from the requirement to pay PTT.


Tax Rate

Effective February 17, 2016, the tax rate for the portion of the FMV of a property above $2,000,000 will be increased from 2% to 3%.  This change represents a 50% increase in the tax rate applicable to the portion of FMV over $2,000,000.

Accordingly, PTT will be assessed at the following rate for transfers that are registered on or after February 17, 2016:

  1. 1% on the first $200,000 of the FMV;
  2. 2% on the portion of the FMV greater than $200,000 up to and including $2,000,000; and
  3. 3% on the portion of the FMV greater than $2,000,000.

New Home Exemption

The Government also announced a new exemption from PTT for newly built homes used as principal residences, effective February 17, 2016.  For the purposes of this exemption, a newly built home includes, among other things, a house constructed and affixed on a parcel of vacant land, a house converted from an existing non-residential improvement (e.g. a warehouse conversion) and a new apartment in a newly built condominium building. This exemption is only available to individuals who are Canadian citizens or permanent residents.  Where the home and the buyer both qualify for this exemption, homes with a FMV of up to $750,000 are fully exempt from PTT, and homes with a FMV of up to $800,000 are partially exempt from PTT.  Certain other restrictions and qualifications apply to this exemption.  For example, in order for the exemption to remain valid, the buyer must move into the home within 92 days after the date the property was registered at the Land title Office, and the buyer must continue to occupy the home as his or her principal residence for the remainder of the first year after the date of registration.


Disclosure of Information

The Government announced that the following changes will come into effect sometime during the Spring of 2016 (unless the transferee claims the New Home Exemption discussed above, in which case these requirements will apply immediately):

Individuals: An individual who registers a taxable transaction in the Land Title Office will be required to disclose whether he or she is a Canadian citizen or permanent resident of Canada, and to disclose his or her foreign citizenship if he or she is not a Canadian citizen or permanent resident of Canada.

Corporations: A corporation which registers a taxable transaction in the Land Title Office will be required to disclose whether each of its directors is a Canadian citizen or permanent resident of Canada, and to disclose the foreign citizenship of any director that is not a Canadian citizen or permanent resident of Canada.

Beneficial Owners: Every transferee will be required to disclose whether they are holding the transferred property as a bare trustee, and, if so, disclose the name, address and citizenship of the beneficiary of the bare trust.  Prior to this change, a transferee was not required to disclose whether it was a bare trustee and, if so, the name of the beneficial owner.  A detailed description of this requirement has not yet been released, so it is not clear whether any subsequent change in beneficial ownership of a property that does not also involve a change in registered ownership of the property (for example, where a buyer acquires the shares of a company that is a registered owner, as bare trustee) will need to be disclosed.

Currently, PTT is only payable with respect to registered transactions, so no PTT is payable on a transfer of beneficial ownership of a property if there is no change in registered ownership.  However, certain other provinces assess tax equivalent to PTT, at varying rates, on a transfer of beneficial ownership of a property, and the foregoing change may be the first data-gathering step in that direction in British Columbia.


Source: Terra Law Corp


As a prospective home buyer you have responsibility during the viewing of homes. You need to be sensitive and respectful when touring properties with your agent. Here are a few simple guidelines to follow during your home hunting days:  


Dress appropriately
Aim to look innocuous and don't let your clothes give anything away. You don’t want to look scruffy, but equally, if you look too smart the vendor might assume you've got loads of money and won’t negotiate.

Leave young children and babies at home
It is advisable not to take kids on a first viewing as they can be too distracting. If the vendor has children, then it is typically okay to bring them on a second viewing. However, if the vendor is childless, they may find it a bit of an imposition.

Arrive on time for the viewing
You should always make the effort to arrive on time. Also if you are coming with others, make sure you arrive together. Showings are usually set for a certain time and it is not only an inconvenience to your agent if you are late but the seller may be on a schedule. Often owners will leave just in time for a showing and may be waiting to return after its completion.

Take off your shoes
Even if you are not accustomed to taking off your shoes before entering someone else's home, it is best to do so when viewing a home so that you do not track mud and dirt into the home. People from various cultures and religions who do not wear shoes in home may be offended if you enter their house with your shoes on, so it is best to leave your shoes at the front door.

Respect the seller's personal property
While it is expected to open kitchen cabinets, pantries and closets, try to keep the investigation down to a minimum. Avoid opening dresser drawers, looking at personal items and using the master bathroom.

Don’t criticize things you don’t like in front of the homeowner
If the owners happen to be at home, keep conversation with them to a minimum. Most sellers try to be out when a showing takes place but sometimes it is just not possible. It is best not to "grill" them about why they are selling or where they are going. These questions are better filtered through your agent. The very worst thing you can do is say things like 'well we'd have to knock that wall down' and 'if we filled the pond in the garden it would look much better'. The vendor is probably very proud of their property the way it is. Although, some aspects of the house may not suit you and while you may not wish to purchase the home, it is best to have those discussions with your spouse out of earshot.

When leaving the home, it is nice to say things like, "Thank you for showing me around, it's kind of you to take the time" or "You have a lovely home". Vendors usually remember nice and polite people and favour them in any competition for the house. Most people have enough common sense to be courteous and careful when entering a stranger's home for viewing. When in doubt about protocol, just ask your agent. One of the standing rules about viewing a home is - leave it exactly the way you found it. 



Property Transfer Tax (PTT) is a provincial tax payable on the purchase of property in BC. It's calculated at 1 per cent on the first $200,000 and 2 per cent on the balance of the purchase price. So, for a $400,000 property, PTT would be $6,000. That's a lot of tax!

Recognized that the tax would be an obstacle to home ownership, the provincial government provided an exemption for "first time" buyers. But not everyone who has never owned a home is a first-time buyer under the Act.

You have to satisfy all of these requirements to qualify for the exemption.

1. You must never have owned a principal residence anywhere in the world. The key words here are "principal residence," which is a place of residence where an individual normally resides. If you have been or are currently a registered owner of an investment property or on title to your parents' home, but in neither situation did you occupy it as your principal residence, you still qualify under this requirement.

2. You must have lived in BC for at least the 12 consecutive months immediately before the date of registration of transfer of the property. If you are relatively new to BC and at 10 months decide to buy a property, you want to make sure you delay closing for 2 months. If you have not lived in BC for at least 12 consecutive months before the transfer, you could still qualify if you have filed income tax returns as a BC resident for at least 2 of the preceding 6 years.

3. You must be a Canadian citizen or permanent resident. If you are not a Canadian citizen or permanent resident at the time of the purchase but become one within 12 months of the transfer of ownership in the property, you can retroactively apply for the exemption.

4. The fair market value of the property must be less than $475,000. This can be a tough one in Vancouver. The price threshold is $475,000 to receive the full exemption. There is a partial exemption for properties valued between $475,000 and $500,000. There is no exemption for properties beyond $500,000.

5. You must actually live in it. At the end of the first year after your purchase you'll receive a letter from the government asking you to confirm that you moved in within 92 days of transfer of title and that you occupied the property as your principal residence for the remainder of the first year. If you did not move in within 92 days, you will be charged the tax. If you moved out within the first year you will be charged for a prorated portion of the tax. If you pass away or the property is transferred pursuant to a separation agreement or court order, you still keep the exemption. A word of warning: the government audits exemption claims and if they determine that you filed a false claim you are charged a penalty equal to twice the amount of tax you should have paid.

If you're not sure if you qualify, ask your legal advisor.

*This content is for information purposes only and does not constitute legal advice.


First-time home buyers received welcome news in yesterday's provincial budget. The government has announced, effective February 19, 2014, under the Property Transfer Tax (PTT) First-Time Home Buyers' Exemption program, qualifying first-time buyers can buy a home worth up to $475,000. The previous threshold was $425,000.

A partial exemption continues and will apply to homes valued between $475,000 and $500,000.

With the change, the government estimates 1,700 additional first-time buyers will annually be eligible to save up to $7,500 in PTT when they buy their first home.

In 2008, the government increased the threshold to $425,000 from $375,000 and previously in 2005, the threshold was increased to $325,000 from $275,000. The PTT is calculated at a rate of one per cent on the first $200,000 of the purchase price and two per cent on the balance.


Thinking about buying your first home? Wish you had saved up a good down payment? Maybe you have, but didn't know it. Designed to help first-time buyers get into home ownership, the federal Home Buyers' Program lets you access tax-free monies for use towards the purchase or even construction of your first home.

Why tap into your RRSP? The most common reason is to boost the down payment on a home. The bigger your down payment, after all, the smaller your mortgage. And you may qualify for better interest rates too; your healthy down payment shows the lender that you are a low-risk candidate for a mortgage loan.

Here's how it works. If you've been contributing to an RRSP, then you already know that the program is designed to set aside money for retirement, with the money going into the program tax-free (paying taxes on the funds when they're withdrawn later). But there are some valid reasons why you may want to access these funds earlier. A home purchase may be one of them. As a first-time home buyer, you are allowed to withdraw money tax-free, provided you adhere to the repayment plan. (Just make sure, of course, that your RRSP is not a locked-in plan.) You can withdraw up to $25,000 from your plan. If your spouse qualifies as a first-time home buyer, then he or she will also be able to withdraw $25,000. Between the two of you, you could possibly have a hefty down payment sum of $50,0000. That's enough to make a substantial difference in the affordability of home ownership!

Categories:   TIPS FOR BUYERS
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