Blu’s News : February 2025
According to the Chinese Zodiac, the Year Of The Snake is about letting go of the past, making big changes, and strategizing before striking. From a real estate perspective, this sounds exciting. But if you’re one of the 1.2 million Canadian homeowners whose mortgages are up for renewal, 2025 might feel a little daunting. That’s why we’ve enlisted trusted Mortgage Advisor Reza Sabour to help guide us along the winding road ahead.
Shawn Lee: Many of our clients are currently locked into ultra-low rates around 1.8%, but with their mortgages coming up for renewal this year, they’re facing the reality of rates in the mid-4% range. Understandably, they’re concerned about how this will impact their monthly payments. For those who still have around six months before their renewal date, are there any steps they can take now to help ease the transition?
Reza Sabour: Great question! There are a few things they can do in anticipation of renewal to get a better handle on their finances. I’d suggest they use their pre-payment options to pay down some of their principal with a lump sum payment. This can help offset the sticker shock of the higher renewal rate, and since that amount goes directly to principal, it will reduce their renewal balance at maturity. Most lenders allow borrowers to prepay up to 15% to 20% of their mortgage every year, so it’s worth looking into.
Shawn: With all the news about tariffs kicking in this March, our clients are asking what’s going to happen to rates. Should they wait to see the impact before accepting what their lender is offering?
Reza: First off, they should never accept their lender’s initial offer without consulting a Broker first—they could be leaving money on the table without realizing it. As for the tariffs, it’s hard to predict exactly what will happen, but we do know they’ll have an impact. Initially, we might see layoffs and reduced household spending, which could push the Bank of Canada to continue cutting rates to stimulate the economy. However, tariffs are inherently inflationary, and if inflation picks up, the BoC might have to reverse course and increase rates instead. Timing the market is impossible—just like with stocks. The best time for your clients to negotiate their rate is when they and the lender are both engaged and eager to move forward. And, of course, they should be consulting a Broker to understand their options.
Shawn: Our clients who are renewing are wondering if they should take a fixed or variable rate mortgage. What do you advise?
Reza: It depends on their individual situation, and both options come with pros and cons. Fixed rates offer predictability in payments, but they also come with potential drawbacks—like higher penalties if they need to break their mortgage early or refinance before maturity. There’s also the opportunity cost of locking in at a higher rate if rates drop during their term. On the other hand, variable mortgages come in two types: one with static payments and one with adjustable payments. Each has its own advantages and risks, especially in an uncertain economic climate like Canada’s right now. Their Mortgage Broker can help them assess their plans and determine which option makes the most sense.
Shawn: Some of our clients are worried they won’t be able to afford their new payments after renewal and don’t have the means to pre-pay their mortgage beforehand. What are their options if they fall into financial hardship?
Reza: If all other options have been exhausted, they may need to consider selling their home to downsize or even renting for a few years until the economy stabilizes and rates come back down. The key here is for them to be kind to themselves—this isn’t a failure, it’s a financial reset. There’s no shame in making a smart decision that allows them to rebuild. The most important thing is that they understand this is just one chapter in their life, not the whole story. Encourage them to talk to their Broker about alternative solutions and to involve you in finding the right next move, whether that’s a smaller home, a rental, or another financial strategy. If you decide to stay in your home, your bank may also have some options to work with you on payment plans that can better fit your ability to remain in your home. Outside of that, if you’re over the age of 55, we can also look at Reverse Mortgage options that can be a great way of staying in your home without any monthly payments.
Shawn: We’ve been hearing from some clients who are finding it tough to qualify for a mortgage due to significant changes in their financial situation. In particular, some business owners are doing well now but haven’t shown enough declared income in recent years to meet traditional lending requirements. Are there still options available for them, or are they out of luck?
Reza: Not at all! There are always options if they know where to look. This is where alternative lending channels shine, especially in uncertain times like these. If they’ve had financial hardship or have structured their income to minimize taxes, there are B-lenders and other financing solutions that can work with their business revenue instead of traditional income documentation. In many cases, working with a B-lender can actually save them thousands in taxes while still allowing them to qualify for a mortgage. Their Broker can walk them through these options and find the right solution based on their unique situation.
As Reza said, everyone’s situation is unique. If you have mortgage questions we didn’t cover today, feel free to contact Reza’s via his website. And for more on how mortgages impact the Vancouver Real Estate Market, check out our boss man’s breakdown in the video below.
Shawn Lee: Many of our clients are currently locked into ultra-low rates around 1.8%, but with their mortgages coming up for renewal this year, they’re facing the reality of rates in the mid-4% range. Understandably, they’re concerned about how this will impact their monthly payments. For those who still have around six months before their renewal date, are there any steps they can take now to help ease the transition?
Reza Sabour: Great question! There are a few things they can do in anticipation of renewal to get a better handle on their finances. I’d suggest they use their pre-payment options to pay down some of their principal with a lump sum payment. This can help offset the sticker shock of the higher renewal rate, and since that amount goes directly to principal, it will reduce their renewal balance at maturity. Most lenders allow borrowers to prepay up to 15% to 20% of their mortgage every year, so it’s worth looking into.
Shawn: With all the news about tariffs kicking in this March, our clients are asking what’s going to happen to rates. Should they wait to see the impact before accepting what their lender is offering?
Reza: First off, they should never accept their lender’s initial offer without consulting a Broker first—they could be leaving money on the table without realizing it. As for the tariffs, it’s hard to predict exactly what will happen, but we do know they’ll have an impact. Initially, we might see layoffs and reduced household spending, which could push the Bank of Canada to continue cutting rates to stimulate the economy. However, tariffs are inherently inflationary, and if inflation picks up, the BoC might have to reverse course and increase rates instead. Timing the market is impossible—just like with stocks. The best time for your clients to negotiate their rate is when they and the lender are both engaged and eager to move forward. And, of course, they should be consulting a Broker to understand their options.
Shawn: Our clients who are renewing are wondering if they should take a fixed or variable rate mortgage. What do you advise?
Reza: It depends on their individual situation, and both options come with pros and cons. Fixed rates offer predictability in payments, but they also come with potential drawbacks—like higher penalties if they need to break their mortgage early or refinance before maturity. There’s also the opportunity cost of locking in at a higher rate if rates drop during their term. On the other hand, variable mortgages come in two types: one with static payments and one with adjustable payments. Each has its own advantages and risks, especially in an uncertain economic climate like Canada’s right now. Their Mortgage Broker can help them assess their plans and determine which option makes the most sense.
Shawn: Some of our clients are worried they won’t be able to afford their new payments after renewal and don’t have the means to pre-pay their mortgage beforehand. What are their options if they fall into financial hardship?
Reza: If all other options have been exhausted, they may need to consider selling their home to downsize or even renting for a few years until the economy stabilizes and rates come back down. The key here is for them to be kind to themselves—this isn’t a failure, it’s a financial reset. There’s no shame in making a smart decision that allows them to rebuild. The most important thing is that they understand this is just one chapter in their life, not the whole story. Encourage them to talk to their Broker about alternative solutions and to involve you in finding the right next move, whether that’s a smaller home, a rental, or another financial strategy. If you decide to stay in your home, your bank may also have some options to work with you on payment plans that can better fit your ability to remain in your home. Outside of that, if you’re over the age of 55, we can also look at Reverse Mortgage options that can be a great way of staying in your home without any monthly payments.
Shawn: We’ve been hearing from some clients who are finding it tough to qualify for a mortgage due to significant changes in their financial situation. In particular, some business owners are doing well now but haven’t shown enough declared income in recent years to meet traditional lending requirements. Are there still options available for them, or are they out of luck?
Reza: Not at all! There are always options if they know where to look. This is where alternative lending channels shine, especially in uncertain times like these. If they’ve had financial hardship or have structured their income to minimize taxes, there are B-lenders and other financing solutions that can work with their business revenue instead of traditional income documentation. In many cases, working with a B-lender can actually save them thousands in taxes while still allowing them to qualify for a mortgage. Their Broker can walk them through these options and find the right solution based on their unique situation.
As Reza said, everyone’s situation is unique. If you have mortgage questions we didn’t cover today, feel free to contact Reza’s via his website. And for more on how mortgages impact the Vancouver Real Estate Market, check out our boss man’s breakdown in the video below.
Real Insights with Shawn Lee:
Empty Home Vs. Speculation Tax
We know that receiving two separate tax notices every year can be confusing – and sometimes downright frustrating. To help clear up the confusion, here’s a quick rundown on the differences between Vancouver’s Vacancy Tax and BC’s Speculation Tax, along with some tips to keep you on track.
Vancouver’s Vacancy Tax
Administered by the City of Vancouver, this tax targets properties that remain unoccupied for a significant part of the year. Its goal is to encourage homeowners to either rent or sell empty properties, thereby increasing local housing availability. The filing deadline for the vacancy tax was February 4 this year, so if you haven’t already submitted your declaration, that deadline has just passed. The good news is that you can still make a late declaration up to July 3, 2026.
BC’s Speculation Tax
This provincial measure is designed to reduce speculative ownership in the housing market by targeting certain properties – often those owned by non-residents or satellite families – to ensure homes remain available for local residents. Although it might seem similar to the vacancy tax, the speculation tax has its own distinct filing deadline, which is March 31 this year. Remember, filing one does not cover the other!
Why Filing Both Matters
It’s important to understand that these are two distinct programs. Filing only one when you’re required to file both can lead to penalties. Many property owners mistakenly assume that one declaration covers both taxes, a mix-up that has led to missed filings more often than you’d think. While hard statistics on this confusion are hard to come by, community feedback suggests it’s a common issue.
Tips to Stay Compliant
• Double Check Your Notices: Each notice contains specific instructions – take a moment to read them carefully.
• Mark Your Calendar: Note the deadlines (February 4th for the vacancy tax and March 31st for the speculation tax) to avoid any last-minute surprises.
• Ask Questions: If you’re ever in doubt about which form to complete or when it’s due, please don’t hesitate to reach out for clarification.
We understand that handling two almost identical declarations can feel like an unnecessary hassle. And speaking of taxes, we haven’t even gotten around to property taxes yet – that’s a whole other conversation for another newsletter!
Vancouver’s Vacancy Tax
Administered by the City of Vancouver, this tax targets properties that remain unoccupied for a significant part of the year. Its goal is to encourage homeowners to either rent or sell empty properties, thereby increasing local housing availability. The filing deadline for the vacancy tax was February 4 this year, so if you haven’t already submitted your declaration, that deadline has just passed. The good news is that you can still make a late declaration up to July 3, 2026.
BC’s Speculation Tax
This provincial measure is designed to reduce speculative ownership in the housing market by targeting certain properties – often those owned by non-residents or satellite families – to ensure homes remain available for local residents. Although it might seem similar to the vacancy tax, the speculation tax has its own distinct filing deadline, which is March 31 this year. Remember, filing one does not cover the other!
Why Filing Both Matters
It’s important to understand that these are two distinct programs. Filing only one when you’re required to file both can lead to penalties. Many property owners mistakenly assume that one declaration covers both taxes, a mix-up that has led to missed filings more often than you’d think. While hard statistics on this confusion are hard to come by, community feedback suggests it’s a common issue.
Tips to Stay Compliant
• Double Check Your Notices: Each notice contains specific instructions – take a moment to read them carefully.
• Mark Your Calendar: Note the deadlines (February 4th for the vacancy tax and March 31st for the speculation tax) to avoid any last-minute surprises.
• Ask Questions: If you’re ever in doubt about which form to complete or when it’s due, please don’t hesitate to reach out for clarification.
We understand that handling two almost identical declarations can feel like an unnecessary hassle. And speaking of taxes, we haven’t even gotten around to property taxes yet – that’s a whole other conversation for another newsletter!
Out and About
One of the reasons Vancouver is consistently named one of the prettiest cities in the world is because of our majestic mountains. From Feb 21st - March 23rd, you can enjoy films, speakers, and workshops inspired by the beauty of the magical mountains.
Agent of the Month:
Nels Agerbo
Nels Agerbo has once again clinched the title of agent of the month. Which is no surprise, considering this long-time Blu grinder is one of the kindest and hardest working in the business. Nels has been in a sweet spot for the last few years, inking many deals and linking almost as many turn up in his happy place, Whistler, BC. Isn’t it good to know that nice guys do finish first?
Local Spotlight:
Goldbarr Garages
This month, we’re shining the Blu spotlight on Sea to Sky’s GoldBarr Garages. Owners Davey Barr and Goldie Smith are OG Whistler boys (with plenty of toys) who know the value of an organized, functional space. They install custom cabinetry, Storewall accessories, polyaspartic floor coatings, and they’re beauties to boot. Check them out if your garage needs a little love this spring.
Featured Listings
Subscribe To Our Newsletter
If you enjoyed reading our Newsletter you won’t want to miss our next one!
Fill in your information below to subscribe and receive our Newsletters in your email inbox every month.
Fill in your information below to subscribe and receive our Newsletters in your email inbox every month.
