At the end of last year, the BC Government passed amendments to the Strata Property Act taking effect on November 24, 2022. There are two significant changes that impact residential properties that deal with strata.
Let’s take a deeper look into each amendment and how they impact you.
You have more potential homes that meet your ‘must have’ and ‘nice to have’ criteria. This will greatly improve your chances of finding your dream home. This is particularly beneficial for families or young couples who are planning to start a family in the near future.
Without rental restrictions you can also buy with more confidence that your investment is safeguarded for the future. You will always have the option to rent out your home as your real estate portfolio grows, or to help bridge financing between future moves.
The change to the Strata Property Act came into effect fast and as result not all strata corporations have had the opportunity to update their specific bylaws. Amendments to property specific bylaws must be approved at an annual or special general meeting (despite the fact that government laws will override). The strata documents you receive and review as a buyer over the coming months may therefore not be updated.
Condo and townhome owners can list more competitively. Your home will match more search criteria giving you a larger reach of potential buyers to attract. This will help you greatly in being able to sell in a more timely manner.
While strata living has its advantages, these changes to the Strata Property Act have been received with mixed feelings. Smaller complexes and self-managed properties depend heavily on the sense of community it fosters. Fee increases and counter restrictions in strata by laws may very well be implemented over the coming months to protect this. The time from accepted offer to removal of subjects could possibly take longer as a result.
BENEFITS AS AN INVESTOR
Have you been sitting on a vacant property (paying vacancy tax) all because you haven’t been able to rent out your property due to former restrictions in the Strata Property Act, and you don’t want to sell. Problem solved. NB. by laws restricting short-term rentals (like AirBnB) will continue to be allowed.
It’s a buyer’s market right now, but mortgage rates are sky high and the rental market – i.e., how much you can receive per month – is coming down.
Raising the rent is controlled by the BC government and annual allowable increases vary year over year. For example, the 2023 maximum increase is 2%. If you’re on a variable mortgage rate, and as we’ve seen in 2022 alone, it’s quite possible that your interest rate can exceed your rent increase allowance.
So while a rental property is a reliable investment in the long run, it’s vital to assess all the financial obligations and restrictions that come with it.
Overall this amendment is a positive step towards improving the affordability and scope of housing across the province. However, as a homeowner with no plans or desires to either sell, buy, or invest in the near future I can appreciate the feelings of uncertainty and discomfort as the reality of the change starts to impact lifestyle choices. Some homeowners were attracted to their property for the reason that rentals were restricted. This has historically been desired for the perception of increased security and less risk to damage of the property and common areas.
As aforementioned, the recent amendments to the Strata Property Act have been received with mixed reviews. What do you think? Will this move solve the housing problems in BC? Share your thoughts in the comments below.
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102-321 Sixth St,
New Westminster, BC, V3L 3A7