Buying a Vacation Home?

General Roo Wyda 28 Jun

vacation home, vancouver, whistler, cultus lake, roo wyda, mortgage broker

It’s the stuff memories are made of. Whether it’s a cottage at the lake or a cabin in the mountains, a vacation property can provide years of amazing memories with loved ones. It can even become an idyllic retirement home. The good news is it may be closer within your reach than you realize. Here’s a few things to keep in mind:

1. Location, Location, Location
Where to buy is a huge decision. Do you love to swim in the lake? Or do you prefer the mountains for winter adventures? Is close proximity to Wine Country attractive? How far away can the home be located for everyone to reasonably be able to travel to the property is also an important consideration.

2. What will you use your Vacation Home for?
Will the place be used for family gatherings? To enjoy during regular vacation times, or will it be more regularly used since you are now retired? For example:
-A vacation property that will double as a retirement retreat should have easy access to
amenities, such as grocery stores, gas stations and hospitals.
-A family cottage should have adequate sleep areas for a growing family: the kids will want sleepovers, and later there maybe be grandkids to consider. Family size will factor into needing adequate kitchen and eating areas.
Make a list of your important features. Things that were important in your family home may not be as important in a vacation property.

3. How much money to spend on it?
Qualified Buyers can now purchase with as little as 5% down. For properties equal to, or less than $500,000, 5% down payment is required. Once the purchase price goes above the $500,000 threshold, you will need to put a higher percentage of money down. Also keep in mind the costs of heating the home and any strata fees that may be a factor.

Potential deal breakers to purchasing your vacation home with 5% include:
-Investment properties
-Rental pool properties 
-Timeshare properties

Words of Wisdom from Personal Finance Experts:
“Consider the travel time and costs to commute.  (i.e. getting to a Gulf Island can mean mooring a boat etc.)” –Alan Young, Portfolio Manager with Richardson GMP

“Considerations on our end would be:
*Capital Gains tax at death.
*Liquidity to pay that expense.
*Concern with keeping it in the family and separating it evenly amongst the kids.”
Jay Gangnes, Certified Financial Planner with JR Financial

Should you be purchasing a vacation property in a popular area, you may need to brush up on this: Writing a Subject-free Offer?

Writing A Subject Free Offer?

General Roo Wyda 23 Jun

Roo Wyda, Mortgage Broker, West Vancouver, Whistler, North Vancouver,
In today’s red hot markets, many Buyers have no choice but to write a subject free offer – or risk losing out on their desired property. Here are a few things to keep in mind:

1. There is no such thing as a 100% guaranteed pre-approval
Lenders need property details, documents, and an appraisal to actually approve the loan.  A pre-approval is essentially a rate hold with a Lender who is familiar with your financial details and reasonably expects to be able to do the loan for you.  The Lender will ultimately need all of the property details before they can actually do the loan for you, and unexpected surprises can derail your loan.

2. What types of unexpected surprises can cause the Lender to not be able to do your loan?
* Previous grow-ops
* Condos with special assessments where the work is in progress or incomplete
* Work/Live units
* Age restricted properties
* Self managed Stratas
This is only a small list of potential deal breakers for a Lender so it’s vital for your Real Estate Agent and your Mortgage Specialist to communicate early on to limit surprises.

3. Ensure your Realtor and your Mortgage Broker have the all-clear to openly discuss your situation.  There are things a Realtor needs to know when writing the Offer such as no quick closes under 10 days (most Lenders can’t turn the loan around that quickly).  Open communication helps limit deal-breaking surprises.

Here are a few words of wisdom from Real Estate Agents that are in the trenches of the hottest markets:

“Be prepared for anything by having all the most recent/relevant information about the local market & property on hand! This will help you make an informed decision while limiting the role that emotions and external influences can play during a multiple offer negotiation.”
– Wayne Pasco, Kore Realty, specialising in Downtown Vancouver & Burnaby North

“Be as prepared as possible before putting forward the offer.  Work with a good a mortgage broker, in advance to have any financing organized.  Often Sellers in a competitive real estate market will have a date and time that they’re accepting offers, so the Buyer can have the house inspected by a home inspector in advance of the offer deadline.  If it’s a strata property, you can request the strata meeting minutes from the Sellers Realtor in advance to review before putting forward the offer. This way a Buyer can be as informed as possible, before putting any subject free offer forward.”
– Dave Brown, The Whistler Real Estate Company, specialising in Whistler

“I would suggest that a Buyer and their agent do as much due diligence prior to writing the offer like: 
-Reading strata minutes if it is a strata property they are buying. 
-Going to the city of it’s a house and finding out about zoning, permits taken and as much history as the city is willing to share.
-Doing a home Inspection prior to the offer review date.
-Getting a bank appraisal done before the offer acceptance date. 
-Visiting the neighborhood a few times and at different times like the morning and in the evening. During rush hours to see if this is the neighborhood that want to be in.”
Tony Cikes, Sothebys International Realty Canada, specialising in North & West Vancouver and Downtown

The earlier you get your Realtor and your Mortgage Specialist talking, the better.  If I can be of assistance with your Lending needs, please do not hesitate to reach out: roo@roowyda.com or 604.783.4111.