B.C. First-Time New Home Buyer’s Bonus

Subject to approval by the legislature, the B.C. government intends to implement a temporary BC First-Time New Home Buyers’ Bonus. Effective February 21, 2012, to March 31, 2013, the bonus is a one-time refundable personal income tax credit worth up to $10,000.

Requirements to Qualify for the Bonus


You will qualify as a first-time new home buyer if:

  • You purchase or build an eligible new home located in B.C.;
  • You, or for couples, you and your spouse or common law partner, have never previously owned a primary residence;
  • You file a 2011 B.C. resident personal income tax return, or if you move to B.C. after December 31, 2011, you file a 2012 B.C. resident personal income tax return (you will not be eligible for the bonus if you move to B.C. after December 31, 2012);
  • You are eligible for the B.C. HST New Housing Rebate; and
  • You intend to live in the home as your primary residence.


An eligible new home includes new homes (i.e., newly constructed and substantially renovated homes) that are purchased from a builder and that are owner-built. The bonus will be available in respect of new homes purchased from a builder where:

  • A written agreement of purchase and sale is entered into on or after February 21, 2012;
  • HST is payable on the home (e.g., HST will generally be payable if ownership or possession of the home transfers before April 1, 2013 – see further details below); and
  • No one else has claimed a bonus in respect of the home.

The bonus will be available in respect of owner-built homes where:

  • A written agreement of purchase and sale in respect of the land and building is entered into on or after February 21, 2012;
  • Construction of the home is complete, or the home is occupied, before April 1, 2013; and
  • No one else has claimed a bonus in respect of the home.

A substantially renovated home is one where all or substantially all of the interior of a building has been removed or replaced. Generally, 90% or more of the interior of the house must be renovated to qualify as a substantially renovated home (90% test).

Amount of the Bonus


The bonus is equal to 5% of the purchase price of the home (or in the case of owner-built homes, 5% of the land and construction costs subject to HST) to a maximum of $10,000.


The bonus will be reduced based on an individual’s/couple’s net income (line 236 of your income tax return) using the following formula:

  • For single individuals, the bonus is reduced by 20 cents for every dollar in net income over $150,000 (bonus is reduced to zero at $200,000 net income).
  • For couples, the bonus is reduced by 10 cents for every dollar in family net income over $150,000 (bonus is reduced to zero at $250,000 family net income).

Additional Information


Individuals must apply for the bonus through the B.C. government. Individuals can apply once application forms have been posted on the B.C. Ministry of Finance website later this year. Applicants will be required to submit documentation demonstrating eligibility for the bonus.


The bonus is available in respect of new homes (i.e., newly constructed and substantially renovated homes) where HST is payable. HST will generally be payable on homes purchased from a builder where ownership or possession transfer before April 1, 2013. Potential buyers should consult with the builder to determine if the home will be subject to the HST.

For owner-built homes, the bonus will be based on land and construction costs subject to the HST. Eligible new homes will include:

  • Detached Houses, semi-detached houses, duplexes and townhouses,
  • Residential condominium units,
  • Mobile homes and floating homes, and
  • Residential units in a cooperative housing corporation.
Bonus Phase-Out for Higher Income Earners – Examples:











Proceeding with Caution: RBC Poll Finds Majority of Canadians Say It Makes Sense to Buy a House Now…

Proceeding with Caution: RBC Poll Finds Majority of Canadians Say It Makes Sense to Buy a House Now, But Fewer May Actually Take The Leap

Overwhelming majority of Canadians still confident in homeownership and see market shifting in favour of sellers

TORONTO, April, 2012— An increasing majority of Canadians believe that now is the time to get into the housing market (59 per cent, up four percentage points from last year), instead of waiting until next year (41 per cent), according to the 19th Annual RBC Homeownership Poll.

This year, slightly more Canadians say they are unlikely to buy within the next two years (73 per cent, up two percentage points), even as confidence in homeownership is on the rise. A majority of Canadians believe housing is a good investment (88 per cent, up two percentage points from last year) and more than two-thirds (68 per cent) believe the value of their home has increased in the past two years, similar to last year (69 per cent). Three-quarters of Canadians (74 per cent) feel they are well-positioned to weather a potential downturn in home prices.

“There’s a mix of opinions on the housing market, as Canadians still feel confident about real estate but are a little uncertain about where the market is heading and when it makes sense to buy,” said Marcia Moffat, head of home equity financing, RBC. “Considerations such as affordability and available housing choices may be the difference between intent and reality when purchasing a home.”

Market sentiment shifting to sellers, more expect stable housing prices

The RBC poll found that after four years of sentiment favouring a buyer’s market, the tide appears to be turning. More Canadians surveyed this year feel the current housing market is a seller’s market, in which sellers have the advantage because the number of buyers exceeds the number of homes available (27 per cent, up from 20 per cent in 2011). Nearly four-in-10 Canadians say it is a buyer’s market, in which buyers have the advantage because the number of houses available exceeds the number of buyers (38 per cent, down two percentage points from a year ago). Fewer believe that the housing market is balanced (36 per cent, down from 40 per cent a year ago).

Less than half of Canadians (47 per cent) feel housing prices will be higher this time next year, down five percentage points from last year (52 per cent), while more Canadians expect prices to be stable (30 per cent, up from 27 per cent in 2011). Nearly half of respondents (46 per cent) expect mortgage rates to stay the same next year, up sharply from 30 per cent in 2011, while significantly fewer anticipate higher rates (41 per cent, down sharply from 60 per cent in 2011).

“Steady as she goes seems to be the order of the day here, as more Canadians see stable home prices and mortgage rates over the next year,” added Moffat. “There’s a lot of information out there. Getting expert advice from a mortgage specialist on financing options and the all-in costs of home ownership can help you make an informed decision.”

Price and mortgage increases top concerns

Prospective homebuyers who plan to buy in the next two years cited some concern about home prices increasing (23 per cent) and mortgage rates rising (22 per cent). These were followed by their current debt levels (20 per cent), qualifying for a mortgage (19 per cent), and having a good down payment (16 per cent).

Highlights from across Canada:

British Columbia: British Columbians are narrowly divided when asked whether it makes more sense to buy a house now (52 per cent) or wait until next year (48 per cent), given current housing prices and economic conditions. Two-thirds of prospective homebuyers in British Columbia (66 per cent) said they were not likely to buy a home within the next two years, well below the national average (73 per cent).

Alberta: Albertans lead the country in saying now is the time to get into the housing market (69 per cent, compared with 59 per cent nationally) rather than waiting until next year (31 per cent, compared with 41 per cent nationally). More than half of Albertans (55 per cent) surveyed say current housing conditions reflect a buyer’s market, a sentiment that leads the rest of Canada (38 per cent). This mood is underscored by a higher-than-average appetite to buy a home within the next two years (31 per cent, compared with 27 per cent nationally).

Prairies: A majority of residents in Manitoba and Saskatchewan (52 per cent) say it makes more sense to wait until next year to buy a home, the only region that was countering popular national sentiment that showed the time to buy is now (59 per cent). Just under half of respondents in the Prairie provinces (48 per cent) said it made sense to buy a house now. Three-in-five respondents in the Prairies (60 per cent) say the current housing market is a seller’s market, more than any region across the country and more than double the national average (27 per cent).

Ontario: Nine-in-10 Ontario residents (90 per cent) say a house or condo is a good investment, leading other Canadian regions surveyed about confidence in real estate. Ontarians are also the most likely in Canada to describe the current housing market as balanced (39 per cent, compared to 36 per cent nationally).

Quebec: Quebec homeowners are the most confident in Canada that they are well-positioned to weather a potential downturn in house prices (78 per cent, compared to national average of 74 per cent). Furthermore, overall confidence in homeownership is high in the province (87 per cent believe a house or condo is a good or very good investment, compared to 88 per cent nationally). A majority of Quebecers believe now is the time to get into the housing market (57 per cent), a little below the national average (59 per cent), instead of waiting until next year (43 per cent, compared to 41 per cent nationally).

Atlantic Canada: Residents in the Atlantic provinces are far more likely than the average Canadian to say it makes more sense to buy a house now (68 per cent, compared to 59 per cent nationally) than wait until next year (33 per cent, compared to 41 per cent nationally). Atlantic Canadians hold a high degree of confidence in their homes as a good investment (86 per cent, compared to 88 per cent nationally). Even so, the majority of residents in these provinces are unlikely to purchase a home within the next two years, matching the national sentiment (73 per cent).

Canadians can visit the RBC Advice Centre, an online resource to help Canadians understand all facets of homeownership. Through advice videos, articles, and online calculators, Canadians can learn about buying their first home, planning their next move, or renovating. With the guidance of RBC mortgage specialists, Canadians have access to free, no-obligation professional advice about RBC mortgage products and services.

About the RBC 19th Annual Homeownership Poll
RBC is the largest residential mortgage lender in Canada. As the country’s number one source of financial advice on homeownership, RBC conducts consumer surveys as one way to provide insight to Canadians about the marketplace in which they live. The RBC 19th Annual Homeownership Poll was conducted by Ipsos Reid between January 24 – 30, 2012. The results are based on a sample where quota sampling and weighting are employed to balance demographics and ensure that the sample’s composition reflects that of the actual Canadian population according to Census data. Quota samples with weighting from the Ipsos online panel provide results that are intended to approximate a probability sample. An unweighted probability sample of 2,006 adult Canadians, with 100 per cent response rate would have an estimated margin of error of ±2 percentage points, 19 times out of 20. The margin of error will be larger within regions and for other sub-groupings of the survey population.

For more information, please contact:


Matt Gierasimczuk, RBC Corporate Communications, 416-974-2124
Ka Yan Ng, RBC Corporate Communications, 416-974-1794

Clarifying Mortgage Penalties

Last month, the federal government published a Mortgage Prepayment Code to ensure borrowers are better informed by lenders (federally regulated institutions) when it comes to situations where mortgage prepayment penalties may be charged – namely, for the purpose of clarifying interest rate differential (IRD).

This is a positive step, because IRD calculations and penalties have traditionally been very confusing to borrowers.

IRD is a charge many borrowers face when paying off a mortgage prior to its maturity date, or by paying the mortgage principal down beyond the amount of annual allowable prepayment privilege limits. And IRD penalties can prove quite costly depending on the remaining mortgage term.

IRD is based on: 1) The amount that is being prepaid; and, 2) An interest rate that equals the difference between the original mortgage interest rate and the interest rate that the lender can charge today when re-lending the funds for the remaining term of your mortgage.

Most closed fixed-rate mortgages have a prepayment penalty that is the higher of three months’ worth of interest or IRD.

The new code requires that lenders “provide the information in language, and present it in a manner, that is clear, simple and not misleading.”

The Code requires lenders to provide, among other things:

  1. Annual Prepayment Information. This includes such things as prepayment privileges that the borrower can use to pay off their mortgage faster without having to pay a prepayment charge. Examples include making lump-sum prepayments, increasing the regular payment amount and increasing the frequency of the payment to weekly or bi-weekly. Lendersmust also inform borrowers of the dollar amount of the prepayment that the borrower can make on a yearly basis under the terms of their mortgage without having to pay a prepayment charge. As well, an explanation must be provided on how the lender calculates the prepayment charge for the borrower’s mortgage (for example, a certain number of months’ interest or IRD).
  2. Information Provided When Borrower Faces a Prepayment Charge. If a prepayment charge applies and the borrower confirms to the lender that the borrower is prepaying the full or a specified partial amount owing on their mortgage, the lender will provide, among other things, a written statement to the borrower including the applicable prepayment charge and a description of how the lender calculated the prepayment charge (for example, whether the lender used a certain number of months’ interest or IRD). If the lender used IRD to calculate the prepayment charge, the lender will inform the borrower of: the outstanding amount on the mortgage; the annual interest rate on the mortgage; the comparison rate that was used for the calculation; and the term remaining on the mortgage that was used for the calculation.
  3. Enhancing Borrower Awareness. To assist borrowers in better understanding the consequences of prepaying a mortgage, lenders will make available to consumers information on the following topics: differences between various types of mortgages; ways in which a borrower can pay off a mortgage faster without having to pay a prepayment charge; ways to avoid prepayment charges (for example, by porting a mortgage); how prepayment charges are calculated, with examples of the prepayment charges that would apply in specific circumstances; and actions by a borrower that may result in the borrower having to pay a prepayment charge.

Click here for full details of the code requirements from the federal finance department.

Courtesy of:

Maureen Young

Accredited Mortgage and Lease Professional
Dominion Lending Downtown Financial
Phone: 604-805-5888
Fax: 604-904-8608

City of Richmond – A Press Release

One Of The Strongest Real Estate Markets in Metro Vancouver

The City of Richmond remains one of the strongest real estate markets in the Metro Vancouver region. An innovative and ambitious City Centre Area Plan, the arrival of the Canada Line rapid transit service and the Richmond Olympic Oval are among the catalysts fuelling billions of dollars of new growth in Richmond.

The strong interest in the Richmond real estate market was illustrated by an average 16.5 per cent increase in property assessments during 2011. The construction value of building permits issued in Richmond in 2010 and 2011 exceeded $1.2 billion.

Richmond’s population passed 200,000 in 2011 and is projected to grow dramatically over the next three decades, with much of that growth centered in Richmond’s City Centre. Richmond is also projecting a 33 per cent growth in the number of jobs in Richmond by 2041.

The current pace of growth is driven by new high density residential projects concentrated in Richmond’s City Centre. An example of this includes the River Green development near the Richmond Olympic Oval, which will transform 30 acres of riverfront land into a master planned community. Other major developments are planned for the Capstan Village area, near the north end of No. 3 Road. Preliminary approval has been given for the first of a potential 3,000 new residential units that would re-make the northern gateway of Richmond’s City Centre. New development in the Capstan Village will also fund a new Canada Line station to serve the new neighbourhood. The West Cambie area is another significant redevelopment in the City.

Richmond’s growth is not just fuelled by residential growth. Currently, there are proposals for many new hotels in Richmond under consideration. The largest project ever seen in Richmond, a four million square foot commercial-office space development, is being proposed for Duck Island, immediately west of the River Rock Casino.

Outside of the City Centre, YVR is planning significant new development on its lands on Sea Island. This includes Canada Post’s new regional sorting centre, which should bring over 1,200 jobs. Port Metro Vancouver also plans continued expansion in southeast Richmond, which will be supported by a newly-opened Highway 91 interchange that greatly enhances traffic access to those lands. With some of the last remaining large parcels of industrially-zoned lands with waterfront access in the region, Richmond’s port lands continue to be in high demand.

Richmond’s future is bright. To find out more about Richmond, visit our website at www.richmond.ca or contact our Economic Development Office at 604-276-4000.


Casting Out Clutter

Love those toy trains from your childhood?  Totally attached to your collection of moose stuff?  Dedicated to your college fraternity memorabilia?  Take a deep breath and a long gaze – then box ‘em up and ship them out to a storage facility or at least to a hidden spot under your bed.  For no matter how much sentiment these personal items hold for you, these little treasures are nothing but CLUTTER to prospective buyers.

Clearing clutter from your home accomplishes two things; it makes areas of the home easier to clean and it neutralizes the space so prospective buyers can picture their own treasured items there.  So, if you begin cringing as you read the following suggestions, repeat this mantra after me:  Space sells.

Many folks find it easier to begin with clearing out the garage, an area where unwanted items often land.  Throw away worthless items you can do without and store important items in a warehouse or friend’s garage.  As you collect “disposable” items from your home decluttering, organize them neatly in your garage in preparation for a garage sale.

Many home sales experts recommend removing half your furniture from the home.  This is a good time to repeat, “Space sells.”

Accent tables, extra chairs, and cabinets that hold huge collections are good choices for removal.  For example, a dining room table with chairs should be kept in the room while a corner china cabinet or curio shelf would be removed.  Bedrooms should contain just one double or queen-size bed or two twin beds.  Extra beds should be stored.  Take an inventory of those items you can do without for awhile.  Make a note of where you plan to put each item when it’s removed.  Store it, sell it or give it away.

Depersonalize space.  Remove your teenage daughter’s poster of Orlando Bloom from her bedroom, your husband’s stuffed deer head from the study, and any partisan items like bumper stickers, books or magazines from the family room.  All spaces should be neutral zones so potential buyers can picture their own belongings in each room.  Remind your family members that they can have these items back as soon as the home sells!

Just as it’s good to remember that space sells, it’s also important to remember The Rule of Three.  Step one of the rule:  Take everything off the kitchen counter, bathroom vanity, table tops and mantles and wipe them clean.

Step two:  Return only THREE items to each space.  Yes, ONLY three.  As for the leftover items – store them, sell them or give them away.

Keep in mind that nothing is sacred when a home is on the market.  Anything that can be opened in any room – closets, drawers, cabinets, shower curtains, pantry doors – will be explored by potential buyers.  Clean out and organize closets, drawers and the pantry.  Keep the shower spotless and remove shampoo and conditioner bottles or any other personal care items.

In the bedroom, remove half the clothes from each closet, put shoes on a rack and hang purses and belts on pegs or organizers.  Don’t forget to recycle all those newspapers you have stashed in the hall closet.  Leave no cabinet door unopened or unclean.

In her book, Simple Steps You Can Take to Sell Your Home FasterAnd for More Money in Any Market, Ilyce R. Glink suggests creating a “clutter collector” in areas where papers and writing utensils seem to collect.

Glink’s clutter collector is a large, flat storage box that’s kept where mail and schoolwork seem to end up each day.  Keep all receipts, old phone messages, pens and pencils, children’s artwork, permission slips and other miscellaneous papers in the box.  Just before a potential buyer is scheduled to arrive for a showing, store the cutter collector underneath a bed.

Whew!  Now that you’ve decluttered your home, what do you do with the items that you no longer need but are still usable?  You have several options.  If you donate them to a charity, you may be able to receive an income tax deduction for the value amount.  An added bonus:  Often these organizations will pick up donations so you can spend your time elsewhere.

You can always sell unwanted items through consignment shops, classified ads, garage sales, tag sales or an auction.  It might be nice to have a little extra cash to help pay moving expenses.  But if you can’t bear to part with these unnecessary treasures, self-storage may be the right answer for you.  Rented storage units are particularly convenient places to keep furniture, seasonal sports gear, holiday decorations, and patio furniture.

If clearing clutter seems like an overwhelming task, just remember two things.  First, reducing clutter makes each room easier to clean.  There are fewer objects to move when dusting and vacuuming.  And don’t forget what’s down the road:  The move.  The more you clean out or box up, the easier it will be to prepare to move after your home sells.  Since you’ll have more important things to do at that time, doesn’t it make sense to get it done before your buyer looks at the home?