BCBusiness

RIGHT: COURTESY OF ANDREW KARPIAK, ROYAL LEPAGE WESTWIN REALTY; SOURCES: STATISTICS CANADA, BC ASSESSMENT JUNE 2019 BCBUSINESS 39 be the most signicant factor. "The overall theme in all the data is that we have the B20 stress test happening, which aects all markets, swamping all other trends," Ogmundson says. Financing a vacation home can present its own, unique hurdles. Even for those who come armed with a pre-approved mortgage, nancing a purchase in some regions can be di‚cult. If you're looking to buy in, say, Whistler or the Okanagan, there's usually no problem, since there are several valuation tools to assess property prices and ensure that a lender's exposure risk remains within acceptable parameters. But once a buyer starts looking farther aeld, the process becomes more com- plex, says Vancouver-based Rob Regan- Pollock, vice-president of the B.C. chapter of the Canadian Mortgage Brokers Asso- ciation. "A cottage on a lake in the middle of nowhere: that's when the lenders start to apply dierent criteria," he says, add- ing that for many of these properties, a 35-percent minimum down payment is not uncommon. And you'll likely be on the hook for a bank-approved appraiser to travel to the site, too. That's not all. You'll also have to sat- isfy lender concerns about water potabil- ity and the state of the septic system. And you might want to avoid any dwellings that aren't built on concrete. "If it's a non- continuous foundation, or a wood or block foundation, lenders are typically not inter- ested," Regan-Pollock says. "They want to make sure the economic life of a particular dwelling is going to exceed amortization by ve years." And for those who fall in love with an unserviced lot in a remote location? "If the lot is not serviced, there are very few lend- ers that will actually lend on that type of land," Regan-Pollock explains. "The ones that do, institutionally, usually require 50 percent down." And, he adds, collateral in the form of a more easily traded urban property—like your principal residence. Trouble in paradise Ultimately, as with so many real estate pur- chases, when it comes to buying a vacation property, emotion is the primary driver, overwhelming rationale and snapping best-laid plans like so much deadwood. It's the power of the dream, of course. For some, the dream will come with unanticipated costs. British Columbians whose long-term goal is to eventually tran- sition to their place in the country (while keeping their family home in the Lower Mainland, Victoria or Nanaimo, for exam- ple) will have to factor the speculation and vacancy tax into their retirement plans. If they spend more than six months in paradise, they could be forced to rent out their family homes or pay the tax—more signiœicantly, their principal residence capital gain exemption will then be on the line, too. And for those who buy property with an eye toward eventually selling it to nance their golden years? A cabin is not a shoebox full of Apple shares. It can take a long time to shift a rural property. As an asset class, recreational property is hardly liquid. Then there's the health-care wild card, something often lost in the excitement of the purchase, especially if buyers are younger. Hospitals in major urban centres are better equipped to deal with a wider range of emergencies and signicant health issues than their rural counterparts. If your Plan B includes downsizing to the country- side, this may not end up being trivial. But again, once your mind is made up to buy a vacation property, it's often emotion —the walloping kick to your amygdala that occurs when desire and possibility collide—that will be the deciding factor. Even for those who, like Kate MacLen- nan and Alex Harvey-Wickens, treat the search largely as an exercise of reason over passion. In the end, though, the couple got almost all of what they wanted. Waterfront? Check. Fireplace? Check. All the sexy stu, like municipal sewage, water and road maintenance? (Oh, baby.) The only thing on which they really compromised was loca- tion. Purchased in November 2018, their new place is farther away than where they were rst looking. About 4,500 k ilometres farther, actually. You can't drive there, not easily. But really, taking a ¥ight from Vancouver to Toronto's Pearson International Airport, coupled with a two-hour drive to Ontario's cottage country, is only marginally longer than the Vancouver-Tono commute. They plan on going as often as they can. Weekends are out. ACTIVITY CENTRE KAMLOOPS POPULATION: 90,280 (2016 census) POPULATION DENSITY PER SQ. KM: 301.7 PRIVATE DWELLINGS: 39,081 (occupied by usual residents: 36,814) CLOSEST HOSPITAL: Royal Inland Hospital CLOSEST INTERNATIONAL AIRPORT: Kelowna International COMMUTING TIME FROM DOWNTOWN VANCOUVER: 4 hours AVERAGE ASSESSED VALUE 2018, SINGLE FAMILY RESIDENTIAL: $397,550 AVERAGE ASSESSED VALUE 2019, SINGLE FAMILY RESIDENTIAL: $431,000 (+8%) WHAT $500,000 WOULD GET YOU THIS SPRING: New three-bedroom, 1,679-square-foot duplex with lake and golf course views BUY HERE IF… You're the sporty type. There are lots of lakes for fishing and boating, hills and trails for horseback riding, hiking and bik- ing, and the Sun Peaks ski resort nearby R E C R E A T I O N A L P R O P E R T Y G U I D E

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