Today, I’m going to talk about presale condos, also known as preconstruction condos. If you’re interested in buying a presale condo, I’ll give you lots of good information and tips. So, when you are ready to buy, do not make any mistakes. 

Many buyers are looking at pre-construction homes as a more affordable option. You’re basically putting a deposit down to own the rights to your future home, and you get to delay things like mortgage payments until the home is completed. This is different from a resale home, which involves buying and selling existing properties.

Also, you usually don’t face the same potential issues and expenses that you would with resale homes. And new homes have mandatory 2-5-10 warranties for your peace of mind.

At the same time, presales also come with risks, including uncertainty around the finished product and the potential for delays or cancelling the project. And there’s the possibility that the market can dip, and you could lose money on your home.

With rising interest rates, there’s also the possibility that mortgage payments become unmanageable between the time you pre-buy your home and its completion.

Buying a presale home

The idea of buying a pre-construction build as an investment appears like an easy way to make money.

But you have to understand it's not that simple and you can’t do that anymore like before. As you know the government real estate law was changed. If you want to sell the preconstruction after completion, you must live there at least a year as primary residence or rent it out. This is called the new “Anti-Flipping Tax.”

Essentially, under the new tax law, anyone who sells a property which they owned for less than 12 months (specifically, 365 consecutive days) will be considered to have “flipped” the house and any profits from the deal will be taxed as business income.--

For people who have owned presale condos, I have seen a lot of the struggles some face as the closing date on their pre-build home nears.

I’d like to point out that if you’re purchasing a pre-build home, you need to consider things like if your income will support the mortgage. You also need to consider if you can cover maintenance costs and other personal expenses.

Build on your knowledge

Whether you’re buying a pre-construction build as your first home or are looking to purchase one as an investment property, you should consider the following things.

Be aware of your risks

When considering a pre-construction home, be aware that the developer could cancel the project or delay it, and you could have missed investment opportunities by having your money tied up in the build.

Will you be able to afford an increase in mortgage payments if rates rise? Pay particular attention to the current housing market.

Thoroughly go through a disclosure statement that the developer provides you. Presale contracts are typically drafted in a manner that protects the developer’s interests and not the interests of the purchaser.

Know the timing of your purchase

Pre-construction builds let you secure an asset while giving you time to build your capital to pay for additional payments and other expenses. Be sure to fully understand what will be required of you when the closing date comes, and how long you have until that date arrives.

Research the area and developer

Get to know the area where your pre-construction home is being developed. Consider infrastructure and other developments in the area. Look at some of the developers’ past projects. Were they completed on time and on budget?

Working with a knowledgeable Realtor

Having a knowledgeable Realtor work with you when looking for a pre-construction home is critical. Working with someone with knowledge of the area where your home will be, and who has knowledge of the developer, will save you time and headaches in the long run.

Hi, everyone. My name is Cindy Oh. I am a Vancouver realtor and rental property manager as well.

So, today I am going to talk about the Vancouver housing market and what's going on right now.

The Vancouver housing market was very slow last year. Of course, the reason was the interest rates kept increased,

but the market was suddenly starting very active from March to now.

I have several buyers and they are very frustrated because they are not looking for an investment property.

They want to move to bigger place, downsize, or having their own place.

However, some properties we did not even have a chance to view because there was already an accepted offer or was sold.

Also, we went to open houses, and we liked some properties, but a lot of properties were getting multiple offers.

Why does this happen again?? I will tell you the 3 reasons.

First of all, the interest rate rose by 25 basis point in June again. So, now it has been increased total 9 times.

The Bank of Canada's interest rate is 4.75% now and Canada’s big banks all moved to match the bank's hike, rising their prime lending rates to 6.95 %.

So, even though the interest rate rose by 25 basis point again,

people who have already pre approved at lower rate to buy before the pre approved expires.

Secondly, rental prices keep on rising very fast.

As of June 2023, the average rent for a 1-bedroom apartment in Vancouver is $2,775.

This is a 20% increase compared to the previous year.

The average rent for a 1-bedroom apartment in Downtown Vancouver is now $2,900.

Of course, rental prices keep on rising because of the dramatic population growth.

‎International immigration added over 34,000 people to British Columbia's population in the fourth quarter of 2022. This was an increase of 215.7% from the same period in 2021.

Instead of renting, when you buy, part of every mortgage payment you make goes towards the equity in your home.

Over time, you can build substantial equity, which you can profit from if you sell.

Owning real estate is one of the best ways to build wealth. Holding on to this valuable asset for the long haul can provide you and your family with a solid investment that you can pass down to your children.

Moreover, houses typically appreciate in value, so as you pay off your home and house prices increase, you’ll build more equity.

Thirdly, the government legislation had created more opportunities to purchase a rental property by allowing property owners to be able to rent out their strata properties without restrictions.

Of course, this benefit is good for some owners.

Nevertheless, this has caused an unintentional problem with investors buying up condo and townhomes and renting them out, people who are looking to buy to live in are being out bided. The wealthy investor is taking advantage of the rising rental rates.

So, the problem is this new rule give more opportunity to the investors to buy and rent at a high price and competing with people who want to purchase for them to live as their primary residence.

Edgemont Village is a charming neighborhood in North Vancouver known for its small-town ambiance and picturesque setting, making it a great place to raise a family or simply enjoy a peaceful lifestyle.

The area is characterized by narrow winding streets lined with a mix of older, well-maintained homes and newer, upscale properties. You'll love the village center, which offers a variety of shops, services, and restaurants. It's a great place to spend your weekends, running errands or grabbing a bite with friends and family.

One of the biggest draws to Edgemont is the natural beauty surrounding it. Grouse Mountain, known for its beautiful hiking trails and ski resort during winter, is a short drive away. And the Capilano River offers fantastic salmon fishing and great spots for picnics and swimming during the summer.

For Golf enthusiasts, Murdo Fraser Pitch & Putt is a must-visit, with its picturesque setting. And, the famous Capilano Suspension Bridge is also a must-see attraction. You can enjoy the natural beauty of the canyon while crossing the bridge, which is a unique and memorable experience.

Edgemont also has several parks and green spaces, like the Edgemont Park, with playgrounds and picnic areas, and Mosquito Creek Park, that offers an off-leash area for dogs and beautiful trails to explore. Additionally, the Delbrook community center offers a variety of recreational activities, classes, and programs for all ages, so you'll never run out of things to do.

The area is very popular among families and known for its large and spacious houses, great schools, and peaceful environment.

Edgemont Village is a great place to call home if you're looking for a combination of outdoor activities, community engagement and a charming, tight-knit neighborhood.

The residential neighbourhoods surrounding the village were mostly built in the 1940's through 1960's and contain many examples of mid-century 'west coast modernism' inspired by the Capilano River rainforest and the coastal mountains.

The Lions Gate Bridge is an iconic suspension bridge that spans the Burrard Inlet in Vancouver, British Columbia, Canada. The bridge was designed by the noted engineer John Anderson Roebling, who was responsible for the design of the Brooklyn Bridge in New York City.

Construction on the bridge began in 1937, and it was completed in 1938. The bridge was named after the nearby Lions Mountains, which are two prominent peaks that are visible from the bridge.

The Guinness brewing family built the Lions Gate Bridge which opened in 1938 to provide access to its British Properties lands in West Vancouver. Ownership was transferred to the Province in 1955. Tolls were removed in 1963 and the bridge was restored in 1998 after a long debate about its heritage value and capacity.

The construction of the Lions Gate Bridge was a significant engineering feat at the time, as it was the longest suspension bridge in Canada and the third-longest in the world. The main span of the bridge is 1,550 feet (472 meters) long, and the total length of the bridge, including approaches, is 8,271 feet (2,521 meters).

The Lions Gate Bridge was built to provide a much-needed connection between the city of Vancouver and the North Shore communities across the Burrard Inlet. Prior to the construction of the bridge, the only way to travel between these areas was by ferry or by a long and winding road.

The bridge quickly became an important landmark in Vancouver and an integral part of the city's skyline. It has been featured in numerous films and television shows, including the opening credits of the popular TV series "The Beachcombers."

Today, the Lions Gate Bridge remains one of the most recognizable landmarks in Vancouver and an important transportation link for the city. The bridge has undergone several renovations and upgrades over the years to ensure its continued safety and reliability, and it continues to be an important symbol of Vancouver's history and identity.

Home prices across Metro Vancouver’s housing market showed modest increases in March, while new listings remained below long-term historical averages.  

March data also indicates home sales are making a stronger than expected spring showing so far, despite elevated borrowing costs. 

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,5352 in March 2023, a 42.5 per cent decrease from the 4,405 sales recorded in March 2022, and 28.4 per cent below the 10-year seasonal average (3,540). 

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,143,900. This represents a 9.5 per cent decrease over March 2022 and a 1.8 per cent increase compared to February 2023. 

“On the pricing side, the spring market is already on track to outpace our 2023 forecast, which anticipated modest price increases of about one to two per cent across all product types,” Andrew Lis, REBGV’s director of economics and data analytics said. “The surprising part of this recent activity is that these price increases are occurring against a backdrop of elevated borrowing costs, below-average sales, and new listing activity that continues to suggest that sellers are awaiting more favorable market conditions.” 

There were 4,317 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in March 2023. This represents a 35.5 per cent decrease compared to the 6,690 homes listed in March 2022, and was 22.3 per cent below the 10-year seasonal average (5,553). 

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 8,617, an 8.1 per cent increase compared to March 2022 (7,970), and 17.3 per cent below the 10-year seasonal average (10,421). 

Across all detached, attached and apartment property types, the sales-to-active listings ratio for March 2023 is 30.7 per cent. By property type, the ratio is 23.3 per cent for detached homes, 36.7 per cent for townhomes, and 34.9 per cent for apartments. 

Analysis of historical data suggests downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months. 

“If home sellers remain on the sidelines, monthly MLS® sales figures will continue to appear lower than historical averages as we move toward summer,” Lis said. “But it’s important to recognize the chicken-and-egg nature of these statistics. The number of sales in any given month is partially determined by the number of homes that come to market that month, along with the inventory of unsold homes listed in previous months. With fewer homes coming on the market, homes sales will remain lower than we’re accustomed to seeing at this point in the year, almost entirely by definition.” 

Sales of detached homes in March 2023 reached 734, a 43.6 per cent decrease from the 1,302 detached sales recorded in March 2022. The benchmark price for detached properties is $1,861,800. This represents an 11.2 per cent decrease from March 2022 and a 2.7 per cent increase compared to February 2023. 

Sales of apartment homes reached 1,311 in March 2023, a 43.2 per cent decrease compared to the 2,310 sales in March 2022. The benchmark price of an apartment property is $737,400. This represents a 4.6 per cent decrease from March 2022 and a 0.7 per cent increase compared to February 2023. 

Attached home sales in March 2023 totalled 466, a 37.3 per cent decrease compared to the 743 sales in March 2022. The benchmark price of an attached unit is $1,056,400. This represents a 7.8 per cent decrease from March 2022 and a 1.7 per cent increase compared to February 2023. 

Calculating rental income involves determining the total amount of rent received from a rental property over a specific period of time. Here's a step-by-step guide on how to calculate rental income:

1. Determine the monthly rent: This is the amount of rent that is charged per month for the rental property.

2. Multiply monthly rent by 12: This will give you the annual rent amount.

3. Account for vacancies: If the rental property is vacant for any portion of the year, you'll need to adjust the annual rent amount accordingly. For example, if the property is vacant for two months, you would multiply the monthly rent by 10 instead of 12.

4. Add in any additional income: If you charge tenants for utilities, parking, or other fees, you'll need to include this income in your rental income calculation.

5. Subtract any expenses: Finally, you'll need to subtract any expenses associated with the rental property, such as mortgage payments, property taxes, insurance, repairs, and maintenance. The amount that remains after deducting these expenses is the property's net operating income (NOI).

It's important to note that rental income is just one aspect of a rental property's profitability. You'll also need to take into account other factors such as vacancy rates, property management costs, and potential for appreciation to fully evaluate the profitability of a rental property.