#110, 9780 Cambie Road, Richmond, V6X 1K4 Ph. 604-618-2128 Em. teresa@pointbinvestment.ca, Multiple Realty Richmond
It’s A Terrible Time To Invest… Right?

It’s A Terrible Time To Invest… Right?

Why the Timing is Perfect to Invest in Real Estate in Vancouver

Nowadays I hear the same reason for why investors are holding off; the interest rates are just too damn high. I can’t blame them, on the surface, it’s a tough thing to look past and since it’s one of the first steps when it comes to investing, it makes sense that most people don’t get past that step.

I, on the other hand, see a massive opportunity that will pass most people by right under their noses. I challenge you to look past the interest rate and how the market will look in the next five years. Will interest rates be higher or lower? Will prices go up or down? What does it all mean?

Economists are expecting the Bank of Canada interest rates to start dropping early in 2024. Along with those drops and housing becoming more affordable, demand is sure to increase as people start to buy property ahead of the masses when the interest rates drop to 5%. Now another few months will go by, maybe a year or two, and when interest rates drop to a point we can call “normal” again, even below 5%, it will bring along a surge of buyers who have all been waiting for this moment. With the demand of all these buyers in the market and, as we know, supply is fixed or growing at a very slow rate, property prices are sure to shoot up given how many buyers are actively trying to purchase a home.

At that point, many people will once again see the rising prices of real estate and say “Now isn’t a good time, I’ll wait until prices calm down”, and sure enough the prices may stop surging, but nearly all of them will look back and think “I wish I had bought this property before the prices shot up”.


This is the time when savvy investors are looking at the market conditions and deciding to hold off. This is the time when savvy investors recognize a TEMPORARY problem, think what it means for their investments in the years to come, and take action to profit off the current conditions as well as the common understanding of waiting to purchase property.

Everybody has different needs and goals when investing in real estate. If you are unsure how you can play the current market to your advantage, reach out to us and we would be happy to chat about different ways you can be successful in today’s real estate scene.


6 + 3 =

How to Pay Off Your Mortgage in Less than 10 Years?

I recently read a book called the Smith Manoeuvre by the late Fraser Smith, a financial planner, written in 2002.  Just a disclaimer, I am in no way affiliated with Fraser Smith or have anything to gain by helping sell his book, but I feel it’s my duty to report to you that this book is a complete game changer!  I learned how I could pay off my mortgage in just under 6 years, when I currently still have 25 years remaining on my amortization. Now lets us talk about this powerful financial strategy a bit more.

To summarize, the Smith Manoeuvre is a system that gradually helps restructure the non tax-deductible mortgage in your principal residence into a tax-deductible investment loan where you pay simple interest. Additionally, you will receive annual tax refunds on your investment loan, reduce years off your mortgage, and thus increase your net worth!

Now, you maybe asking…“Is this legit…?” Thankfully, I am happy to report, it IS!! All techniques that’s mentioned in the book are legal and have been reviewed by the CRA. So now, how does this Smith Manoeuvre really work? Here are the steps listed in the book, which assists in converting your non tax-deductible mortgage interest into tax-deductible debt.

In order to take full advantage of the Smith Manoeuvre, you will need to have a principal residence with a mortgage.

Step 1) Obtain a re-advanceable mortgage from a reputable financial institution: A re-advanceable mortgage is different from a traditional mortgage as it’s a mortgage with a home equity line of credit all in one product. When you pay down your mortgage, the principal portion that you pay down simultaneously increases the credit limit on the HELOC. To give you an idea of how that’s done, my current mortgage is with TD Bank with over years left on my term. The penalty is about $2400 to break this mortgage (3 months interest), and I will be switching to Manual Life 1 or RBC, which are two financial institutions I know that provides re-advanceable mortgages.

Step 2) Use the funds in the HELOC to invest: Withdraw the HELOC portion of your mortgage to invest in investment properties, or any type of investments like stocks or bonds. If you already own investment property(s) in your personal name (not in a corporation), the HELOC would be used each month to pay all your monthly expenses while all rental income is applied towards the principal pay-down each month on your principle residence mortgage. Be careful here, as you must pay dollar for dollar for your expenses. Talk to your accountant to help you with this as if it’s not done correctly here, you may disqualify your ability to claim expenses on your HELOC. Remember again that your HELOC limit will increase with each regular mortgage payment paid, which in turn allows you to invest the newly available money in your HELOC. This in accounting terms is called “Cash-damming”.

Step 3) Deduct interest paid on your HELOC when filing your taxes: When you are filing your tax return every year in March, deduct the annual paid interest amount from your HELOC. This should result in a tax refund based on your marginal tax rate.

Step 4) Re-invest the interest from the tax refund: Apply the tax return and the investment income (dividends, interests, etc.) against your non tax-deductible mortgage and invest the new HELOC money available.

Step 5) Repeat Steps 2 to 4 until your non tax-deductible mortgage is paid off!

This doesn’t sound super-complicated, right? Keep in mind that the Smith Manoeuvre does not happen overnight; it requires years to achieve.

I strongly recommend you read the Smith Manoeuvre so that you too can learn how to pay your mortgage off much much faster, AND be able to claim tax deductions. And don’t forget to run everything pass your accountant first, or talk to a financial planner who is familiar with this strategy to assist you 🙂

What’s the Best Area to Purchase An Investment Property?

We often get asked, “where is the best area to invest?” Or, “would it be better to invest out of town or close to home?” These are all great questions, and the best answer would be to look where new jobs are being created. With the creation of new jobs means more workers moving into the area and more demand for rental properties, which translates to less vacancies. According to the Real Estate Investment Network, or REIN, after about 18 months, these same workers will want to start buying their homes close to work, which will likely drive up home prices. REIN calls this the “Long-Term Real Estate Success Formula” as shown below.

Watching out for Amazon leasing a 450,000-square-foot facility in Tsawwassen, or LNG projects being approved Northern BC, and others such as this and purchasing in areas of job growth.

The LNG project, according to a news conference took place in Vancouver with Prime Minister Justin Trudeau and LNG Canada Chief Executive Andy Calitz, is a massive, $40 billion liquefied natural gas project that is taking place in Northern BC. This project will involve a pipeline carrying natural gas from Dawson Creek in Northeastern BC to a new processing plant on the coast in Kitimat. And from there, the gas would be liquefied for overseas export.

With the potential of over 10,000 new jobs around the site, it is expected that the demand of rental housing would increase in a relatively high percentage, primarily from the workers and their families. Lori Ackerman, Fort St. John Mayor, said she expects other developments will also move forward, ranging from new parks to transportation to expanded post-secondary education network, aimed at a growing population.

Another factor to consider is transportation. Anywhere where the skytrain or LRT (light rapid transit) lines are within a 10 min walk will drive up rents and property values by about 10%. Currently, Translink has the following 2 projects undergoing: the Millennium Line Broadway Extension and the Surrey Light Rail. According to Translink, the Millennium Line Broadway Extension will start from VCC–Clark Station, then travel beneath Broadway and ending at Arbutus Street. A future phase of investment will connect all the way to UBC’s Point Grey campus. As for the Surrey Light Rail, the project will go along King George Boulevard and 104 Avenue, connecting Surrey City Centre, Guildford, and Newton. Therefore, we could foresee places like Surrey and even Vancouver to Arbutus will be desirable for tenants to live at.

As a result, when we factor in where new jobs are being created and where transit, specifically skytrain and LRT are located, these are the best areas to invest in where you will see higher rents and ultimately higher property growth.

To learn more about current investment opportunities, please set up a meeting with us. We will customize potential investments to your individual criteria.

Are we finally entering a Buyer’s market?

Are we finally entering a Buyer’s market?

With recent news headlines such as “Housing prices in Vancouver dropping due to greater supply,” “B.C. residential sales decline,” and “B.C. residential real estate downturn largely behind us,” I bet you’re all rather confused as to what’s going on in the real estate market.  So what is the new reality for real estate in Metro Vancouver and Fraser Valley?

The Metro Vancouver housing market continues to experience reduced demand across all housing types. To start, there are now fewer multiple offer presentations, and sellers have also become more flexible with both selling terms and price. Because of this, it is now the norm for buyers to take their sweet time during their purchasing process by considering multiple properties simultaneously, followed by negotiating relentlessly on a deal over a series of offers and counter-offers. 

The Real Estate Board of Greater Vancouver (REBGV) reported the number of residential home sales in the region totalling to 1,929 in August 2018; a 36.6 percent decrease from the 3,043 sales recorded in August 2017 – additionally, there was also a 6.8 percent decline in home sales compared to July 2018 where 2,070 homes were sold. Moreover, last month’s sales hit an all-time-low: sales fell by 25.2 percent below the standard 10-year August sales average.

Similarly, the Fraser Valley Real Estate Board reported 1,155 sales of all property types on its Multiple Listing Service® (MLS®) in August; indicating a decrease of 38.5 percent compared to the 1,879 sales in the previous August, there was also a 10.5 percent decrease in sales compared to the 1,290 sales made in July 2018.

Sales of attached homes continue to represent over fifty percent of all real-estate transactions in the Fraser Valley as of August – where a total of 294 townhouses and 318 apartments were sold.

Many Sellers are pricing their properties much lower than they would have a year ago, close to 2017’s assessed values.  I’ve seen some sellers even selling their homes under assessed values, as it’s forecasted that 2018’s assessments will stay the same or will be slightly lower than the previous year’s.  Not that assessed values are market value, but prospective Buyers do use assessed values as a benchmark of what they should offer.  As a Seller, effective pricing is key and will ultimately be your determining factor in a successful transaction.  

For Investors, it’s officially a prime time to bid lower offers that go hand-in-hand with favourable terms such as financing approval, inspection and approval of strata documents. Moreover, we also have the ability to show the property to prospective tenants prior to completion date…and the craziest thing is among all these factors, we’re still able to have our offers accepted!

As of September 17, 2018, there are 83 brand new listed one and two bedroom condo’s under $400,000 for sale in the Metro Vancouver and Fraser Valley region.  In the month of August – only five of these units sold; with such a low absorption rate, the tables have finally turned as it has now become a buyer dominant market: at least for now, that is…hooray, while it lasts!




If you are thinking of selling your investment in Greater Vancouver or anywhere else in BC, please contact us at teresa@pointbinvestment.ca or at (604)618-2128.

The Amazon Effect

The Amazon Effect

It was revealed just two months ago that Amazon will take over the existing Canada Post building in Downtown Vancouver. This move entails providing 3,000 new jobs to the city and along with many others –  even Prime Minister Justin Trudeau is in favour of this. Firstly, more high-paying tech job opportunities would be made available without having citizens have to relocate elsewhere in search of such in the tech industry; secondly, it is likely to influence further investment from other tech companies, given that Amazon is a renowned household name – such a bold move will indefinitely affect more companies to also have an office in Vancouver, further boosting the tech industry and local economy.

That said, as real estate investors, we also can celebrate for this move as we know that with the addition of 3,000 more jobs coming in, there is a need for more homes – whether to rent or buy!

The Amazon effect

Dubbed as the “Amazon effect” in Seattle, the city where Amazon’s Headquarters are located, such investments can drastically increase housing prices; according to a Bloomberg article published in May, the effect was found in certain  Seattle neighbourhoods, with rises in rental rates, having risen 65% faster compared to the ones with smaller influxes of Amazon workers.

Though rents in Downtown Vancouver seem to already be at its peak, cities such as Seattle and San Francisco (with a greater proportion of tech workers) indicate that there is still plenty of room for growth – this is particularly true as there continues to be an influx of thousands of well-compensated employees. Moreover, this could be further made possible by the likelihood of Amazon remunerating the rental costs for numerous downtown units during the relocation process for several employees. Consequently, this leads to higher rental rates and fewer vacancies in the already competitive rental market in the city.

Comparatively, values of homes also increase – as certain locals acquire higher paying opportunities, they too, will become more equipped with sufficient finances to purchase a home; furthermore, existing Amazon employees from other parts of the nation and elsewhere will also want to inevitably think of purchasing a home to settle down in our scenic region as they will work here for quite some time. In addition to the natural beauty among other reasons to move to Vancouver, they have the added incentive to do so as those with working visas are exempt from foreign buyer tax when purchasing a home.

Other markets

Though properties outside of Downtown may be less affected, the Amazon effect will still likely have its influence; this applies to Vancouverites who won’t be benefiting from these job opportunities, and as a result, they will have to relocate outside of the city centre in search of more affordable housing for rent or purchase. Despite having higher paid opportunities, some of these employees may still opt to commute to Downtown over competing for the limited living space in the core of the city. Due to these factors, the competition for rental and purchasing homes becomes even more scarce, with this effect seeping into neighbourhoods that are easily accessible to Downtown Vancouver.

In addition to being able to significantly impact the city’s housing market, the Amazon effect could also affect the city’s commercial real estate – specifically, the office space supply and lease rates. Amazon’s new offices in the Canada Post building will take up at least 416,00 square feet of built space; should other companies too want to follow the footsteps of Amazon, lease rates will indefinitely soar unless there is an increase in supply to meet this demand. This would continually affect the increasing rental rates, despite Vancouver already inhibiting low office vacancy rates and having the highest per-square-foot lease rates nationwide.

And all of this is again part of the Amazon effect: Amazon attracts other companies that also are in search of talent, so that they build and have offices nearby or next to their offices.

Of course, like with all good things, there are also the negatives – with increasing rental rates identified as a problem by many. Furthermore, many locals argue that a solution to this crisis would be to increase housing supply to better accommodate the influx of new workers, as well imposing greater taxation policies for foreign workers.

Though we don’t have a perfect idea of what this move may mean for the Vancouver real estate market, we can say that it is almost guaranteed that the Amazon effect will drastically alter our already volatile and expensive market.

New Home Pre-sales Continue to Plummet in the Greater Vancouver Area

New Home Pre-sales Continue to Plummet in the Greater Vancouver Area

It appears that the rate of pre-sale condos and townhouses being sold now are steadily declining across the Lower Mainland and the Fraser Valley, with Downtown Vancouver being affected the most.

According to a mid-year report published by MLA Canada, a real estate marketing agency, the sales rate of pre-sale units as of June 2018 was at 50 per cent; this is a drastic difference compared to the 94 per cent pre-sale sales rate seen earlier in January this year.

Overall, 74 per cent of the 7,753 pre-sale units were sold from January to June – though indeed a more modest pace of sales, this stabilization in prices should be good news for homebuyers and the real estate market.

From what once used to be more of an unsustainable, hyperactive market, things are now normalizing and becoming more balanced; this “ensures more modest and realistic price growth, more choice for consumers and the need for higher quality product from the industry,” said Suzana Goncalves, chief advisory officer and partner at MLA Canada.

Local Market Divergence

Despite there being a steady decline of pre-sales in most of the Lower Mainland, Burnaby North, however, experienced a sold-out rate of 91 per cent from January to June 2018 for the 1,600 new homes that were released. In addition to Burnaby North, MLA’s report also indicated strong pre-sale activity in the New Westminster, West Coquitlam and North Surrey area. This contrasts with the City of Vancouver as they only saw 61 per cent pre-sales in East Vancouver, 54 per cent on the West Side, and 34 per cent in Downtown – all of which make sense as more people are seeking more affordable options with potentially higher property appreciation levels. Nonetheless, Port Coquitlam hit an even lower rate at 19 per cent between January to June, with Richmond followed by a 39 per cent purchasing rate.

Investors Selling Assignments

As new home pre-sales continue to plummet, more and more pre-sale buyers are trying to assign (re-sell) their pre-sale contract. As of July 18th, 587 pre-sale condos were being listed for sale from Squamish all the way to Langley on Craigslist, Kijiji, and through various real estate agents’s websites.

As MLA expects to see 67 more housing projects, and approximately 7,700 new homes launching between now to the end of 2018, we at Point B Investment expect to see pre-sales continue to plummet… which is great news for us, as real estate investors, we buy when others are fearful!  We anticipate to see some pre-sale deals coming this Fall and Winter and will advise you accordingly!

Will BC Experience a Market Crash by the end of 2018?

Will BC Experience a Market Crash by the end of 2018?

There’s been endless news articles during the past year talking about the Vancouver real estate market and if the bubble will pop anytime soon.  Of course, none of us have a crystal ball to foresee the future, but as a real estate agent and investor who is very active in the housing market, this is what I see happening currently.

1. Mortgage Rates Increase & Stress Test.  Interest rates are gradually increasing and they are predicted to increase even more by the end of July and again before the end of 2018.  In addition to the increase in rates, people who had an accepted contract after Jan 1, 2018 were required to qualify at 2% more than what their actual mortgage rates are, thus allowing Buyers to qualify for about 20% less than if they purchased before January 1st.  Many Buyers just simply cannot qualify any longer to purchase a home that they want and it’s predicted that some people who have purchased a pre-sale property may not be able to get a mortgage at completion which is a date in the future.

2. Historic Appreciation.  Real estate prices appreciated at historic levels in 2016 and 2017, as much as 30% per year in both Metro Vancouver and in Fraser Valley.  This growth cannot be sustainable, and we are seeing a drastic slow-down in the market today with single-family homes actually depreciating anywhere from 10-25% in value from last year.

3. Reduced Foreign Buyers.  Since August 2016, the BC government introduced a slew of taxes like the Foreign Buyer’s tax, Empty homes tax, Speculation Tax, increased Property Transfer Tax for properties over $2M, increased school tax for properties over $3M, just to name a few.  It seems the BC government is penalizing foreigners and as a result, we are seeing much less foreign buyers these days.

4. End of the Bidding Wars.  All through 2016, 2017, and from January to April 2018, it was common to witness multiple offers, with people bidding in some cases hundreds of thousands above the asking price with subject-free offers on properties. Today, we see the opposite: buyers are now able to negotiate on the asking prices and to put in the appropriate subject clauses to protect their interests. What used to be a platform for sellers to capitalize on their financial gains from appreciating properties has now become an opportune market for buyers, especially in the detached market.

5. Pre-Sale Condo’s and Townhouses Line-ups. Though the condo & townhouse market is still strong, we are not seeing long, frenzy line-ups at pre-sale projects today, especially in the Fraser Valley.  There are select projects in Vancouver, Burnaby and Coquitlam that are selling well, but there is definitely a slow-down for pre-sale purchases. We’re seeing developers offer incentives such as 5% down payment only, 0% assignment fees, and increased REALTOR® commissions to name a few.

In addition to these 5 factors, according to the Vancouver Real Estate Board, residential home sales totalled 2425 in June 2018 a 37.7% decline from 3,893 sales recorded June 2017 and 14.4% decrease compared to May 2018.

June’s sales were 28.7% below the 10-year June sales average.  The total number of homes currently listed for sale on the MLS in Metro Vancouver is 11,947, a 40.3% increase compared to June 2017 (8515).  Sales to active listings ratio for June 2018 is 20.3%.  Which means of all the active listings, just over 20% got sold.

I am predicting that prices will continue to decline in the detached market, and that condos and townhouses will remain flat for the remainder of 2018.  Will we have a market crash? We have yet to find out.

For condo and townhouse owners, I feel this will be your last chance at selling to capture the crazy high appreciations we have had, and for all us investors, I suggest we sit tight for the rest of this year and scoop up the bargains come 2019.

When is it the right time to sell your investment property?

When is it the right time to sell your investment property?

Often, my investor clients ask, “when it is the right time to sell”? My usual response is to advise against selling an investment property as the investor would need to pay capital gains tax. As opposed to selling the property outright, I suggest re-financing every 3-5 years to take out the equity to re-invest into other properties or to repay loans and lines of credit.

However, I do recommend selling the property in exceptional circumstances such as the following:

1. When the property unit is in a condominium older than 15 years – in BC, the strata corporations rarely charge enough condo fees resulting in special assessments; these assessments are usually major projects such as building envelopes, exterior painting, roof replacements etc. More often than not, these assessments will eat into your profits. Therefore, I advise that when your condo reaches its 10-year mark, to renew the mortgage with a variable rate where the penalty for breaking the terms is just 3 months’ worth of interest as opposed to a fixed term with hefty penalties.  I’ve had to break a fixed 5-year mortgage with one of the Big Five Banks where the penalty was $24,000 – thankfully though, I bought a new property and was able to transfer that mortgage with the penalty being waived. Bottom point: I would sell when the condo is between 10-15 years old.

2. When the property is located in an area where population or job growth is declining. As investors, it is important to realize that the future of our real estate’s return on investment is highly dependent on the growth of jobs and population in the located area. As that thrives, the more valuable the property becomes. Comparatively, when the opposite happens, real estate prices decrease. It is wise to sell the property before we hear of a continued amount of job decreases and people moving away from the area in search of new occupations. That said, it is vital to remain up-to-date with the market(s) we’re investing in, and to really talk to the locals who live in that area and to sell before market downturns.

3. When you make over a 75% ROI (return on investment).

For example, in July 2016, nearly two years ago, I purchased a 3 Bedroom condo for $339,000 plus GST. It is located in the U-District of Kelowna, a five-minute walk across the Okanagan campus of the University of British Columbia. My initial cost for the property was $122,000 – which included my down payment, closing fees, and furnishings. Fast forward 22 months later, I sold the property for $505,000 (furniture included); the profit I received was $141,542 after paying off the mortgage, realtor fees, and closing costs – in other words, I made a 116% ROI all within this time span. It was a tough decision as my cash-flow was over $400/mth during the school year and up to $3000/mth during summertime. However, as great of an investment it was, I sold the property because I knew of more student rentals being built in the area, with many pending completion in one to two years from now. I also knew of the BC Government’s plan to create 5000 student rentals across BC, announced in the 2018 budget plan where they will dedicate increased spending on. Simply put, that meant more competition for student tenants, inevitably leading to me having to reduce my rental rates to compete and so I chose to exit the U-District area while it is still opportune.

As previously mentioned, it is essential to educate ourselves on the local market and upcoming changes that may affect real estate investment prices. It especially is useful when you also follow the 75% ROI Rule.

If you are thinking of selling your investment in Kelowna or anywhere else in BC, please contact us at teresa@pointbinvestment.ca or at (604)618-2128,

What the new Airbnb rules may mean for you

What the new Airbnb rules may mean for you

On April 19, after a long withstanding over short-term rentals, the city of Vancouver and Airbnb have come to an agreement permitting citizens to legally use their primary residences for short-term rentals. What used to be more lucrative for homeowners is now limited by the city bylaws that caps landlords to renting it for no more than thirty consecutive days. Through careful collaboration, the city aims to tackle the record-low vacancy rate, currently at 0.7 per cent by posing limitations on short-term rentals. Moreover, throughout this process, they hope to influence homeowners to make the shift from short-term rentals to long-term rentals.

If you decide to capitalize on operating short-term rentals in your (principal) home, you must acquire an annual business license; the fee for that is $49/year, with an additional one-time activation fee of $54. In addition to possessing the license, it is also necessary to feature it in every listed rental property on the global home-sharing site.  Moreover, hosts are also to ensure they meet a checklist of requirements that can be found here. Failure to comply with the prerequisites results in daily fines of $1000 upwards. Undoubtedly a more meticulous process, but indefinitely a better alternative than being fined such amounts that would otherwise eat up your profitable cash flow!

Cannabis Legalization: Could this affect you as a Homeowner?

Cannabis Legalization: Could this affect you as a Homeowner?

With the deadline of the legalization  of cannabis approaching us this summer, it is inevitable to think of what this may mean for Homeowners. The legislation of Bill C-45 enables individuals to engage in cultivating cannabis plants at home – depending on the circumstances, sizes of the plants and what type of residence, this could result in significant impacts in a home. Because of this, the Canadian Real Estate Association is working diligently to implement policies that will benefit buyers and sellers of homes alike and to not be left at a disadvantage.

With potentially drastic changes pending, we will be sure to update Investors on this matter as the legislation nears.