Despite the plethora of new regulatory policies focused on the demand side of the transaction, buyer activity has been picking up over the last couple of weeks. Homes that have been sitting on the market are suddenly going into multiple offers, largely a function of low inventory—though it could be more of a dead cat bounce. Given the lack of listings buyers have to shop from, it’s too early to recognize whether the trend will continue, particularly with another rate hike announcement expected on January 25th. Once potential sellers start seeing activity happen, they may be more motivated to get their homes on the market, only time will tell. Mid-way through January there were 334 sales in Greater Vancouver, with North Vancouver, West Vancouver, New Westminster and Port Moody being the slowest, and Coquitlam showing a higher pace of new condo listings so far for the month.
It’s interesting to compare a shifting market that was down 34% in 2022 to a thriving property market like Dubai, which Crown Prince Sheikh Hamdan noted as “exceptional” in 2022—up 44.7% to 122,658 transactions. Both cities are among the world’s most attractive investment destinations, but the latter with more supportive regulations.
Of the 2.6 million+ residents in Metro Vancouver, Chinese Canadians enumerated nearly 20% of the total regional population (census 2021). Being that half of my ethnic background is Singaporean, I have fond memories of Lunar New Year celebrations—this year it falls on Sunday, January 22nd, 2023, starting the Year of the Rabbit. Those born in the Year of the Rabbit are talented and affectionate and are seekers of tranquillity.
Lunar New Year, also known as the Spring Festival, is the most celebrated and longest of all Asian festivals and is observed by millions of people around the world. Also known as Chinese Chunjie, Vietnamese Tet, Korean Solnal, and Tibetan Losar, a number of other countries in East Asia hold their own new year celebrations at this time. Lunar New Year celebrates the beginning of spring and the arrival of the new year, with festivities lasting until the following full moon, typically 15 days. One of the more symbolic traditions, the red envelope, is called ya sui qian (压岁钱 /yaa sway chyen/), which means ‘suppressing Sui [the demon] money’. Those who receive a red envelope are wished another safe and peaceful year.
Below are a few events happening around the Lower Mainland if you are looking for a way to participate in the festivities with your family. May you be blessed with the best of health, happiness and success in this Year of the Rabbit.
Lunar New Year Events in Metro Vancouver
Family Fun Lunar New Year Celebration
Bring your whole family to Gateway Theatre for a joyful experience listening to a live reading of Bun Fun New Year (繽紛新年) – a humorous tale of Bunnifer and Bunnithy as they prepare a traditional Lunar New Year family feast. Welcome the Year of the Rabbit by practicing some ‘bunny dance moves’ and let your children’s imagination soar with themed craft activities prepared for you.
Dr. Sun Yat-Sen Classical Chinese Garden
January 21st and 22nd (11 am to 6 pm)—immerse yourself with an array of performances (including Lion Dance, Guzheng and City Opera Vancouver), Arts & Crafts, activities & activations, delicious food and witness the premiere of a brand new Exhibition by Chairman Ting.
One of the city’s largest annual parades is returning to Chinatown in 2023 to help kick off Lunar New Year celebrations in Vancouver. The 48th Vancouver Chinatown Spring Festival Celebration will return after two-year hiatus on Sunday, January 22, 2023, the first day of the Year of the Rabbit. The popular event has attracted over 4,000 participants and 100,000 spectators to the neighbourhood, with family-friendly activities, live entertainment, and more for everyone to enjoy.
On January 1, 2023, the Residential Property Flipping Rule took effect to guarantee that earnings from flipping residential real estate are fully taxed. Profits from selling residential properties, including rental properties, in possession for less than a year would be considered business income.
A “flipped property,” according to Bill C-32, is “a dwelling unit of a taxpayer situated in Canada that the taxpayer possessed for fewer than 365 days in a row (less than a year) previous to the disposition of the property.” Residential homes sold on or after January 1, 2023, would be subject to the measure.
If flipping properties is your way of making an income, this new bill will impact your business plans for 2023. While this is helpful for those finding unaffordability caused by renovations-for-profit, it will change how investors operate.
Homeowner Grant Threshold
The Home Owner Grant threshold increased from $1.975 million to $2.125 million for 2023. To qualify for the grant, owners must be the principal resident of the property, a Canadian citizen or permanent resident of Canada, and must live in BC.
First Home Savings Account
Helps Canadians buy their first home by introducing the Tax-Free First Home Savings Account to allow first-time home buyers to save up to $40,000; doubling the First-Time Home Buyers’ Tax Credit to $10,000, providing up to $1,500 in direct support to home buyers; extending the First-Time Home Buyer Incentive to March 31, 2025, to allow first-time home buyers to lower their borrowing costs; and investing $200 million to help develop and scale up rent-to-own projects across Canada.
Beginning in April, first-time home buyers may save up to $40,000 tax-free with the help of the Tax-Free First Home Savings Account (FHSA), which has an $8,000 yearly contribution cap. The FHSA, a saving account designed to help you save money and make your dream of home ownership come true, was created to help first-time home buyers save for the future without paying taxes. This is favourable for first-time buyers and people saving for their future goals.
Banking Regulator Proposes Mortgage Restrictions
OSFI is considering limiting the number of high income to loan ratios, and a stricter stress test for variable rate mortgages. 57% of all borrowers went variable in 2022, and are already being stress tested at 8%! That does not bode well for home prices.
CMHC Housing Shortage Estimate
CMHC stated there will be a housing shortage of 3.5 million by 2030 if the rate of building continues. The dip in house prices will not last.