Commentary

This section provides some local information, such as neighbourhood zoning, provincial acts and regulations that impact the value of real estate, and tax information for owners, sellers, and buyers, as well as

Good news for first time buyers of homes! As of February 20, 2008, first time buyers can buy a home up to $425,000 (previous limit was $375,00) without paying the Property Transfer Tax (PTT). There is also a proportional exemption up to $450,000. Other rules governing size of mortgage etc have also changed. Please check all details with your lawyer and/or the government website.

If a buyer does not apply for the exemption at the time of original registration of a home at Land Titles but meets all the criteria, the buyer can still apply for a refund within the first 18 months of the original registration.

The PTT is 1% on the first $200,000 of the purchase price & 2% of the balance. It is paid at the time of title transfer, normally, through a lawyer.

The Home Owner Grant
The Home Owner Grant is a benefit available annually, only to BC homeowners and only on their principal residence. It is intended to help reduce the annual tax load, which is based on the assessed value of each property.

As a result of strong market conditions, property values have increased considerably in the last few years resulting in higher and higher annual property taxes. For five consecutive years, the BC government has improved the Home Owner Grant. Now, the full grant is available up to an assessed value of $1,050,000 and eliminated on homes assessed at $1,164,000 or more.

The new threshold means “that 95 per cent of BC home owners will still have the chance to get the full Home Owner Grant,” explained then (2007) Finance Minister Carole Taylor. "I think it is shocking to all of us that we are talking about $1 million homes being the 95% level".

The current threshold is $1,050,000. The phase-out level is $1,164,000, up from $1,064,000 (no grant available). In between $1,064,000 & $1,164,000 the grant is reduced by $5 for each $1,000 of assessed value.

The grant amount as of 2006 is $570 (was $ 470) per annum for most eligible homeowners. It also gives eligible seniors age 65 and older, eligible persons with disabilities and eligible war veterans an additional grant of $275. Thus, a homeowner may be eligible, with the additional $275 annual grant, for a total of $845. For more visit: www.sbr.gov.bc.ca/hog

2008 and 2009: the threshold = $1,164,000 (see above for details).
In 2007, the grant was increased from $780,000 to $950,000.
In 2006, the grant was increased from $685,000 to $780,000.
In 2005, the grant was increased from $585,000 to $685,000.
In 2004, the grant was increased from $525,000 to $585,000.

Interesting facts

Historically speaking, Canadian mortgage rates are on the very low side. On April 21, 2009 the Bank of Canada dropped its rate to 0.25% - the lowest ever. It is an obvious fact that the bank rate can't go much lower.

The Bank of Canada will begin to raise its rates in the near future. The banks, as of March 2010, have already done so.

Based on information from the Bank of Canada, I found that the lowest Canadian bank rate (since 1935) was 1.22% in July 1958. And that was for only one month. From 1945 to 1950 it was 1.50%. On Sept. 29, 1960, the Canadian bank rate dropped to a low of 1.93% for a short time. Then, not till January 2002, when the bank rate went down to 2.25%, had we seen really low rates. In fact, the peak was in August 1981 when the bank rate hit the extreme high of 21.03%.

Compare the cost of borrowing $100,000:

January 2009 - $100,000 at around 3.50% (1 yr mtge) with a monthly payment of $499.27
August 1981 - $100,000 at rates about 23% (1 yr mtge) with a monthly payment of $1838.75

That's a difference of $1339.48 per month. In 2009, Canadians can borrow approx. $368,000 for the cost of borrowing $100,000 in 1981.

To act as a guide for borrowers, just below, you will find a list of some of the best, current Canadian mortgage rates.

If you have questions, please don't hesitate to call me (my number is at the bottom of this page) or send me an e-mail.

Canadian Mortgage Rates
Last Update: July 20, 2010

General Trend: Stable

The schedule of key interest rate announcements by the Bank of Canada for 2010:
Jan 19, March 2, April 20, June 1, July 20, Sept 8, October 20, and last, Dec 8/10.

History of the Target for the overnight rate:

July 20/10 - up 0.25 to 0.75%
June 1/10 - up 0.25 to 0.50%
June 4/09 -April 20, 2010 - no change
April 21, 2009 - down 0.25 to 0.25%
March 3, 2009 - down 0.50 to 0.50%
Jan. 20, 2009 - down 0.50 to 1.00%
Dec 9, 2008 - down 0.75 to 1.50%
Oct 21,, 2008 - down 0.25 to 2.25%
Oct 8, 2008 - down 0.50 to 2.50%
June 10 - Sept 3, 2008 - no change
April 22, 2008 - down 0.50 to 3.00%
March 4, 2008 - down 0.50 to 3.50%
Jan. 22, 2008 - down 0.25 to 4.00%
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Dec. 4, 2007 - down 0.25 to 4.25%
Oct. 16, 2007 - no change
Sept. 5, 2007 - no change
July 10, 2007 up +0.25 to 4.50%
July 11, 2006 - May 29, 2007 - no change
May 24, 2006 up +0.25 to 4.25%
April 25, 2006 up +0.25 to 4.00%
March 7, 2006 up +0.25 to 3.75%

January 24, 2006 up +0.25 to 3.50%
January 25, 2005 was 2.50%

Current Canadian Mortgage Rate: a) discounted & b) posted: