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Foreign Buyer Bans and New Beginnings!
December 19, 2022 | Posted by: Michele Cummins
Warning! This show uses an automated transcription service for the episodes, so there will be spelling mistakes throughout (Including the spelling of Michele's name)
Curtis Pope:
All right. Saturday in December it's time for the Cummins Real Estate Group show with local Rockstar realtor Michelle Cummins and myself Curtis Pope. Good morning Michelle. Good
Michele Cummins - PREC:
morning Curtis December 17
Curtis Pope:
Always good to have you in studio because that means you're not indulging in the Christmas coffees while I'm chatting with you.
Michele Cummins - PREC:
Oh what do you don't know? Actually no I got my good protein or vitamin water going on here yeah my my niece gave me that which was very kind you know, you gotta get her vitamins in us and absolutely very important and that's the easiest way for me to do it
Curtis Pope:
and we actually didn't drink water enough regardless
Michele Cummins - PREC:
exactly see
Curtis Pope:
amongst other things flavorful odd because water is funny because it starts as water I think part of its water
Michele Cummins - PREC:
this morning but however I did have a glass of vodka after the Kane brown concert on Thursday that was so fun
Curtis Pope:
it was a good show was a lot of fun Yeah, I mean it was it was it took us a while to get there and traffic yesterday and everything else but we got there in time to see Kane at the stage I miss both opening acts
Michele Cummins - PREC:
I did not know opening acts go so long. I was just like is this the whole concert isn't Kane brown coming out?
Curtis Pope:
Depends on the on the ACT. Sometimes they give them a good 45 minutes slot. Sometimes they only get like 20 minutes. It depends who they are and things like that. Right. And yeah, so I like when to give them a lot of time because then you get to know these other artists.
Michele Cummins - PREC:
What was yours and Kelly's favorite song that Kane Brown did?
Curtis Pope:
Well I don't know for sure what my wife is because my wife's a big Kane brown fan. That's why we were there. But I love three. You know I love One Mississippi. I think that's probably probably my favorite song he has but he was it was a good night. I mean, he played a lot of great songs and and I said it was it had more of a rock edge than I expected. Totally. Yeah. Yeah, it was a country show. But it was a it was pretty rockin.
Michele Cummins - PREC:
Yeah, well, he's kind of he's got the rockin him, right. He does. Fans, but his wife wasn't there with him.
Curtis Pope:
I know. It was a bit of a disappoint because it was all over social media, how she'd been touring across Canada with him and she'd been coming up on stage and singing their duet with them. I'm not sure if you saw a guy got tossed out of the venue. I didn't see that during that song. No way. I'm not sure what he did. It was like two or three cops and two or three security guards dragging him out. He was putting up a bit of resistance to and they were having to stretch. They were struggling to get him out of the place.
Michele Cummins - PREC:
I know the two ladies were sitting right next to me. We're having a Hootenanny of a time they they were dancing all over the place pushing everybody around them screaming yelling I was like, I thought I was I had my hyper one.
Curtis Pope:
The poor girl behind us the young lady behind us. You know what just shows you I mean she maybe she was 25 she she's she slipped trip almost fell into us and dumped her drink on the back of our into our chairs and we weren't sitting in them oh my god like the three of us and she kind of she was this poor girl she wanted to crawl under her seat. She was so embarrassed because it wasn't like she was having too good of a time and she was falling over drunk or anything but she tripped just jump in and and she was so embarrassed and and she's apologized for like it's fine. It's all good. Don't worry. Well, it's easy to do, especially
Michele Cummins - PREC:
if she's wearing like heeled boots.
Curtis Pope:
Was the prom I think she had shoes on it she probably didn't wear very often and she was quite embarrassed that's probably
Michele Cummins - PREC:
okay do you regret my favorite time of the night though? My favorite was when Kane brown brought the two the couple older couple from was very cute. will hear me yes
Curtis Pope:
that's right because Kane was very subtle going I don't believe this is real place you can see that look on his face. You say it heads on the mic. And then
Michele Cummins - PREC:
he's saying and they danced on stage they held each other and dance that was so romantic. I had tears in my
Curtis Pope:
eyes it was very sweet and was shows you the you know, savvy entertainer to see this couple neons go into something here
Michele Cummins - PREC:
and then wasn't a cool that at the end he went around the stage and he signed hats and T shirts and somebody took off their boot and had him sign it and he took the time to do all that at the end. I thought that was so neat. He went around the station to that
Curtis Pope:
that's always a bold move to me if you had a guy there your booth because what if he hands it back to the wrong person? And you know, you know, did he know what does he walk home on one shoe like that's what I'd be thing
Michele Cummins - PREC:
that's true. Somebody threw a pink hat on the stage cowgirl hat. Yeah. And then he didn't know who was wrong do Oh goodness. Um, the other exciting thing that happened the week before actually for me and why we did a replay last Saturday is because I was in Vegas for the first time in a long time and I was at the team's vent REMAX event and I got to go and it was really fun. There's not a lot of good shows happening that week. Just nothing was really on I wanted to go to American Idol or of course, Adele I would always see Adele again and she's pleased out there, but not till weekends. But I went and did the Excalibur show. You know the horses do that. Oh, it's so fun and you eat with your hands,
Curtis Pope:
your hands they have I swear the best tomato soup I've ever had in my life there.
Michele Cummins - PREC:
I don't know why I didn't get the tomatoes. Yeah, I
Curtis Pope:
had the tomato soup as part of my meal. And it was like the best tomato soup I've ever had. Oh, that's so interesting. And I'm like, How is this like at this dinner theater thing with knights and horse everything else? This is the best soup I
Michele Cummins - PREC:
think your own Cornish hen. And corn and in the yam. Oh my gosh, it was just amazing.
Curtis Pope:
I don't know if they still do it. Merlin. The magician comes out and he picks on a couple people in the crowd. My buddy made sure I had that seat. He got called ahead. And so we're I was getting picked on but the problem was because the way I was reacting being a smart aleck, he started picking on my buddy too. So we both got picked on for his part of the show. Amazed we didn't end up as part of the show.
Michele Cummins - PREC:
Did he know you were from Canada?
Curtis Pope:
Oh yeah, my buddy did the whole because my buddy like you as an American by birth. So he's like my Canadian buddies gonna be there. And we're gonna be legal. I know you do this because you've been on the show before. He got a hold them in advance and made sure that I was sitting in the seat that they would pick on and yeah,
Michele Cummins - PREC:
this was their Christmas show. So it was actually a different show. Yeah. So it's different than usual, because I've gone twice before. I just love it. But this time I was on my own. I was on the court, I saw everything I was in like the best seat of the house, but not that seat. That would have been fun seat. Okay, but we only have so much time. So we wanted to talk because it's the end of the year, you know, this time is for really spending quality time with family. It's about giving. It's about wrapping things up ending things. And it's about new beginnings. And it's just such a magical time of the year. I absolutely love this time of the year end. But the New Beginnings is what I wanted to focus on today. So because there's a lot of new real estate laws happening starting January 1. So one and we've talked about this before, and we're gonna go through all the ones starting January 1 Is the Bill C 19. The ban on foreign buyers, starting of course, January 2023 non Canadians will be banned from buying homes across Canada through the prohibition on the purchase of residential property by non Canadians Act. This Act prohibits non citizens and non permanent residents from purchasing residential property in Canada for two years. The act also restricts non Canadians from avoiding the ban by using corporations or other entities to purchase residential property, both the non Canadian purchaser of prohibited property and any person or entity that knowingly assists in the purchase can be fined up to $10,000. And the property may be forced to be sold. Now residential property it includes because this has been one of the topics about this whole law and what what is a residential property? Now how is it defined? So it includes detached houses or similar buildings of one to three dwelling units so you can get a have a triplex and you know that that's not included, as well as parts of buildings such as semi detached houses, strata units or other similar premises. How does the foreign buyer ban impact realtors? Well, along with lawyers and notaries, we all owe our clients obligation to inform them, and the legislation does not rely on realtors to enforce the prohibition. However, it does allow for penalties to be imposed on any party found guilty of knowingly assisting and non Canadian in violating the prohibition. So exemptions at this point, there is still lots that we do not know about the act because two deals have not been completely announced. Through regulation. There may be exemptions for certain groups of people, types of residential property and special circumstances. But these have not yet been established. Also, it is still unclear what it's meant by control, and what is considered purchase within the Act. The final regulations are intended to be published later this month, so should be soon. So though those are some of the things that are happening, that's the big one on the foreign buyers, which is is quite a huge change. Now, the potentially, there's potentially a ban coming on exclusive listings. So this one's unique and interesting because we have listings that go public on MLS and everywhere else and we've got exclusive listings that aren't meant to be advertised publicly. And so there is Korea, which is the Canadian Real Estate Association is wanting to implement the strict changes of not maybe allowing an exclusive listing. So we've had our say as realtors and as a community and so they're looking at it and we'll have further information probably next year but they are going considering some changes,
Curtis Pope:
I don't really see the negative to exclusive listing. I mean, if you don't want to sell your house and have a million people coming to an open house and stuff like that, and you have an agent that you trust and abused, and, you know, you maybe you're even on the fence of whether you want to sell well, why would you want to go? You know, 100% all in if you could do a exclusive listing?
Michele Cummins - PREC:
Yeah, exclusive listings, I find sellers who want to do an exclusive listing, it's usually because of privacy, maybe it's a business and they don't want it out in the general public. Or it's a very, you know, somebody who's established in a public figure, or, you know, a major entertainer, you know, they want to keep things private, and they don't really want it out there. So they're gonna hire a realtor who has a really great network to be able to sell it without making it all public. But then on the flip side, with exclusive listings for buyers, why do buyers want exclusive listings? Well, because they know it's not generally out there. And they know they can usually get a better deal. It's, it's not advertised everywhere. So a lot of times, developers, they'll only buy exclusive listings. So it
Curtis Pope:
seems like a lot of wins. And not a lot of negatives to me. But what do I know?
Michele Cummins - PREC:
Well, you know, a lot after the show, well, that's true and selling and buying yourself so many times. And then there's also the strata Property Act. So the banning of strata rental restriction bylaws, and the limiting of age restriction bylaws and strata housing to 55, plus and over and nothing underneath that. So right now we've got, we've got 25 plus 35, plus, we've got 45 plus 55. Plus, so we've got all these different age range limits, but they're going to that's going away. And you can only have 55 plus stars
Curtis Pope:
across the parking lot here. That's a 55 plus complex.
Michele Cummins - PREC:
Is that lady sunbathing? Oh, no, it's sunny.
Curtis Pope:
She's been done for a couple of months. I think she still was all summer she was out there getting her vitamin D. That's good. We all need it more and more. Absolutely. But ya know, that's a good example about complex areas if 55 Plus complex,
Michele Cummins - PREC:
exactly. And how is it going to change? You know, the ones that were already established? Obviously, there's grandfathering of those who live there and own there already, but it's gonna make some changes in the rental market? Absolutely. Do we have
Curtis Pope:
to go on break or should probably take a break? I know we have more to talk about. We'll do that when we come back. But if people want more information and have a look at your listings, and things like that, where can they go? Michelle commons.ca. We're back with more right after this. Bla and we are back with segment number two of the Cummins Real Estate Group show here on the Saturday morning. And while we've got more news, I guess to continue to talk about here since we got through a whole bunch in the first segment.
Michele Cummins - PREC:
Yes, there is more changes happening. But before we go, we were just talking on the break about the newest store in downtown one way mission called Cameron James midway.
Curtis Pope:
Yeah, it's in the junction actually, it's, it's the junction. That's my friend Ken McCoy. It's his stepson, and he started this business and it looks like I haven't had a chance to get in there yet. But it looks like it's got really good stuff. And
Michele Cummins - PREC:
yeah, and his history and what he knows and what I see in the social media posts of what's in there when I can't wait to go shopping there for every man I know. Yeah, I
Curtis Pope:
mean, Ken McCoy. He's a good buddy of mine. I've known him for years. He's a great musician and great singer. Don't tell him I said that. But he had some pictures up of trying on a suit jack and a couple things in the store. And I mean, they made Ken look good. And if they can make him look good, they can do some seriously good stuff for people. I hope Ken's listening.
Michele Cummins - PREC:
It's fantastic because there's so many unique clothes in there that I see. I can't wait to go how big is the store have you been in? I
Curtis Pope:
haven't been I need to go to because Well for one thing I need some new clothes and it looks like they got some. I mean my dress clothes are getting a little beat up and battered and I don't wear them very often either. So I will probably hit enter myself and go hang out and see what they got.
Michele Cummins - PREC:
I think it's a good place this year to buy something for the man in your life or you know the men in your life. Yeah, I can't wait to see it. I love new places and and with local like it isn't it's not a chain. It's not somebody who came in from out of town. Actually, it's a local, which is awesome to support.
Curtis Pope:
I'm pretty sure your husband is looking for a new guitar, though for Christmas,
Michele Cummins - PREC:
maybe a shirt with guitars on it?
Curtis Pope:
Well, if he doesn't get a guitar, he's gonna want to get a new car like for the collection. So the guitar, in theory should be cheaper.
Michele Cummins - PREC:
Yes, you're right. I see how your brains working here. Yes. Trying to pawn off a guitar, are you?
Curtis Pope:
I'm just saying. I mean, that seems like the cheaper of the possibilities.
Michele Cummins - PREC:
Well, when you can find a 12 string Rickenbacker let me know because that's what he wants. I'm sure
Curtis Pope:
I can find you on but those are not going to be cheap. Especially if he wants a vintage one, doesn't he? You know what? Probably 67 Yeah, whatever. Yeah, I'll keep doing keep an eye Dylan once one too. So I have the same thing going on in my house. My kid wants one. So no one's good at research. Yeah. Your kid wants one of my kid wants one. There you go.
Michele Cummins - PREC:
Okay, so the next rule that we're going to talk about is did you know about Canada's new anti flipping tax?
Curtis Pope:
No, I didn't really know anything about that. I read like a headline somewhere about it. But I reveries didn't read the article. Yeah. Well,
Michele Cummins - PREC:
you know, usually, it's the builders who can't flip within the first year of building because, you know, builder home owner, they think, oh, what's the business, but now they're changing it. So the housing market in Canada has skyrocketed, as we all know, for the last few years, and in an attempt to cool it off. That's what the government part of the government's action plans. So the federal government is implementing, it's called an anti flipping measure. This means that Canadians selling a home or rental residential property that they've held for less than 12 months, will be considered flipping and consequently, the profits from the sale will be considered business income. So this forms a significant change where taxpayers used to be able to sell homes quickly claiming capital gains and or the principal residence exemption, new anti flipping rules, the anti flipping measure will apply to residential property sold on or after January. So that's one of those new rules. I just had somebody inquire about one of my properties that needs some TLC, and it would be a great flipping property. But I warned them, just so you know, you're not going to be able to flip it for 12 months when you purchase it. So the new measure was announced in the federal budget released in April. So in the document, the federal government attributes the high housing prices, partly to property flipping, buying the house and selling it within a short period of time, and yes, that did absolutely happen. Many people were buying homes and then of course, they were going up 100, grand, 200 grand and a month or two. And they were like, well, let's just sell it. So yes, it was happening. But it's not the norm. That was the first time we've ever been through that type of market, but they are making this new rule. So yes, so generally, when an individual sells a property, the profits from the sale are considered capital gains, and thus, only 50% of the gains from the sale are taxed. Additionally, there's a principal residence exemption for individuals selling their primary residence. However, profits from flipping properties are fully taxed and not eligible for either capital gains inclusion or the principal residence exemption. So something to keep in mind, it doesn't matter if it's your principal residence or not, currently, to the categories to proceed to the sales of residential property is business income, is the Canadian Revenue Agency, the CRA needs to show that the taxpayer intends to flip the property in the pursuit of profit. However, the proposed anti flipping measure eliminates the CRA s burden to prove this intention. So these are the exemptions to the new anti flipping rules. There are exemptions. And so we need to know about them. And they're so if you have a home within 12 months due to certain life circumstances, of course, that is not it's out of your control. The government says that that would be an exemption and they also were the property being sold as because of that certain change in circumstances this sale would not automatically result in business income. A non exhaustive list is as follows. And here it is changes in life circumstances. Of course, as birth of children, of course, you have children, you need a new property for that new job or you're moving for that a divorce, of course a death. Obviously, disability, or other circumstances not yet known. So the new legislation may or may not contain a detailed list where any of the above apply, it would be a question of fact as to whether the property sale resulted in business income, a capital gain or a capital gain that was eligible for the principal residence exemption. This question of fact will be reviewed by an auditor in a property sale audit. These have been going on for years and because of the exemptions provided, they will likely continue for many more years to come. So Uh, yeah, so that's the change is not just builders now that can't flip within a year. It's it's all of us. Unless, of course,
Curtis Pope:
if I kick a kid out, downsize, and then live there for a year flip it, bring the kid back, buy a bigger house, I can just keep going back and forth.
Michele Cummins - PREC:
You know what there's, there's always ways around things.
Curtis Pope:
I'm just saying, I mean, I don't know which one of the kids I'm kicking out at any given time. Probably Cody. Well, you, you so you can get Castillo she's only 16. But the other two are fair game.
Michele Cummins - PREC:
Well, I don't know, some people have kicked their kids out. But she's, she's a good kid. Shoes. Okay, so the next rule that's actually changing is the rescission period for buyers. Now, we've talked about this before, but wanted to remind that buyers can rescind their commitment to purchase within three days in writing to the seller, not the realtor, mind you. This is not between the realtors and the parties. It is between the buyer and seller. So in the contracts, and there's all new contracts happening on the first of January to be used for certain clauses and changes to be implemented regarding all these changes in rules. So, yes, they have to let the seller know in writing within the three days after they've committed to purchase and that though, will come with a penalty of point two 5%. So that's 0.25% of the purchase price. And they will owe that to the seller, should they rescind their commitment. That is of course if there's no subjects. So there's your regular set, the whole purpose of this rescission period was to help buyers be able to make a con a very wise decision in their purchase so that they have due diligence, they have time to do that, and to know what they're purchasing and not just jump into something with no subjects because there's multiple offers. So there is the rare multiple offers still happening. Yes. And so that's what that's all about. And when we're moving forward with that talking about sometimes there's still multiple offers happening right now. We're gonna talk about the Canadian housing market conditions expected in 2023. REMAX nationalists come out with this big report they do. They do quarterly reports, they do the annual report, this is the annual report. And they they have fully come out with some things that, you know, expectations, the shift in 2023. So 60% of Canadian housing market and is anticipated to balance in 2023. That's all Canada. According to a ledger survey commissioned by REMAX as part of the report. Canadians view home ownership as the best long term investment they can make. And that 73% of Canadians, yet the majority, which 67% are feeling less optimistic in the short term was 67% less inclined to buy in the first half. So 62% is less inclined to sell in that timeframe. Now, this is their report. Now this is Canada and we are in the Fraser Valley, the beautiful Fraser Valley in our area there. I and many others in the business believe that there's going to be an in slot of buyers like more buyers in the market, especially first time homebuyers and move up buyers who actually now they can afford that the prices have come down. They're really the biggest thing. Yes, prices have come down, but they're not competing with other buyers. Right? They don't. It was all the frustration and the sadness and then emotional and the tears that happened when they kept on missing out on 30 homes they tried for and not being able to have subjects and all that. So that has changed and 42
Curtis Pope:
offers to go through. Can you imagine? Ever the one house we put an offer in I think you said it was 23 offers or sells through that it was really busy during that time using this. We weren't that far off on the price everything either. But it blew me away that they'd had that many offers.
Michele Cummins - PREC:
Yeah, I don't know what the highest in our area of how many offers on the same house. That would be a great survey to do how many offers on the same property?
Curtis Pope:
I had seven or eight on ours. Yeah.
Michele Cummins - PREC:
But yeah, so. So finally, it's a really good balanced market. It's good for buyers, they're not competing, like they used to the prices are going down. It's good for sellers, because now they're buyers as well. And it's more balanced. It's it's, there's less risk in today's type of market as well for everyone. So, so it's good to see the majority of markets moving toward more balanced conditions. And that's throughout Canada, which is typically defined by 45 to 90 days on the market. So who knows, like yesterday, I could have sold the house not just within an hour, that kind of thing. But now it's 45 to 90 days, which seems like a long time for people who were in the market a few years for the last few years. But it's it's normal. So this is a much needed adjustment from the it was on sustainable before so the price increases that we have had in the early part of 2022. Many Canadians have understandably expressed hesitancy about engaging in real estate market. In later half of of of 2023, they're actually thinking of going into it like beginning and mid 2023. So I see the market is in our area actually doing pretty good. So so that's the part of the Canadian stats. Now, we're confident that as the economic conditions improve, and the market continues to even out go in the quarter, the third quarter than the fourth quarter of 2003, a more regular pace of activity will resume. And I'm going to specifically mentioned the Greater Vancouver area in this report there so the Greater Vancouver area is very balanced. And as I said, the move up and the move and the the first time homebuyers are going to I believe gravitate to finally making that purchase decision. And, and this is okay single detached homes remain the dominant housing type in the area with the upsizing trend expected to become increasingly popular among families in 2023. desirable neighborhoods in the city are currently based on location with access to rapid transit played a large part in purchasing decisions. And a continued drop in condo pricing is expected actually in 2023. In the more city areas of the Vancouver and the Fraser Valley, it's going to pretty much balance out while the luxury market is anticipated to have a slow start to the year before balancing out in the lead or half of 2023 the average residential sale price in the Greater Vancouver area is anticipated to decrease by 5% Next year, and decrease 20% in sales. So price decrease of 5% anticipated and sales by less than 20%. So that is just a snippet of of the report from Remax for 2023 real estate market in Canada and specifically the Greater Vancouver area. Now new listings I know we gotta go and this has been so fantastic again, I love meeting with you weekly Curtis specially in the studio was so fun. And I so I'm just gonna leave with one listing of mine mentioning because it's going to auction I've got a couple of commercial properties going to auction in January. So starting January 9, I have one all right, and mid January, another so keep an eye out because it's really exciting. And they're really great properties and it's going to be a fun auction process. So if you are interested in having your commercial property or residential property, go to auction and you're curious about it. Give me a call anytime. Just google my name and you'll find my cell phone
Curtis Pope:
Michelle one l no G we haven't had to say that for a while actually
Michele Cummins - PREC:
Michelle with one L and Cummins like the diesel engine nice and strong.
Curtis Pope:
That's right. No, it's a little subtle reminder there.
Michele Cummins - PREC:
And the quote of the week troubles in like well keep this in mind okay, troubles in life. Some we all have troubles in life. But a smooth sea never made a skilled sailor.
Curtis Pope:
True. Most of my troubles happened between eight and 830 on Saturday mornings.
Michele Cummins - PREC:
Very funny.
Curtis Pope:
If people want more information about what you do as a realtor, and of course all your listings and auctions and all that fun stuff. Where can they go,
Michele Cummins - PREC:
Michelle? One l Cummins No g.ca
Curtis Pope:
And join us again next week and we will talk real estate in order to unlock your real estate potential on the show real estate is maximized. Thanks for listening
If you missed last week's episode where we replay last years Christmas episode, please go take a listen! It's well worth it!