When buying a home, most people focus on the property’s physical condition and location. But sometimes, what has happened in or near the home can have a lasting impact on its marketability—regardless of how perfect the house seems otherwise. These properties are known as "stigmatized" properties, and their value can be significantly affected by non-physical events tied to their history.

What Makes a Property Stigmatized?

A stigmatized property is one that has been impacted by an event that affects how buyers perceive it, even though the property itself is in good condition. These events don’t usually affect the property’s structure or use, but they can make it less desirable.

Examples include:

• Criminal activity: A home next to a reputed gang member’s house.

• Violence or death: A murder, suicide, or other violent crime associated with the property.

• Unusual occurrences: The property being rumored to be haunted or previously used for illegal activities.

Although these events don’t change the property’s physical condition, they can deeply affect how buyers feel about living there.

Why Do Stigmatized Properties Lose Value?

The stigma surrounding certain events or circumstances can have a powerful psychological effect on potential buyers. Even if a property is in excellent shape, buyers might not want to live in a home with a violent or unsettling history, particularly if the event was widely publicized. For some, a tragic past might be a dealbreaker, while others might be more open-minded—or even intrigued by the property’s story.

The perception of stigma varies from buyer to buyer. For example, a house with a history of ghost sightings might scare some away, while others may find the supernatural element a unique charm that adds character to the property.

The Subjectivity of Stigmatization

What one buyer finds off-putting, another might see as a selling point. For example, some buyers may be perfectly fine with the fact that a murder occurred in the house, while others might consider it a dealbreaker. This subjectivity makes it challenging to determine whether a property is stigmatized and how it will affect the market value.

This unpredictability also makes it hard to decide whether sellers should disclose these events. After all, revealing the property’s history could lower its value, but keeping it a secret may lead to legal trouble later on.

Legal Considerations

In places like British Columbia (BC) and Ontario, there’s no specific law requiring sellers to disclose stigmatizing events. However, in some areas like the U.S. and Quebec, there are disclosure requirements.

While these laws vary, they highlight the importance of understanding how psychological factors can impact a property’s sale. Even if there’s no legal requirement, sellers should consider how a property’s past might influence potential buyers' decisions.

Conclusion

Stigmatized properties are a reminder that, in real estate, perception can be just as important as physical condition. While the house may be in top shape, its history—whether tied to crime, death, or rumors—can make a significant impact on its value and desirability. Whether you’re buying or selling, understanding the emotional and psychological factors at play is key. After all, what’s considered a "haunted" house to one person might be the dream home for someone else.

Details courtesy of - https://bcrealestatelawyers.com/knowledge-centre/legal-issues-faqs/stigmatized-properties/

The B.C. Real Estate Association (BCREA) reports that the province’s housing market ended 2024 on a strong note, setting a positive outlook for 2025. The latest data shows a significant 24.7% increase in residential unit sales in December compared to the same month in 2023, with 4,484 homes sold. At the same time, the average price of a home in B.C. rose to nearly $1.1 million, marking a 5.6% year-over-year increase. This uptick in both sales and prices indicates a market that’s gaining momentum as it moves into the new year.

Brendon Ogmundson, BCREA's chief economist, highlights that active listings have increased by almost 17%, which is the highest start-of-year inventory level in B.C. since 2019. This increase in listings means that buyers now have more choices available to them, helping to balance supply and demand. "There are enough listings in the market right now to absorb that extra demand without prices rising too much," Ogmundson told CBC News. This stable inventory, combined with a steady demand, sets the stage for a more balanced housing market in 2025. The Canadian Real Estate Association (CREA) also predicts a solid year ahead, with home sales in B.C. expected to see an 8.6% increase, largely driven by a recovery in the province’s housing inventory.

Despite the positive outlook, affordability remains a challenge for many in B.C. Even as interest rates have begun to decrease, they’re still coming off a high base, which means home prices have not fully adjusted to the earlier rate hikes. University of British Columbia business professor Thomas Davidoff points out that while falling interest rates are a welcome relief for buyers, the overall affordability crisis persists. As the market stabilizes and demand continues to grow, B.C.'s housing affordability will continue to be a key issue to watch in the year ahead.

Though the housing market is entering a period of relative stability, there are still external factors that could disrupt this equilibrium. Ogmundson has expressed concerns about potential tariffs or other trade-related issues from south of the border, which could impact B.C.'s housing market by raising construction costs and affecting supply chains. For now, however, the market remains in a relatively balanced state, providing some relief for buyers, though challenges remain in the form of high prices and the ongoing affordability crisis.

Details courtesy of - https://www.cbc.ca/news/canada/british-columbia/b-c-housing-market-forecast-2025-1.7435419

When you purchase or gain an interest in property that is registered at the Land Title Office, you or your legal professional must file a property transfer tax return and pay the applicable property transfer tax, unless you qualify for an exemption. The property transfer tax is based on the fair market value of the property (land and improvements) at the time it was registered. The tax is calculated using a tiered rate: 1% on the first $200,000, 2% on the portion between $200,000 and $2,000,000, and 3% on amounts above $2,000,000. However, if you are a foreign national, foreign corporation, or taxable trustee, an additional property transfer tax applies on the residential portion of the property if it is located in a specified area of B.C. The first-time home buyers' program may reduce or eliminate the amount of property transfer tax you owe when purchasing your first home. To qualify for an exemption, you must be a Canadian citizen or permanent resident and meet one of the following criteria: have lived in B.C. for at least a year immediately before the registration date, or have filed at least two income tax returns as a B.C. resident in the last six taxation years before the registration. Additionally, you must have never owned a registered interest in a property that was your principal residence anywhere in the world and have never received a first-time home buyers' exemption or refund. The property itself must be used exclusively as your principal residence, have a fair market value of $835,000 or less (effective April 1, 2024), be 0.5 hectares (1.24 acres) or smaller, and contain only residential improvements. If one or more purchasers do not qualify, only the percentage of interest owned by the qualifying first-time home buyer(s) is eligible for the exemption. For example, if you acquired 60% interest in the property and another person acquired 40% interest, but only you meet the qualifications, only your 60% would be exempt. It’s also important to note that property transfer tax is distinct from annual property taxes, which are paid to your municipal or rural tax office to fund local services. The fair market value refers to the price a willing buyer would pay a willing seller for the property in the open market on the registration date. The government provides an online calculator to help estimate your property transfer tax, which should be factored into your closing costs.

Details provided by - https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/exemptions/first-time-home-buyers + https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax

So you got your BC Assessment in the mail last week and you don't like the number you see. Do you have any options as the homeowner, what can you do?  Well before filing a complaint or appeal regarding your property assessment, it's recommended that you first review your assessment and compare it with the sales data of similar properties using the Assessment Search tool. (Or contact CJ or Garry and we can help pull sales data for you.) This will help ensure that your assessment is accurate. If you still have concerns, You are encouraged to contact BC Assessment for clarification before formally submitting a Notice of Complaint (Appeal). The deadline for filing a complaint or appeal for the 2025 assessment is January 31, 2025.

Many concerns can often be addressed through direct discussions with the staff, outside of the formal complaint process. If, after contacting BC Assessment, you remain unsatisfied, you have the option to proceed with the formal appeal process for an independent review of your assessment. You can reach them by phone at 1-866-VALUEBC or use the Contact Us form for electronic assistance. If you prefer in-person service, you can schedule an appointment by contacting the same number. The first level of appeal is to the Property Assessment Review Panel (PARP), with a filing deadline of January 31, 2025. If you wish to pursue the matter further, the second level of appeal is to the Property Assessment Appeal Board (PAAB), which has a filing deadline of April 30. Please note that you must file with the PARP before escalating your appeal to the PAAB. For more information on the process and preparing for a hearing, please consult the Appeal Guide or visit the Ministry of Finance website.

Data courtesy of BC Assessments  - https://info.bcassessment.ca/Services-products/appeals

Showing Signs Of Recovery

The Canadian housing market is showing signs of recovery, with pent-up demand expected to drive more home sales in the coming months. However, TD economist Rishi Sondhi warns that this surge in activity won’t last indefinitely, projecting that the rush will likely subside by the first half of next year. While the initial wave of demand should push housing prices higher, Sondhi notes that large supply backlogs, particularly in Ontario and British Columbia, will continue to weigh on the market and take time to resolve. As demand outpaces supply, home prices are likely to rise in the short term.

New Mortgage Rule Changes And Interest Rates

Additionally, there are factors that could further support the housing market in the coming months. Falling interest rates and recent federal mortgage rule changes, which took effect on December 15, are expected to give a boost to both home sales and prices. Among the key changes are an increase in the maximum mortgage amortization period for first-time buyers from 25 years to 30 years, as well as a rise in the insured mortgage cap from $1 million to $1.5 million. These measures, coupled with the potential for continued economic growth, should help sustain the housing market’s momentum. According to TD’s forecast, home sales across Canada are expected to rise by 16 percent in 2025, while the average home price could increase by 8 percent.

For homebuyers, recent policy changes have improved affordability, particularly in light of the national banking regulator’s decision to eliminate the stress test for uninsured mortgages. As of September, the Office of the Superintendent of Financial Institutions no longer requires lenders to apply the minimum qualifying rate when borrowers switch their mortgages to a different institution, provided their loan amount and amortization schedule remain unchanged. Ratesdotca’s mortgage expert Victor Tran believes these changes will contribute to a hot spring market in 2025, as more buyers take advantage of the improved conditions.

In Vancouver, housing affordability is showing slight improvement, although challenges remain. The Royal Bank of Canada’s December 2024 report notes that rising household incomes have helped ease some of the affordability strain, and home prices in the region are stabilizing. However, despite these gains, affordability in Vancouver remains an issue, with 96.7 percent of the median household income required to cover homeownership costs in the third quarter of 2024. This is in stark contrast to other Canadian cities, such as Calgary (42.2 percent), Edmonton (33.6 percent), Ottawa (47.3 percent), and Montreal (49.4 percent). While the Bank of Canada is expected to cut interest rates further in 2025, which could lower homeownership costs, RBC’s Robert Hogue cautions that any significant price increases in Vancouver would be a setback, making it even harder for average households to afford a home.

Overall, while the Canadian housing market is poised for a stronger 2025, the recovery will be uneven, with regional disparities in affordability and supply challenges continuing to shape the landscape. The interplay of interest rates, federal policy changes, and local market dynamics will play a key role in determining how the market evolves in the months ahead.

Want to know how this impacts you as a buyer or seller? Give me a call or email today, and I’ll help you understand how this affects your personal real estate situation.

Call/Text Garry

Email Garry

Details provided by The Canadian Press & Business Intelligence for BC 

https://www.bnnbloomberg.ca/business/real-estate/2024/12/30/housing-market-poised-for-2025-comeback-as-lower-rates-unleash-pent-up-demand/

https://www.biv.com/news/real-estate/homeownership-costs-ease-a-little-in-vancouver-but-affordability-still-elusive-says-rbc-10025840#:~:text=RBC%20anticipates%20a%20two%2Dper,Hogue%20said%20in%20the%20report.

 The BC home flipping tax, effective January 1, 2025, targets profits made from selling residential properties within 730 days of ownership, including presale contracts. Imposed under the Residential Property (Short-Term Holding) Profit Tax Act, this tax applies whether the seller is a B.C. resident or lives elsewhere. The tax rate is 20% of the net taxable income from properties sold within the first 365 days of ownership, with the rate decreasing over the next 365 days. After 730 days of ownership, the tax no longer applies. For example, if you purchased a property on May 1, 2023, and sold it on January 31, 2025, the profit would be subject to the tax because you owned the property for 642 days. However, if you sold it on May 31, 2025, after 762 days of ownership, no tax would apply.

The tax applies to any property sold or transferred on or after January 1, 2025, if it was owned for less than 730 days, but it is distinct from federal property flipping rules and is not tied to B.C. or federal income tax. There are some exceptions, such as transfers between related persons (e.g., gifts), where the property may be exempt. For instance, if Michael buys a property from his father, who originally purchased it in 2020, Michael is deemed to have owned the property since 2020, thus exempting him from the tax, even if he sells it within the 730-day window. Similarly, the day you buy a property is generally the closing date, and if you purchase from a related person, the "purchase date" is based on when they first acquired it. The tax’s purpose is to deter short-term property flipping for profit, part of B.C.'s Homes for People Plan.

So what does this mean for you moving forward in 2025? Well you have no worries if you have held your property for over 2 years. If you have owned for less than 1 year most likely you will be subject to the tax, if you  have owned for a period between 12-24 months you will most likely be subject to a portion of the taxes. The government has initiated this program with hopes of fewer people (investors) buying places and flipping them for a profit, in a short period of time. In theory this should make things easier for new buyers to enter the real estate market in British Columbia however it could penalize people who need to sell for one reason or another after only owning the property for under 730 days. 

Details provided by BC government webpage- https://www2.gov.bc.ca/gov/content/taxes/income-taxes/bc-home-flipping-tax

New mortgage rules aim to provide relief for more homebuyers

Homeownership has long been a major milestone for Canadians – the “Canadian dream,” if you will. But in recent years, the dream has felt increasingly out of reach. With rising home prices and the high cost of mortgage payments, first-time home buyers in particular have been priced out of homeownership.

But there is good news for both those looking to enter the housing market, as well as homeowners ready to renew their mortgage.

New mortgage rules announced by the Canadian government are designed to help reduce the barriers that exist for first-time homebuyers. Here’s a rundown of the changes and the benefits they offer.

Reduced down payment for homes worth up to $1.5 million

Currently, someone buying a home that costs less than $1 million is allowed to make a down payment of less than 20 percent, provided they take out mortgage insurance. This insurance, which protects lenders from default, allows buyers to finance up to 95% of the home’s purchase price.

However, starting December 15, 2024, new mortgage rules will expand eligibility for mortgage insurance to homes valued at up to $1.5 million. Under these rules, buyers will need to put down a minimum of 5% on the first $500,000 and 10% on the portion between $500,000 and $1.5 million. This means that on a $1 million home, the minimum down payment will drop to $75,000—significantly lower than the current requirement of $200,000.

This change acknowledges the realities of today’s housing market, particularly in high-cost areas such as Vancouver, Toronto and much of Southern Ontario, where homes often exceed $1 million.

More Canadians can quality for 30-year mortgages

Back in July 2024, the government announced that lenders could offer 30-year amortizations on insured mortgages for first-time homebuyers purchasing new builds. As of December 15, 2024, this measure will be extended to all first-time homebuyers, and all buyers of new builds, including condos. By stretching mortgage payments over a longer period of time (30 years instead of the current maximum of 25), homeowners can benefit from lower regular mortgage payments.

Stress test no longer needed when switching a mortgage at renewal

As of November 21, 2024, any mortgage holder looking to switch their mortgage to another lender will no longer need to undergo a “stress test.”

The stress test requires lenders to ensure borrowers can still make their mortgage payments if their interest rate goes up or they experience an increase in household expenses. The policy change means that mortgage holders can switch lenders at renewal without being subject to another stress test, provided they are renewing under the same amortization schedule and loan amount.

The change applies to both insured mortgage and uninsured mortgages and enables more Canadians to switch to a provider that better meets their mortgage needs.

A complement to current programs

These measures are in addition to existing programs and tax benefits that can help pave the way to homeownership for first-time homebuyers.

• First Home Savings Account (FHSA). This registered account allows Canadians to contribute up to $8,000 per year over 15 years, up to a lifetime contribution limit of $40,000 towards their first down payment.  Contributions, including any investment income, are tax-deductible and withdrawals to purchase a first home are not taxable, helping first-time buyers maximize their buying power.

• The Home Buyers’ Plan (HBP). Under the HBP, first-time homebuyers can make tax-free withdrawals from their Registered Retirement Savings Plan (RRSP) to help finance the down payment on a home. The withdrawal is not taxable as long as it is repaid within a 15-year period. The withdrawal limit was recently increased from $35,000 to $60,000. For couples who are buying a home together, that limit reaches $120,000.

• Land Transfer Tax Rebates. Land transfer tax rebates are available to first-time homebuyers in the provinces of Ontario, British Columbia and Prince Edward Island. There is also a land transfer tax rebate available for first-time homebuyers in the city of Toronto. 

• First-Time Home Buyers’ Tax Credit (HBTC). First-time homebuyers can claim up to $10,000 for the purchase of a qualifying home. At a 15% tax rate, the $10,000 claim equals a one-time $1,500 tax reduction.

• GST/HST new housing rebate. If you buy a new-build home preconstruction or make substantial renovations to an existing home, you could qualify for a rebate on the GST or HST. The amount of the GST/HST new housing rebate depends on the purchase price of the home.

*Information courtesy RBC

Date: Wednesday, November 29, 2023

Time: 6:30am – 9:30am

Location: Newlands Golf & Country Club, 21025 48th Avenue, Langley BC

We invite you to join us on Wednesday, November 29th for Langley’s third annual Christmas Wish Breakfast. Everyone who turns up between 6:30am and 9:30am to donate a new unwrapped toy, gift card, or make a cash donation will be treated to a complimentary breakfast prepared by the Newlands culinary staff. The crowd will be entertained by local singers and musicians and a visit from Santa and Mrs. Claus, and volunteers from the Langley City Fire Department and RCMP will be on hand to receive the toys on behalf of the Christmas Bureau.