Q. How much are closing costs?
A. You should allow approximately $1,500 for legal fees to have a lawyer convey the transaction to your name with the B.C. Land Titles Office. You'll also need to budget for adjustments to the taxes and sewer/water. This could be anywhere from a few hundred dollars to a couple of thousand depending on the property and time of year. Also, don't forget about our provincial Property Purchase Tax, which amounts to 1% on the first $200,000 and 2% on the remainder.
Q. How do think hosting the 2010 Winter Olympics will affect the Whistler real estate market?
A. It's hard to gaze into the crystal ball on this issue. I do know that our winning the bid has been nothing but positive for our resort community and the Sea to Sky Corridor in general. Our already robust real estate market is already benefitting from the capital improvements, legacies, and worldwide advertising that the Games will bring to our community. Just think of Lake Placid and Squaw Valley. Tourists from all across the globe still flock to these places because they once hosted the Winter Olympics.
Q. I'm thinking of selling my Whistler property. What are some of the costs involved? What about Capital Gains Tax?
A. It is a condition of a non-resident selling property in Canada that they first obtain a Clearance Certificate from Canada Customs & Revenue Agency. The current wait for a Clearance Certificate (as of January 2007) is approximately 6 to 8 weeks. Prior to Canada Customs & Revenue Agency issuing a Clearance Certificate they will wish to collect any tax payable with respect to the property - this will include any tax payable on the rental income from the property which has not already been remitted as well as tax on the capital gain experienced on the property and if applicable, recapture of capital cost allowance.
In calculating the capital gain on the property Canada Customs & Revenue Agency allows only the following to be added to the purchase price to determine the adjusted cost base:
Property Transfer Tax which is 1% on the 1st $200,000 and 2% on the remainder. Legal fees and disbursements in conjunction with the purchase Furnishings and renovations included in the selling price;(receipts for the included items will be required). It is critical that you retain receipts for the furnishings and that they identify the furnishings and as having been acquired for the Whistler property as well as any Customs documentation showing furnishings acquired in other jurisdictions have been brought to the Whistler property. Goods and Services Tax (GST) which is 5% A portion of the interest on mortgage payments (only if the Vendor has properly elected to have the interest capitalized on their tax return). Canada Customs & Revenue Agency does not allow any deductions from the selling price in determining the gain (i.e. you cannot subtract the real estate commission, legal fees or GST paid on the selling commission). The amount required to be remitted on the gain is typically 15 to 20% of the gain. By filing a Canadian tax return subsequent to the sale, you can claim expenses such as commission and legal fees and some of the tax paid may be recovered. Sellers should contact their accountants or lawyers with respect to requesting a Clearance Certificate as soon as an accepted offer has been received with respect to the property. Should the completion date be prior to the issuance of the Clearance Certificate, a holdback of between 25% and 50% of the sale price will be required by the Buyer's lawyer before the Clearance Certificate is issued.
Please note that the Buyer's lawyer may take the position that if the property has been rented out it is a depreciable property and therefore the holdback is 50% on the portion of that purchase price that relates to the building.
If you are a foreign investor/foreign owner and you are thinking of selling your property in Whistler, you thing you will need to obtain is a Clearance Certificate...
Q. I now have an accepted subject offer to sell my Whistler property. What happens next?
A. Now you can relax and let me continue to go to work for you. I'll handle everything from tracking down all the strata meeting minutes, AGM minutes and Form B from your strata manager (if you own a condo) to accompanying the building inspector into the property and all the while making sure every one of the buyer's (and your) questions are answered. I'll do my very best to make sure the buyer's subjects get removed on time so that everything goes as smoothly as possible.
Q. Now we have a firm contract with subjects (conditions) removed. What do we do now?
A. The hard part's over. Now I handle getting all the required documents out to your lawyer. He'll draft all the applicable transfer papers and courier them out to you. You'll need to sign, have them notarized, and courier them back to your lawyer as quickly as possible. If you live close to your lawyer in Vancouver or Whistler you can probably just go over to his/her office to sign the paperwork.