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February 5, 2014 – February 12, 2014 #04

“Education is when you read the fine print. Experience is what you get if you don’t.” -Pete Seeger

  • Six States For Retirees To Avoid
  • The Numbers, The Numbers – Vancouver
  • Retire On Or Near Water In Powell River Under $220,000
  • Strata Fees And Depreciation Reports
  • Good Time To Rent Office Space: Investors Not So Much
  • Trade Your Beater For A Condo Downpayment
  • Mortgage Rates Have Come Back Down
  • Western Investor
  • Best Mortgage Rates This Week

LAND RUSH

MOST OF YOU – DEAR SUBSCRIBERS, DEPENDING ON YOUR PACKAGE – ARE FREE TO ATTEND THIS EVENT … BUT PLEASE BOOK ONLINE ASAP OR CALL OFFICE AT
604-683-1111 TO GUARANTEE YOUR SPOT!

The 22nd annual JUROCK REAL ESTATE INSIDER Land Rush Conference at the Marriott Hotel in downtown
Vancouver will be jumping during the all-day event that has sold out every year since day one.

There is a fresh lineup of sparkling speakers and sponsors who will tell of the EXCITING opportunities available right
now in the Canadian and U.S. real estate markets.

The INCREDIBLE lineup of Speakers includes:

USA:
LAS VEGAS

MANNY CORDOVA: President and CEO, CanAm Property Management, LLC. A top-notch property manager with an eye for real estate investments as well we welcome Las Vegas
Lawyer JUSTIN ZARCONE.

USA: PHOENIX:

LINDA GERCHICK: CCIM Ace Realtor from Phoenix is back. Her predictions from the last 3 years made her investors a ton of money. Hear about her exciting new deals.

RYAN KOHL:
Express Capital Mortgage Inc.
Awarded by National Mortgage Professional Magazine in the “Top 40 under 40” most influential mortgage professionals, Kohl specialize in guiding Canadian
investors into the U.S. real estate market.

PLUS:

US Tax and Accounting Ace BRYANT ANDRUS from KEATS CONNELLY

CANADA:
OZZIE JUROCK’S

all encompassing (YOU MUST KNOW)
2014 Real Estate Forecasts
– Global, Canada and USA – best cities, best suburbs, best products … and what you MUST NOT buy!

PLUS:

Real Estate investment ace
RALPH CASE:
(Real Estate Action Group)
… the 7 essential steps to tie up that moneymaking deal with confidence.

PLUS:

JAKE FRY:

Smallworks Studios and Laneway Housing Inc.
Find out how you can add 20% value to your existing home!

PLUS:

The fantastic NORTH is once again ably represented by DAVE STEELE (Western Canadian Properties
Group)

PLUS:

Financing Ace KYLE GREEN (Mortgage Alliance) tells it like it is for investors and where to get
the best rates in 2014.

PLUS:

CYNTHIA AASEN, ANDREW SCHULHOF
Strategic Investment Realty.

“Retire rich when you want, do what you want, whenever you want! Get lifelong, monthly income that keeps pace with inflation and never worry about
running out of money.”

PLUS:

Heard of 3-D printing? Spend time with
TINKERINE
and see the printer in action!

PLUS:

Want a brand-new
CONDO FOR ONLY $129,000
in the FRASER VALLEY? Builder pays all expenses for 2 years! ALL!

Want to buy a condo in Vancouver and use your used car as a down payment?

PLUS:
Want an older 2-bedroom condo – also in the VALLEY and a half a dozen more under $100,000.

PLUS: CASHFLOW GALORE in BC!

BUY A SKI CONDO FOR $58,000
–
Fully furnished … rented year round at $650.
CASH-FLOW
! As well as 100 properties for sale under $100,000 and cash-flowing.

PLUS:

Ace Realtor
BRENT ROBERTS
with 12 hot deals from the Fraser Valley,

Ace Realtors
FION YOUNG
and
MARC JUROCK

from Richmond (Condos from $159,000)

Join hundreds of like-minded real estate investors at Land Rush 2014.

For tickets, call today to 683-1111 or visit www.landrushcanada.com

ALL DAY FEB. 15 AT THE MARRIOTT HOTEL, VANCOUVER

INTERNATIONAL: Six States For Retirees To Avoid

A report in Marketwatch (www.marketwatch.com) picks the U.S. states that are least income-tax
friendly for retirees, if the bulk of retirement income comes from U.S. government pensions, and should likely be avoided by snowbirds seeking low-tax
destinations. These are Nebraska, North Dakota, Rhode Island, Vermont and West Virginia, most of which fortunately wouldn’t jump to most people’s minds as
a retirement Mecca.

Regardless of your source of income, you probably don’t want to move to a state that taxes all your retirement income. These include: Arizona, California,
Connecticut, District of Columbia, Idaho, Indiana, Kansas, Massachusetts, Minnesota, Nebraska, North Dakota, Rhode Island, Vermont, West Virginia, and
North Carolina (beginning with the 2014 tax year.)

States that tend not to tax retirement income have to generate revenue somehow. And more often than not, that revenue comes in the form of other taxes such
as property and sales. New Hampshire, for example, has no personal income tax but property taxes in the live-free-or-die state, as a
percent of property values, are the third highest in the country. So while, you might fancy moving to a place that doesn’t tax your retirement income, do
consider what you might pay – gross and net after taxes – in property taxes.

There are at least 16 states where residents pay in property taxes 1.2% or greater of their home’s value. Those include Texas, New Jersey, Nebraska,
Wisconsin, New Hampshire, Illinois, Vermont, Connecticut, Michigan, North Dakota, Pennsylvania, Ohio, Kansas, South Dakota, Iowa, and Rhode Island

Of course, like politics, all property taxes are local. So, before you include or exclude this or that state, check out the property taxes in the
municipality you have designs on moving to and check whether there might be any exemptions and the like for retirees.

For some, it might make sense to move to a low-income tax, high-property-tax state. But all costs should e considered. The report’s author notes, “I have
friends who moved to Nevada but now say they are paying $300 a month for air conditioning. It behooves you, especially when you are retiring – you’re
living on limited income. It can have a very strong impact if you haven’t thought through all the consequences.”

When it comes to deciding what state to retire too, you ought to get a sense of the overall tax burden you’ll face. For instance, Connecticut has the
highest per capita state and local tax burden in the nation, at $6,984, while Mississippi has the lowest per capital state and local tax burden, at $2,625.

CANADA: The Numbers, The Numbers – Vancouver

The Real Estate Board of Greater Vancouver (REBGV) reports 1,760 sales in January 2014. This represents a 30 per cent increase compared to the 1,351 sales
recorded in January 2013, and a 10 per cent decline compared to the 1,953 sales in December 2013.

Last month’s sales were 7.2 per cent above the 10-year sales average
for the month.

“The Greater Vancouver housing market has been in a balanced market for nearly a year. This has meant steady home sale and listing activity accompanied by
stable home prices,” Sandra Wyant, REBGV president said.

Last month’s new listing count was 17.7 per cent higher than the region’s 10-year new listing average for the month.

The total number of properties currently listed is 12,602, a 4.9 per cent decline compared to January 2013.

“If you’re looking to sell your home in a balanced market, it’s critical that your list price is reflective of current market conditions,” Wyant
said.

Major Point:
Looking at the start of the year for the last 4 years, we are lagging still behind the sales performance January 2010 but have seen substantial increases
in the average price overall and the single family home price. Condos are about even with the price achieved 4 years ago. Clearly a much better start to
the year. We also hear from realtor that early February in Vancouver is clocking in strong. Sales centres are busier and people are braving the cold to see
open houses. A good start!

Retire On Or Near Water In Powell River Under $220,000

As of December, the average house price in lovely Powell River on the northern Sunshine Coast was down 25% from five
years ago. The average house price in Greater Vancouver went up 15% in the same period. So, in consideration of all our friends who are nearing retirement,
we looked at four Powell River properties either on the water or with an ocean view (or a private lot) that one could retire to. Remember Powell River is
no poor backwater: it has a great regional hospital and community fitness centre, outstanding lakes and some of the best ocean boating and fishing in
Canada, plus Walmart and most other brand name retailers. And a new brewery!

Major Point:
There are many others but here are our picks for freehold, detached houses in Powell River for under $220,000 (there are many more).

Listing ID: 10784. Price $199,000: 2-bedroom ocean view house on 3 lots with commercial lots right on the main street, right across from Willingdon Beach House rents for $675, but you
could live in it and rent out the 2 storefronts.

Listing ID10842 Price $142,900:
Sweeping ocean view. 2 bedroom updated rancher with new deck, attached two-bay garage and RV parking on ¼ acre lot.

Listing ID 10577. Price $134,000: 2 bedroom house backs onto the forest. Rec room downstairs and a detached 18×24 shop.

Listing ID 10759 Price $219,000 (offers accepted).
Lakefront cabin on Powell Lake, accessible by boat from marina in 10 minutes. 686 sq. ft.with 2 bedroom loft and sunny west outlook.

Strata Fees And Depreciation Reports

The B.C. government has brought forward legislation – effective in December last year – that allows strata corporations to demand strata owners pay for
certain repairs, if a majority of strata members agree. Under the amendment to the Strata Act, the court can issue an order to proceed with critical
repairs necessary “to ensure safety and prevent significant loss or damage”, if the strata owners have passed a resolution endorsing a special levy.

“Every strata corporation has to file a depreciation report that includes a 30-year budget for repair, upgrades and maintenance,” explains Frank Schliewinsky, co-publisher of the Vancouver Condo Report.

The budget for such repairs comes from the monthly strata fees that each condominium owner must pay. Any condo owner should check if their current strata
payments. Too low and you could be stuck with catch-up repair costs; too high and you may be paying a lot more each month than you should be. Prospective
buyers also need to examine major variations from average strata fees or else they could find themselves paying a lot more than expected.

Major Point:
According to Vancouver Condo Report research, average strata fees for a high-rise building six to 10 years old in Metro Vancouver range
from a low of $0.27 per square foot in the Tri-Cities to from $0.43 to $0.44 per square foot in downtown Vancouver and North Vancouver. (This would equate
to from $270 to $440 per month for a 1,000-square-foot condominium.)

Strata fees for low-rise buildings are generally in the .23 cents to .32 cents, with rates for older buildings from 30% to 40% higher than for new
buildings.

Good Time To Rent Office Space: Investors Not So Much

If you are looking for new office space in any of the three major Western Canadian cities, now may be good time to negotiating on leases. Vancouver, Calgary and Edmonton are all in the midst of a regular cycle in the office sector where supply is outstripping demand. You
could score some prime space now and attractive lease rates. This includes sublease space that is mushrooming in all three markets.

Vancouver: With seven new downtown towers under construction – a total of 1.8 million square feet to be complete by the end of next year – and about 800,000 square
feet of sublease space on the market, Vancouver’s vacancy rate appears headed for double-digits for the first time in a decade. DTZ is
forecasting 12.5% vacancy downtown by late in 2015, up from 5.6% today.

It is even worse in the suburbs. Surrey already has a 27% office vacancy rate; Burnaby is close to 10% and Richmond is sitting with 17% of its Class A space dark. Asking lease rates are sitting stubborn at around $24.50 downtown and $20 for
Class A suburban space, but there are all kinds of incentives being offered. There are some sweet lease deals on sublease space, but this comes with
catches, such as short-term leases and tenant costs for changes to the space. The overbuilt situation in Vancouver is partly fueled by a bonus density deal
from the city that was meant to encourage new “work space” downtown. The most recent tower to break ground, the Exchange, for instance, received a floor-space-ratio of 21.5, rather than the 9FSR it was originally zoned for.

Edmonton: The downtown office vacancy rate, now at 8%, is trending higher and could really take off if the City of Edmonton proceeds with plans for a
450,000-square-foot tower. The city plans to move its entire staff from sites across downtown into their own space. This would leave 300,000 square feet of
space in a city where there is already negative leasing of existing offices. A clue to what is happening: the 16-storey ATB tower downtown is completely
vacant and 30% of the most recent high-rise – the Epcor tower – is still empty three years after it was built. Lease rates for prime
downtown office space have slipped to around $24 psf – the same as five years ago.

Calgary:
We share confidence in the Calgary market, but the office sector represents a stretch. The downtown office vacancy rate has doubled in the past year to 9.1
per cent as a ton of sublease space – 1 million square feet – has come back on the market. The percentage of sublet space in the overall vacant space is
now at 46.2%. The Class A net rent is now $36.76 per square foot, down from $40.58 in 2012. Expect it to go lower: there is 4.7 million square feet of new
office space under construction in downtown Calgary.

Trade Your Beater For A Condo Downpayment

A ‘car for condo’ downpayment promotion has proved a hit for a Vancouver developer. In Gastown, a 61-unit concrete condo building being
developed on East Cordova Street, has been accepting used cars towards the down payment since mid-January.

The marketing idea, dreamed up by Cam Good of Key Marketing Ltd., has proved a hit.

“We closed six deals in the 10 days following the launch. This compares with 30 deals in the previous five months,” Good said.

The mostly young buyers “seem more interested in their iPhone than their car,” he said.

The promotion runs to the end of February. Under the plan, a buyer lacking a down payment can bring in their used car, which is then appraised. The
assessed value can then be applied directly towards a down payment. For example, if the car is valued at $5,400, the buyer could qualify for an initial 2%
down payment on a $269,800 one-bedroom condo at in Gastown.

Buyers would still need to make monthly payments of $512 per month for up to 16 months as the condo development is being built to make up the minimum 5%
down payment required for mortgage financing. However, if the used car is worth $13,500, it would cover the 5% down payment with no monthly costs to
completion, Good explained. The use of incentives to sell new condos has tailed off in recent month as the market has improved, said Good, whose company
markets a number of new condominium projects.

Major Point:
Still haggle hard. A survey of new condo developments in Vancouver and the Fraser Valley found fewer but sill plenty buyer incentives. Offers of $20,000
off, or $1,000 a month for 36 months abound. There are also expenses paid packages available in the Fraser Valley.

Sales of condominium apartments reached 753 units in January, up 30.7% from January 2013, reports the Real Estate Board of Greater Vancouver.

Mortgage Rates Have Come Back Down

Remember two years ago when a 2.99% five-year mortgage rate spooked the federal finance minister and some say led to a fresh round of mortgage tightening?
Well that rate came back this week, backed by Industrial Alliance (www.inalco.com) with a mortgage rate good for
60 days, but otherwise a normal product in terms of pre-payment and penalties.

The low-ball rate apparently encouraged major banks, which also cut long-term, rates. Scotia Bank is offering five-years at 3.49% and mortgage brokers have
even lower 5-year rates.

Today, variable rates sit at around 2.55% and five-year but the difference from last year is that most don’t expect interest rates to rise until next year
or maybe later. This means we could be paying 2.55% or less for the next 1 to 2 years … maybe longer. So variable is a definite consideration when
choosing your mortgage today.

Whither rates? Who really knows? To protect yourself, get pre-approved at today’s rates for as long as possible.

BEST MORTGAGE RATES THIS WEEK:

2.99% rates coming back?

Will we be seeing 2.99% 5 year fixed rates again soon? Kyle Green (778-373-5441, kgreen@mortgagealliance.com) seems to think there is a good possibility.

“With the Dow Jones down about 7% so far year to date and bonds falling with consumer confidence, fixed rates have been dropping quickly. Bonds are down
about .35% since Jan 1st 2014, and fixed rates have fallen nearly as much. Variable rate discounting has also improved with many lenders now
offering Prime -.5% (2.5%) as their standard 5 year variable rate term,” says Kyle.

Generally lenders price their 5 year fixed rates at bond yields (currently 1.59% as of Feb 5th) plus 1.5% – 1.9%. This currently represents a
range of 3.09% – 3.49%. “Major banks will be hesitant to come down to 3.09% until the markets have settled and stay low for at least a week, but we’re
already seeing lenders jumping to 3.19% and 3.09% in rare cases,” says Kyle. “We often see lenders err towards the lower end of the spread in spring time
as they try to gain market share. Unless the US Fed’s tapering has a significant impact on bond yields (and therefore fixed rates) we may see 2.99% 5 year
terms come back soon.

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