Owning a Home During a Seperation

We all know that marriage isn't always forever. And when a separation occurs, a home is often involved. Since most couples have a joint mortgage – one where both names are on the mortgage and title of the home – when separation or divorce proceedings occur, many wonder what will happen with the home.

When the marriage comes to an end, there are two obvious options concerning the home: 1) sell the property and split the proceeds according to your agreement and go your separate ways; or 2) one person buys the other party out of the mortgage and the title of the property.

The first option is a straight-forward transaction where you put the house up for sale, sell and split the proceeds. The second option, however, is slightly more complicated.

The decision between the options is a personal one borne out of the specific circumstances of the parties involved. Perhaps there are young kids involved that need to stay in the house, the market is down and there will be a loss on the property that neither party can afford, one party can afford to buy the other party out, etc.

Once the decision is made, how do you go about buying the other person out of a mortgage?  Well, essentially, you’re refinancing your mortgage using a single income (the person who is buying the other party out of the house) and qualification, versus the original purchase, which was based on joint income and qualification. 

If you’re the one buying your partner out, the first step is to ensure that you can afford the mortgage payments. This is imperative because the lender will ask for proof that you’re capable of covering the mortgage in order for you to apply on your own. In addition to covering the mortgage amount, you’ll have to come up with whatever dollar amount you have agreed on to buy the other partner out. This may come out of the equity in your home if it’s sufficient.

In essence, if you can afford the mortgage on your own, the most common means of buying out your partner post-separation and transferring title out of the joint name and into your name, is to refinance.

If you’re not in a financial position to buy your ex-partner out of the house, and you agree to both stay on title and have payment arrangements, there is one warning to be taken very seriously. Just because one person is responsible for the payments (even with a court order), if the mortgage goes into default, both parties on the mortgage will be affected.

The most important piece of advice when dealing with a mortgage during a separation is to become informed. Know your options, talk to professionals about your options, and make an informed decision regarding your home and mortgage.  

Canadian Monthly GDP Growth

The Canadian economy grew 0.3 per cent in February, building off of a similar gain in January.  At the industry level, economic growth was led by natural resource extraction activities but also received a boost from construction, forestry, and manufacturing. 

Economic growth has been stronger than expected over the first two months of the first quarter. As a result., we have revised our first quarter GDP growth estimate upward from 1.5 per cent to between 1.5 and 2 per cent. 

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US Q1 Real GDP Growth

The US economy grew 2.5 per cent in the first quarter of 2013, falling short of consensus expectations of 3 per cent. Most of the shortfall in growth was the result of an 11.5 per cent drop in defense spending, which led US government spending lower for the tenth time in the past eleven quarters.  On the positive side, consumer spending posted its largest increase in two years, expanding 3.2 per cent.   

It is worth noting that today's release is a preliminary estimate and will be revised in subsequent months. The recent trend has been upward revisions and so it is likely that the US economy actually grew at a slightly faster pace than initially estimated. That said, we do expect some weakness in the second and third quarter of this year due to further declines in government spending. However, that weakness should give way to stronger growth later in 2013 and into 2014 when we forecast the US economy will grow at a rate of above 3 per cent. 

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Canadian Retail Sales

Canadian retail sales rose for the second consecutive month, advancing 0.8 per cent in February. Higher sales were reported in 7 of the 11 retail sub-sectors. However, inflation adjusted sales were flat. Even with a relatively strong start to the year for the retail sector, we are still tracking first quarter real GDP growth in the Canadian economy at around 1.5 per cent

Retail sales in BC diverged from the national trend, falling 0.3 per cent on a monthly basis and declining 1 per cent year-over-year. We anticipate that BC retail sales will post below average growth in 2013, perhaps around 3 per cent but with some risk to the downside. 

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Consumer Price Inflation

Canadian consumer prices rose just 1 per cent in the 12 months to March, a slight deceleration from 1.2 per cent in February. The dip in inflation was primarily the result of lower gasoline prices, though inflation was broadly weak across all CPI components. Core inflation, which strips out the most volatile components of the CPI, such as food and energy prices, increased 1.4 per cent in March. Inflation in BC was also muted with consumer prices rising just 0.5 per cent on an annual basis. 
Inflation continues to trend well below the Bank of Canada's 2 per cent target rate, a trend we expect to continue through 2013 due to sluggish economic growth and muted inflationary pressure from wages. This low rate of inflation will keep the Bank of Canada sidelined through  at least the remainder of 2013 and likely for much of 2014. 

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Multi-Stakeholder Workshop Generates Action Plan for Floodplain Mapping

The British Columbia Real Estate Association (BCREA) today published its Floodplain Maps Action Plan following its March 8, 2013 multi-stakeholder workshop on floodplain maps. With 69 per cent of existing floodplain maps available online from the provincial government being 20 to 25 years old, outdated floodplain maps compromise the ability of decision makers to effectively assess and manage flood risks, putting BC communities in jeopardy.

Flooding poses catastrophic risks to BC’s economic vitality, safety, environment, property owners and communities, so flood protection is an important issue for the Association,” said BCREA Chief Executive Officer Robert Laing. “By working with other stakeholders, we wanted to generate consensus around key actions to update existing floodplain maps and keep them current.”

Nearly 70 decision makers and practitioners involved with flood management, land use and emergency management attended the March 8 workshop in Vancouver. Attendees expressed their shared concerns for BC communities and discussed technical, financial and political perspectives in terms of challenges and opportunities.

The floodplain maps workshop fits right into our fresh water sustainability grant focus area,” said Kelly Lerigny, Chair of the Real Estate Foundation of British Columbia, which financially supported the event. “Coupled with the fact that there was such a wide range of stakeholders involved, we were excited to fund the workshop and help make the Action Plan possible.”

The event was also supported by Simon Fraser University's ACT (Adaptation to Climate Change Team). "Up-to-date information is essential if we are to adequately plan and prepare for the impacts of climate change," said ACT Executive Director Deborah Harford. "BC needs current floodplain maps that incorporate climate change projections to ensure the well-being of our citizens and our economy."

A floodplain map is a tool that shows areas that are subject to high flood hazard, and they help form the foundation on which many decisions are made about how and where communities grow. There are currently 87 existing floodplain maps available through the BC Ministry of Environment website. Experts recommend that floodplain maps should be updated every ten years.

If we don’t know what the risks are, we can’t adapt to changes in the environment. Climate change is one thing, but since the plans were last updated, we’ve also seen dramatic population growth, and changes to the actual contours of rivers,” said Anna Warwick Sears, Executive Director of the Okanagan Basin Water Board. “If we act now, BC communities can protect homes and businesses, and save a tremendous amount of future heartbreak and expense.”

Key points in the Action Plan include creating a Working Group to move the actions in the plan forward; assessing the capacity of local governments to update floodplain maps; recommending that the provincial government take back responsibility for floodplain mapping, with maps being updated every ten years; expand the scope of the Flood Protection Program to include technical studies and leverage funds to create a province-wide plan to complete floodplain mapping.

The Floodplain Maps Action Plan can be found here: www.bcrea.bc.ca/docs/floodplainmaps_action_plan.

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Updated CREA Market Forecast

The Canadian Real Estate Association (CREA) has updated its forecast for home sales activity via the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards and Associations in 2013 and extended the outlook to include 2014.

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426 Anderson,Nelson BC

An absolutely charming 3 bedroom home tucked away in lower Fairview. This home features stained glass accents, warm wood floors and an artist’s palette of colour.  The large yard features some beautiful rock work, fruit trees and garden areas. 

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Canadian Housing Starts

Canadian home-builders broke ground on 184,208 new units at a seasonally adjusted annual rate (SAAR)in March, a slight increase from February's 183,207 starts. However, new home construction continues to trend lower from last year's highs. On a year-over-year basis, housing starts were down 15.5 per cent.

New home construction in BC urban centres rose 13 per cent month-over-month in March to a seasonally adjusted annual rate of 24,400 units. On a year-over-year basis, total starts were 18 per cent higher than March 2012. Single-detached starts were 16 per cent lower over last year, while multiples bounced back from a steep year-over-year-decline in February, rising 33 per cent compared to March 2012. The first quarter of 2013 saw a 13 per cent decline in total housing starts compared to the first quarter of 2012.

Looking at census metropolitan areas (CMA) in BC, in the Vancouver CMA total starts rose 35 per cent year-over-year due to a 42 per cent jump in multiple starts. Single-detached starts were also up by 2 per cent..  New home construction in the Abbotsford CMA continued to recover from a difficult 2012, rising 57 compared to March 2012. Conversely, housing starts in the Victoria and Kelowna CMAs declined year-over-year in March, falling by 10 per cent and 27 per cent respectively. 

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Nelson Star - Valhalla Path Realty gives to Nelson Civic Theatre Society

Nelson Star - Valhalla Path Realty gives to Nelson Civic Theatre Society