Frequently Asked Questions.

Our Real Estate FAQ helps to answer questions about Kelowna Real Estate trends and topics of interest. Here are a few of the more current questions we have been answering about today’s market and what to expect if you are investing, buying, or selling a home in Kelowna.

Many first time buyers feel they have to have the cash in the bank for their down payment and associated fees. This is not entirely true. Many real estate fees associated with the sale of a property, the conveyance, insurance, taxes and transfer of title are added to the mortgage costs and paid out by the lawyer when the property transfer is complete.

When preparing your home for sale, there are some easy things you can do that could help increase the value of your home for very little cost including:  decluttering, repainting and touch ups, landscaping and general cleaning.  Consult a real estate agent prior to listing for their advice on what will help increase value.

Real estate fees when selling a home can vary from agent to agent.  There is no set standard for what each agent or brokerage will charge.  The most common commission structure is 7% o the first $100 000 and 3% on the balance of the purchase price, plus GST.  While there are different fee structures, services will vary as well so ask about services provided prior to agreeing to a fee structure.  

The average day on market is the time it take from when a home is first listed to when it is a firm sale.  The average day on market in Kelowna for 2017 is 48 days on a last year of 53.  Average days on market will typically be shorter in the spring/summer months and long in the fall/winter.

The first thing to do when you decided to buy your first home is to talk to a mortgage broker to get you pre-qualified for a mortgage.  A mortgage broker will help you determine what you can comfortably spend on your home while taking into consideration the monthly costs involved in owning your own property.  This service is of no cost to you as a buyer and well worth it.  See our blog ….. On the benefits of getting pre-qualified.

The choice of a real estate professional is entirely up to you but you will want to choose wisely.  You will want to choose someone who listens to your needs and will work hard for your best interest.  Someone who you get along with as the home buying process is a partnership between you and your Realtor.  Find a real estate agent who knows the market you are buying in and can give you advice on the home buying process.

There are rebates available for first time homebuyers in British Columbia.  To qualify, you must be a resident of BC for more than one year and have not previously owned a property.  As a first time homebuyer, you are exempt from the property land transfer tax for a purchase up to $500 000.  There is a partial exemption from $500 000 to $525 000.

The minimum down payment when buying an investment property is 20% if the buyer is a resident of Canada.  If they buyer is a foreign investor, the minimum is 50% and the money must be in the country for a minimum of 30 days prior to completion.

When buying an investment property in Kelowna, you should first consider what type of property.  Best area to invest for land would be larger lots close to amenities that could be rezoned for higher density, this would be as a holding property.  To maximize on rental income, consider the following:  when renting to students or young professionals, consider an apartment style strata close to amenities, transit and perhaps college.  For summer vacation rentals, buy close to the lake in a building with amenities and for family homes, choose a location close to school and parks.

If you are buying a recreational property for your own personal use, you can put down as little as 5% as a down payment.  If you are buying a recreational property for the purpose renting it out, you will need a minimum 20% down payment.  

C9 Zoning is a commercial zoning used for some strata condominium buildings in Kelowna. This zoning classifies the building as a hotel which allows for nightly/weekly or monthly rentals.  The buildings zoned C9 will usually have amenities such as pool, gym, courtyard and suites making them appealing to vacationers and fetch a premium in the summer months.  

A recreational property is a property that is not your primary residence that caters to a certain lifestyle whether it be a cottage on the water, a cabin in the woods, a cozy ski chalet or a downtown condominium with amenities.  Some recreational properties can be difficult to finance to check with a mortgage broker prior to making an offer.  

Every strata is different.  You will want to refer to the by-laws of your building to see what the rules are for making changes to your strata unit.  Most changes need to be approved by strata council if they will in any way affect the surrounding strata units: ie.  flooring, structural, countertops.  Paint and fixtures typically do not need approval.

A contingency reserve fund is money set aside by the strata corporation that  covers operating expenses as well a safety fund any repairs or emergency situations.  This fund will cover maintenance on the building and common areas, any upcoming repairs or possible unforeseen expenses.  It is important that a strata corporation has a healthy fund to cover upcoming issues as outlined in the depreciation report.

Every strata is different so it is important that you review the strata documents so you are aware of what the fees cover.  Most strata fees will cover; landscaping, snow removal, garbage disposal, insurance and contribution to the contingency reserve fund.  Some will also include; utilities and recreation so it is important to know, prior to purchasing a strata unit, what your monthly fees include.

Strata fees are the same as condo fees, which are applicable to condominium or townhouse properties.   These fees are payed by the owner as monthly payment set out by the strata corporation and are relative to the size of each unit in the complex.  These monthly fees will differ from complex to complex in what they will cover so reivew of strata documents are important to determine what is included in the fees.  

All docks in the Okanagan need specific permission from the ministry to be considered legal.  If a dock is already built, it can be grandfathered in, as long as it meets certain specifications.  The rules of building a new dock will depend on which area of the lake and must meet current guidelines and rules set out by the ministry and could include: building materials, distance from shore, high water mark and design.

A riparian zone is the area between high water mark and where the waterfront home is built.  This area is protected and can not be built on or disturbed.  Any structures currently in the riparian area would have special permission and are grandfathered in, however, can not be modified in any way.

Taxes on a waterfront property will vary depending on the value of the home and can run anywhere from $18,000 to $50,000 a year. These taxes are considerably higher due to the luxury of living along the water.  Homes on the waterfront are considerably higher than homes inland due to the exclusivity of living on the water.

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