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JANUARY 11 TO 13, 2013 | BMO CENTRE | STAMPEDE PARK | 3

Property dreams come true

Sand beneath your toes; beautiful lake or sea water within

grasp; hot weather and golf courses galore; stunning vistas and architecture.What is not to like about that dream so many of us have of a recreation and

investment property?Well, dreams can become reality as

buyers get the chance to explore pos-sibilities and options at the Calgary Her-ald’s sixth annual Recreation & Invest-ment Properties Show at Stampede Park.

Our show, done in conjunction with HomExpo that draws about 20,000 people each year, is a natural extension of the Calgary Herald’s leadership role in providing our readers with extensive coverage of the recreation and invest-ment property market in Western Can-ada and around the world.

The Calgary Herald’s sixth annual show gives consumers the opportunity

to talk face to face with developers, builders or their representatives on myriad of investment options — from projects here in Canada to ones in mul-tiple locations around the globe.

It’s a chance to do your homework so you get the property that works for you and your lifestyle — whether you are a boomer looking for that perfect retirement prop-erty, or a young family looking for a place to enjoy on weekends or holidays.

Buying a second property is a big de-cision. Our magazine gives you tips on what to look for, what issues you need to consider, and how to make sure the deci-sion you make is the right one for you.

Heading into our 2013 exhibit, we are excited to welcome you to the event. We will see you there.

Barb LivingstoneSpecial Projects Manager

Editor New Homes, New Condos and

Recreation and Investment Properties

weekly sections,Calgary Herald

BARB LIVINGSTONE

contentsDREAM HOME IN THE SUN 4From lakeside lots in Alberta to poolside in Arizona, a rec-reation property is waiting to be discovered at the Calgary Herald Recreation & Investment Properties Show.

SEARCH EASY 5Technology has made finding the best recreation prop-erty easier than ever. Most recently The Canadian Real Estate Association unveiled a smart phone application.

PRIZE GETAWAYS 6This year you can enter to win one of two great vacation getaways to Bellstar Hotels and Resorts and La Bella Vita Resort and Spa.

TAXING MATTERS 8If you’re buying U.S. property, you won’t want to miss featured speaker Alanna Caplan’s presentation on the tax implications of purchasing property in the States.

MAP & EXHIBITORS 12-13A full list of exhibitors and a handy floor plan to help you locate them at Calgary Herald Recreation & Investment Properties Show.

THE RIGHT FIT 14There’s a recreation property out there that’s right for you. Discover the many possibilities.

MONEY MATTERS 16A look at your options for financing if you don’t have the funds to pay for a vacation home outright. BUYING TIME 18When it comes to buying real estate, timing is everything.

RECREATION & INVESTMENT PROPERTIES SHOW

JANUARY 11-13, 2013 BMO Centre, Stampede Park

SHOW HOURSFriday, Jan. 11, Noon – 9 p.m.

Saturday, Jan. 12, 10 a.m. – 8 p.m.Sunday, Jan. 13, 10 a.m. – 5 p.m.

Stay™

or Own™ | ownsolararesort.com ownspiritridge.com

owncanyondesert.com ownkokaneesprings.com

Bellstar’s various resort and residential developments arelocated in Western Canada’s most desirable recreationaldestinations, a visit can be very tempting!

BellstarRealty.com [email protected]

Bellstar is passionate about delivering authentic resort and recreational ownershipexperiences that are woven from the fabric of each unique destination and embrace thevalues of the community in which we develop. Our commitment is to service and valuewith a desire for helping our owners experience and connect with the destination.

*Visit the Bellstar booth with this ad & receive a

$100 Bellstar Gift Voucher* Register at the Bellstar booth at the Calgary Herald Recreation &Investment Properties Show with this ad, to receive your gift voucher.

Daily prizes and giveaways at the booth during the show!

There’s never been a bet-ter time than now to buy a vacation home or investment

property, and the easiest way to begin the process is by attending the 2013 Calgary Herald Recreation & Investment Properties Show — part of Calgary HomExpo 2013, running Jan. 11 to 13.

Calgary’s premier event devoted to recreation real estate, the show is back for its sixth year as a featured component of HomExpo, Western Canada’s largest home, renovation and décor event.

Sponsored by the Canadian Home Builders’ Association – Calgary Region, HomExpo brings together more than 200 exhibitors and 200,000 square feet of displays in the BMO Centre at Stampede Park.

HomExpo show producer Rick Young says last year’s event saw a

boost of interest by consumers with people arriving to get into the show as soon as it opened.

Young says as the first consumer home show of the year, there is usually a pent-up demand of people wanting to find out about the latest home products, services and also the opportunities for recreation and investment property.

He says the event is all about discovery, and the chance to talk face-to-face with experts in the field and also those people behind the various new developments.

“You get people who are genuinely interested in coming to the show for that type of conversation.”

Young says for anyone looking for a future retirement home, recreation property, or just a place to get away and relax for vacations, the Calgary Herald Recreation & Investment

Properties Show is a good place to start.

He says people can speed a couple of hours talking to developers and gathering information all in one con-venient location.

Then they can take the various bro-chures and other information home to contemplate before taking the next step.

Even the timing of the show is ideal, as winter has many people dreaming of warmer climates.

With the Canadian dollar hovering at par with its U.S. counterpart, Young says now is definitely a good time to invest.

The HomExpo’s presentation stages are also an excellent resource for people attending the show, and can provide useful information of a vari-ety of topics, including ones related to recreation property.

In previous years presentations have included financing property, buying outside Canada, and other areas of interest.

Featured speakers at HomExpo this year include Hilary Farr, who has gathered a large following with her hit TV show Love It or List It.

Farr will focus on interior design, including dos and don’ts, with an emphasis on how to personalize your own projects.

Back for another HomExpo is John Sillaots, former host of HGTV’s In the Workshop and the owner of his own cabinet manufac-turing company.

Sillaots works closely with his wife, and his presentations often include a humorous insight into the differences between men and women when it comes to renovation projects.

4 | CALGARY HERALD RECREATION & INVESTMENT PROPERTIES SHOW 2013

Find your vacation home at 2013 HomExpo — Thinkstock photo

Winter has many people dreaming of warmer climates. With the Canadian dollar hovering at par with its U.S. counterpart, now is definitely a good time to invest.

JANUARY 11 TO 13, 2012 | BMO CENTRE | STAMPEDE PARK | 5

HOMEXPO

Show Dates: January 11 to 13, 2013 Show Hours: Friday: Noon to 9 p.m. Saturday: 10 a.m. to 8 p.m.Sunday: 10 a.m. to 5 p.m. Show Venue: BMO Centre, Stampede Park Years Running: 41st annual Theme of Show: The largest building, renovation and décor show in Western Canada Number of Exhibitors: 200+ Attendance: 18,000+ Gross Square footage: 200,000 Sponsor: Canadian Home Builders’ Association – Cal-gary Region Admission: Adults: $12; Seniors/Student: $10; Children 12 and under: free

You’ve decided the time is right to purchase a recreation property.

So what’s the first step: Contact a realtor?

While a realtor may eventually play a valu-able role in helping you purchase a property, it’s a good idea to do some advance research to help you find potential properties, and learn how purchasing a recreation property can differ from buying a home in the city.

The Internet has made researching recre-ation property much easier.

An excellent resource is the realtor-owned Multiple Listing System (www.realtor.ca), which provides basic listings of real estate for sale.

The Canadian Real Estate Association has also recently unveiled smartphone applica-tions that provide much of the functionality of realtor.ca, along with new features that take advantage of the built-in GPS system in most smartphones.

For instance, if you are visiting an area, you can select Properties Near Me in the applica-tion for a list of real estate for sale nearby.

There is also an option to view new listings and open houses near your current location, or look up a specific MLS listing number — if you see one on a for sale sign.

Selecting an individual listing in the appli-cation also brings up photos and links to the listing realtor’s website, including the option to send the realtor an email or phone them from your cellphone.

The application is available for smart-phones including the Apple iPhone, Black-berry, Windows 7 phones, with a version coming soon for Android phones.

Knowing what the real estate market is like in an area can also be a useful negotiating tool. Both the Alberta Real Estate Asso-ciation (www.areahub.ca) and the British Columbia Real Estate Association (www.bcrea.bc.ca) publish MLS statistics for their respective provinces. Also useful are links to the many individual real estate boards throughout each province, with many of those releasing their own monthly sales and prices statistics.

Several books have been published with

information and advice for both buyers and sellers.

Author and former lawyer Douglas Gray’s book The Complete Guide to Buying and Owning a Recreation Property in Canada (Wiley) focuses on the due diligence that is crucial when buying a property for personal use or investment.

Vancouver realtor Geraldine Santiago has written Buy & Sell Recreation Property in Canada (Self-Counsel Press), designed to help you get the best deal when buying a prop-erty, or assist you in selling your recreation property.

Author and entrepreneur Philip McKer-nan’s book South of 49 — The Canadian Guide to Buying Residential Real Estate in the United States (Wiley) uses a storytelling approach to highlight the process of purchas-ing property in the U.S. and how to avoid any pitfalls.

Many of the books are also available in e-book format through popular online webstores, for downloading on to digital devices.

Technology makes property searching a breeze

— Thinkstock photo

The Canadian Real Estate Association of-fers smartphone applications for home searches.

6 | CALGARY HERALD RECREATION & INVESTMENT PROPERTIES SHOW 2013 JANUARY 11 TO 13, 2013 | BMO CENTRE | STAMPEDE PARK | 7

Buying real estate in the United States involves terminology not often heard in the Canadian market – or similar terms

with different meanings. Here are a few terms you might encounter, depending on the type of purchasing or investing you pursue. n Foreclosure, bank-owned, and REO (real

estate owned) all mean the same thing in the U.S. This means a “trustee sale” has occurred

and ownership of the house now rests with a lender or bank.n Pre-foreclosure is triggered when the

owner of a property defaults on payments and has received a “notice of default.” n Short sale. The homeowner still owns

the home, but a home they paid, for example, $400,000 for might now be worth only $200,000, and with foreclosure looming they need to sell it,

selling short of what they owe. When a prospec-tive buyer puts in an offer, that offer has to be justified to the satisfaction of the bank.n BPO (Broker Price Opinion). A com-

parative market analysis to tell the bank what the realtor thinks the home’s market value is, versus appraised value.n Single-family home, single-level. You’ll

usually hear these terms instead of “bungalow.”

n Homeowner association. U.S. equivalent of condo associations, or stratas. A body overseeing a property that collects a fee from residents/tenants.n Earnest money. A deposit applied

towards a purchase, covering funds to start a transaction. Also called an earnest deposit.n Escrow in the U.S. uses title company

closings, as opposed to attorney closings. A title company is a (neutral) third party.

You say to-may-to, I say to-mah-to … definitions demystified

The 2013 Calgary Herald Recreation & Investment Properties Show at HomExpo is a great resource for any-

one considering the purchase of a recreation property.

In addition, you could also win a vacation prize from Bellstar Hotels & Resorts or La Bella Vita Resorts just by attending the show and filling out a contest entry form.

La Bella Vita Resorts is providing five nights of accommodation at its Canmore property, the Inn of the Rockies, along with some extras to make the trip even more memorable.

The winner will enjoy a “suite” stay at the gateway to Banff National Park, with the chance to unwind in the outdoor hot tub, play in the pool and relax in a two-bedroom getaway at the foot of the Rockies.

People attending the show can also find out more about the company’s world class fishing resort hotel and private lodges in Bamfield,

B.C., in the heart of Vancouver Island’s Pa-cific Rim; and also the fabulous La Bella Vita Resort and Spa in Mexico, a gated beachfront resort community overlooking the Sea of Cortez.

La Bella Vita Resort and Spa has a wide range of real estate available including vil-las, bungalow apartments, and single-family homes.

Resort amenities include tennis courts, spa and health club, and a beachside pool.

Ownership options include full ownership starting from $159,900, or fractional owner-ship from only $59,900. Daily and weekly vacation rentals are also available.

For more information, go to la-bellavita.com or phone 403-288-3777.

The prize being offered by Bellstar Hotels & Resorts is a four-night stay at Kokanee Springs Resort Club in Crawford Bay, B.C., a magnificent new mountain community taking shape at the scenic Kokanee Springs golf course.

Real estate sales are now underway at Kokanee Springs Resort Club with villas and cottages available.

People attending the show can learn more

about all of Bellstar’s current resort real estate offerings.

Solara Resort & Spa in Canmore has full or fractional ownership with amenities that in-clude the One Wellness spa and fitness centre, hot tubs and kids’ water park, cinema-seating theatre, and five-star hotel and concierge services.

The Residences at Spirit Ridge is the latest phase of real estate at Spirit Ridge Vineyard Resort & Spa, located in a vineyard with wa-terfront beach access to Osoyoos Lake, B.C.

Full or fractional ownership is available in the village residences, along with amenities that include outdoor pools areas.

Canyon Desert Resort in Oliver, B.C. is now offering single-family golf villas sur-rounded by the spectacular Nk’Mip Canyon Desert Golf Course.

For more information, visit ownkokan-eesprings.com, ownsolararesort.com ownspir-itridge.ca, or owncanyondesert.com.

2013

JANUARY 11 - 13, 2013BMO CENTRE, STAMPEDE PARK

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Friday Noon – 9 pm, Saturday 10 am – 8 pm, Sunday 10 am – 5 pmAdults $12, seniors and students $10, children 12 & under FREE

Both sponsors are present at the Calgary Herald Recreation & Investment Properties Show in HomExpo.

CANMORE, A.B.

CRAWFORD BAY, BC.

Five night suite stay from La Bella Vita Resorts at Inn of the Rockies in Canmore, AB, gateway to Banff National Park.

Four night villa vacation from Bellstar Hotels & Resorts at Kokanee Springs Resort in Crawford Bay, BC.

Win great vacation prizes at the rec property show Two great opportunities for getaways to Canmore and Crawford Bay, B.C.


Attend the Calgary Herald Recreation & Investment Properties Show and enter to win one of two vacation prizes in Canmore and Crawford Bay, B.C.

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Know your tax obligations when investing in U.S.

ALANNA CAPLAN CGA, CPA (U.S.) is a

featured speaker at the Calgary Herald

Recreation & Investment Properties Show

Jan. 11-13Hear her at the main stage

area, Hall A Presentation Area

Friday, Jan. 11: 3:30 p.m.Saturday, Jan. 12: 4 p.m.Sunday, Jan. 13: 2 p.m.

*speaking times subject to change

As the U.S. housing foreclosure crisis continues, Canadians continue to aggressively invest in U.S. real property. With the Canadian dollar hovering near par, it gives Canadian investors exceptional buying power in the U.S. Canadian investors consider this to be one of the most op-portune wealth transfers of recent times. U.S. tax authorities have continued their focus on foreign investments in the U.S. This increased focus has exposed many Canadian investors to tax compliance issues and has resulted in substantial, unrecoverable financial penalties and interest being assessed.Tax implications have not generally been part of the planning process for many investors and for some, the often misunderstood and late filed tax

compliance has resulted in substantial penalties. It is important for Canadians investing in U.S. real property to understand the tax implications and their tax reporting obligations.

Buying U.S. Real Prop-erty: Foreign Investment in Real Property Tax Act (FIRPTA)

The Foreign Investment in Real Property Tax Act (FIRPTA) authorizes the United States to tax foreign persons on dispositions of U.S. real property interests. A with-holding tax obligation is gener-ally imposed on the buyer or withholding agent when a U.S. real property interest is acquired from a foreign per-son. If the required amount is not withheld and the required forms are not submitted to the U.S. tax authorities in a timely manner, the buyer may be subject to substantial penalties.

It is very important for buyers to establish whether they are acquiring a U.S. real property interest from a foreign person. Note: A Cana-dian resident who is not a U.S. citizen would be

considered a foreign person for purposes of FIRPTA. With the growing number of Canadian investors in the U.S., more and more buyers of U.S. real property interests will be subject to FIRPTA withholding and reporting requirements.

Ownership StructureThere are many forms of

ownership for investment in U.S. real property, and many factors to consider when determining which structure to use. There are certain forms of ownership which are generally not recommended for Cana-

dian residents due to high effective tax rates or tax treaty restrictions. The optimal ownership structure

for an investment in U.S. real property will vary based on the investor’s facts and circumstances. In addition to other planning considerations, inves-tors should understand the U.S. and Canadian tax implications of their respective form of ownership to ensure proper compliance and that their invest-ments are structured in alignment with their goals.

U.S. Estate or Gift TaxUpon acquisition of U.S. real estate or other

U.S. investments, a U.S. Estate Tax or Gift Tax implication and filing requirement may eventu-ally arise. There are tax planning structures which are aimed at avoiding and, or minimizing the U.S. Estate Tax, however these structures can be complex in nature and require specialized planning and administration. It is recommended that investors understand the U.S. Estate tax implications when investing in U.S. property.

With the passing of the U.S. Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, the highest U.S. estate tax rate for 2010, 2011 and 2012 was 35 per cent, accompanied by an exemption of $5 million. On January 1, 2013, unless further

legislation is enacted, the estate tax exemption amount will be reduced to $1 million U.S., with a top estate tax rate of 55 per cent.

Canadians, other than U.S. citizens, will only be subject to U.S. Estate tax on their U.S. situs prop-erty. Under the Canada-U.S. tax treaty, the unified credit is available to residents of Canada and is prorated based on the ratio of U.S. assets to the to-tal worldwide estate. A marital credit may also be available. The exemption allows an estate to claim for a unified credit, which could result in no U.S. estate tax payable if the decedent’s total worldwide estate is less than the exemption amount.

Spending Time in the U.S.Under the U.S. Substantial Presence Test,

Canadians who winter in the U.S. may invol-untarily become U.S. tax residents if they are determined to have substantial presence in the U.S. An individual who is classified as a resident of the U.S. under the U.S. resident rules, in addition to other possible implications and reporting requirements, is subject to U.S. income tax on their worldwide income.

Renting or Selling U.S. Real Property – Income Tax

Rental income from real property located in the U.S. and the gain from its sale will be considered

U.S. sourced income subject to tax in the U.S. re-gardless of the foreign investor's personal tax status and regardless of whether the U.S. has an income tax treaty with the foreign investor's home country.

U.S. Federal and Canadian Income tax When a Canadian resident sells a U.S. real

property, the Canadian is required to file a U.S. federal income tax return to report the sale. They are also required to report the sale in their Canadian income tax return. The income would be subject to tax in both the U.S. and Canada.

If the U.S. property is used to generate rental income, and the Canadian elects to pay tax on the net income rather than the gross income, the Canadian is required to file a U.S. Federal income tax return to report the rent. There is also a report-ing requirement in Canada and the income would be subject to tax in both the U.S. and Canada.

When a Canadian resident rents or sells an investment in U.S. real property, there are U.S. and Canadian tax implications and filing requirements. If properly planned and admin-istered, the Canada – U.S. tax treaty may apply, thereby avoiding double taxation.

U.S. StatesThe U.S. states are independent from one

another in their taxing authority. Depending

on which of the U.S. states the investment in real property is made, the reporting and filing requirements may vary. In recent years, the state tax authorities have stepped up their tax compliance audits and have started assessing penalties against those who are not compliant. Withholding Tax

Generally, an individual is subject to U.S. tax on U.S. source income. Most types of U.S. source income received by a Canadian resident are subject to U.S. withholding tax of 30 per cent. Pursuant to the Canada – U.S. tax treaty, a reduced rate may apply. The 30 per cent tax is generally withheld from the payment made to the Canadian resident unless a tax treaty based reduction of withholding application has been provided to the withholding agent.

The Foreign Investment in Real Property Tax Act (FIRPTA) authorizes the United States to tax foreign persons on dispositions of U.S. real property interests. A withholding tax obligation is generally imposed on the buyer or withhold-ing agent when a U.S. real property interest is acquired from a foreign person.

Other Reporting RequirementsIn addition to reporting the income from a

U.S. real property investment, there are other

various reporting requirements that may apply. For example, the U.S. Department of Com-merce is authorized to collect information on foreign investment in the U.S., including investments in U.S. real estate. Disclosure of ownership in foreign property is also required by the Canada Revenue Agency. It is important to stay abreast of the rapidly changing U.S. tax legislation, as failure to report the required information may result in significant penalties.

Ultimately, it is the responsibility of Cana-dian and other foreign individuals to understand the U.S. and Canadian reporting requirements when investing in, doing business in, or having a substantial presence in the U.S. Investors should periodically review their tax planning and compli-ance with respect to their U.S. investment due to the rapidly changing U.S. tax legislation which is affecting a growing number of Canadian residents.

Alanna Caplan CGA, CPA (CO, USA) provides U.S. and Canadian cross-border tax planning and compliance services. Ms. Caplan is authorized by the U.S. Internal Revenue Service (IRS) to provide certifying acceptance agent services on behalf of Canadian, and other foreign individuals. Contact Ms. Caplan at 403-237-8586 or [email protected] or visit www.taxinternational.ca.

To ensure compliance with U.S. Treasury Department Regulations, we wish to inform you that any tax advice that may be contained in this communication is not intended or written to be used, and cannot be used, for the purpose of: (i) avoiding tax-related penalties under the Internal Revenue Code, (ii) applicable state or local tax law provi-sions, or (iii) promoting, marketing or recommending to another party any tax-related matters addressed herein.

CGACPA (U.S.)

ALANNA CAPLAN

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The purchase of a recreation prop-erty often begins with a vacation. So if you’re heading south of the

border this winter, here are some hot spots that may pique your interest in accommo-dations of a little more permanent nature.

From the classic Mayan Riviera vacay to the new destination of Panama, Calgar-ians will be fleeing the fluffy white stuff in droves this winter.

“I think this year, the Mayan Riviera is still the most popular destination in Mexico,” says Janette Forner, central operations manager for travel at AMA. “The beautiful white sand and blue, blue water. It’s really exactly what you imag-ine when you picture a beach vacation in the middle of winter.”

Travellers to the Mayan Riviera can ex-plore Mayan caves or villages or indulge in some snorkelling. The Mayan Riviera is home to the largest coral reef in the northern hemisphere and is also home to many, beautiful spas.

Forner says it’s also her favourite

“land” destination, although she is quite partial to cruises as well in the St. Lucia and Grand Cayman areas.

Travel south is still heaviest to Mexico and the Dominican Republic (DR).

Forner says Punta Cana in the DR is a close second to the Mayan Riviera. Punta Cana is on the east coast of the DR where more than 50 hotels and 30,000 hotel rooms are spread across 40 kilometres, and it has become a very popular destination for golf.

“Probably one the most notable changes this year is Hawaii as a very popular desti-nation,” says Forner. “It’s a great option for people who have done the Mexico thing as so many people have these days, and the (American) dollar is a great motivator. And it’s just an easier vacation in some ways — you don’t have to worry about the water or a language barrier.”

For those looking for adventure on their vacay, Forner says Panama is a re-ally great choice.

Panama features two distinct climates — the lowlands including Panama City

which are tropical and humid and the highlands which have spring-like tem-peratures year round. The diverse Panama Canal Rainforest is 30 minutes from Panama City, and the country features beautiful beaches along 1,600 kilometres on coast on both oceans and 1,500 islands. Forner says Costa Rica is a destination to consider for those who want to mix some beach time and some time adventuring.

“You can spend a week on a beautiful beach, and then spend a week hiking or kayaking in the rain forest,” she says. “If you just go and sit on the beach in Costa Rica, you miss such an important part of the country.”

She also says it is a great place to experience “five-star camping.”

For example, Costa Rica offers beauti-ful treehouse accommodations for the traveller looking for a stay that’s a little bit more exciting.

The beautiful country has also made a name for itself internationally as an eco-tourism destination.

Top vacation spots south of the border attract future buyers


The Mayan Riviera is one of most popular destinations in Mexico.


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There are many types of recreation proper-ties — each has their advantages and each appeal to a different kind of buyer.

Here is some advice from real estate experts on questions to ask when looking at the most popular types of recreation properties. Building lots or bare acreages

The idea of buying some land and building your own vacation home has plenty of appeal, but are you prepared for the reality?

Does the developer require you to use their chosen builder(s), or can you bring in an outside company? Are there architectural or other guide-lines such as minimum size, and do you have the budget to build such a home? Is there a building time commitment, such as starting construction within so many years, or a final date to finish construction?

RV resortsA popular way for people to enter the recreation

property market, RV resorts allow you to park a newer model RV or park model RV on a lot and construct a deck, patio covers and storage shed.

Before buying, find out what utilities are available, whether they run year round, and what is included in your “condo” fees that many RV

resorts use to cover community expenses. Also, does the resort have rule about pets, parties, guests, landscaping, boat parking and any other issues that might affect your enjoyment of your RV property? Are there resident amenities, such as beach, golf course, clubhouse and swimming pool? Some RV resorts give you the option of eventually replac-ing your towable RV with a constructed cottage, which can be a great way to move up in the market

without changing locations.

Resort condominiumsOften located at ski hills, on the waterfront, or

at golf courses, resort condominiums differ from a residential condominium by their amenities and available onsite rental programs.

When resort condo shopping, find out all costs associated with both purchase and ownership,

including condominium fees, property manage-ment fees, and a possible annual resort fees paid to cover a share of the overall resort amenities. If you buy part or fractional ownership, consider whether the monthly fees are in reasonable proportion to the amount of weeks you get to use your unit. Does the resort have two “legs” when it comes to seasonal attractions, such as skiing in the winter and golf in the summer? That will increase its marketability and resale potential.

Cabins, cottages and chaletsA fancier terms for a single-family home, these

types of recreation property can often resemble a home in the city, but there are plenty of differences to think about before choosing one.

Is the cabin located in an urban setting with modern utilities, or will you need to learn about the intricacies of wells, septic systems or propane deliveries? If it is a resale cabin, especially one that has been around for a while, get a land survey to ensure that the property boundaries are accurate.

Determine if the area has any specific zoning is-sues that may restrict your ability to build addition structures, have a fire pit, stable some horses, etc. Make use of an accredited home inspector, it could be the best $300 you spend in your quest to find the ideal recreation property.

Expert advice on buying the perfect recreation property


Each recreation property has its advantages and each appeals to a different kind of buyer.

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With some areas of Western Canada being a buyers’ market for recre-ation property, many are looking to

take advantage of the situation. But what are your options for financing if

you don’t have the funds to pay for a vacation home outright?

“It’s easier than ever to gain financing on a recreational property. There are more options than ever available from Canadian lenders and insurers,” says Kelly Robinson, mortgage specialist manager with RBC in Calgary.

Depending on the circumstances, you could finance the purchase of a recreational property with as little as a five per cent down payment, Robinson says.

You will need to meet the general lending requirements that take into account your Total Debt Service Ratio (TDSR).

Under financial industry guidelines your TDSR should not exceed approximately 40 per cent of your gross income. Your TDSR includes mortgage payments, property taxes, and utilities — on the property you intend to buy and your primary residence — plus any other consumer debts including credit cards,

car loans. Here’s are some options available for financing a recreation property/vacation home.

High Ratio Insured Mortgages To finance a recreational property using

less than a 20 per cent down payment, you will require a high ratio insured mortgage, Robin-son says. In general, to qualify for a high ratio mortgage for a recreation property, (5 per cent to 19 per cent down payment), a recreation property/vacation home needs to be accessible year round, and not seasonal in nature — such as a mountain cabin that is not accessible dur-ing the winter because of annual road closures. The building should be a permanent structure with a foundation, and have a permanent heat-ing source.

Robinson says the property should be occupied by the owners or their relatives. If you intend on collecting rent on this type of property, this may not qualify for a high ratio insured mortgage.

Conventional Mortgage A conventional mortgage allows you to

finance up to 80 per cent of the purchase price

of the vacation home, thus requiring a down payment of at least 20 per cent, Robinson says. If you plan on purchasing a property such as a seasonal cottage for summer (or winter) use only, a conventional mortgage may be the choice for you.

An important factor with both conventional and insured mortgages is lenders typically offer them when purchasing a recreational single-family home or condominium, and not for other property types such as timeshares, fractional ownership and life leases.

Home Equity Line of Credit Robinson says if you have equity in your

principal residence or even a second home, you can effectively borrow some of that equity, which gives you freedom to purchase almost any property type, such as a timeshare, a con-do that you plan to place in a rental pool when not using it, or a property outside Canada.

A home equity line of credit allows you borrow up to 80 per cent of the equity in your home — that is the value of the home less the debt still owing on it, as determined by an up-to-date appraisal.

Financing options make it possible to buy a place in the sun


A recreation property can be purchased for as little as a five per cent down payment, says mortgage specialist, Kelly Robinson.

Insuring a home or condominium that is your primary residence is fairly straightforward, but insuring a recre-

ation property can be a different matter. Where the property is located, how

often you will use it, and whether it will be rented out, are among the factors that may come into play in determining the type of insurance coverage you can buy and how much it will cost.

Frits Wortman, consumer informa-tion officer with Alberta and the North, Insurance Bureau of Canada, says your first stop should be the insurance com-pany that provides insurance for your primary residence.

Wortman says since you are already dealing with them you can have your vacation property listed on your home insurance as a “secondary” or “sea-sonal” location.

The greater difficulty in writing a policy for a vacation home, and the potentially greater risk, means that many companies will want to have the

business for your primary residence before agreeing to sell you insurance for a recreation property, he adds.

There is a major difference between insurance for a primary home and a vacation property, because of the added risk of the property only being occu-pied on a part-time basis. Rather than a comprehensive policy, vacation property insurance is offered as a named perils policy, meaning that you will have cover-age for specific risks, such as fire, explo-sion or smoke damage, Wortman says.

Coverage for additional risks, such as water damage may be more difficult or expensive to arrange, because you might not be there to take quick action if a water pipe bursts. You can also add coverage for burglary, riot, or glass, but again it might be expensive, because of the fact the property is un-occupied much of the time, he says.

Another thing to consider is that while a typical homeowner’s policy automatically includes an extension to cover out buildings such as garages

and sheds, up to perhaps 10 or 15 per cent of the value of the main home, that is not the case with vacation home policies.

So if you have a two-car garage and a boat house, you will need to arrange additional coverage.

Other things to think about include how you will use the property. Wortman says if you plan on renting your property, that will be considered to have a higher risk and will likely affect the cost.

In addition, any damage caused by tenants may be excluded from coverage

If you form a company to buy property as an investment, or buy a vacation home through your company, an insurance company will consider that to be providing insurance to a corporate entity, which can affect the overall process.

Wortman says it’s possible to get a traditional homeowner’s policy for a vacation home, but you would need to live there full time at least 50 per cent of the year.

What you need to know about property insurance


There is a major difference between insurance for a primary home and a vacation property, because of the added risk of the property only being occupied on a part-time basis.


When it comes to buy-ing real estate, timing is everything, and that’s

especially true for recreation, retire-ment or investment properties.

So will 2013 be a good time to finally buy?

With low interest rates, property prices that have come down in recent years and plenty of selection, the answer seems to be “Yes.”

If fact Re/Max’s annual Recreation-al Property Report from 2012 found that sales were ahead of the previous year’s pace in 70 per cent of Canadian markets across the country, in large part based on greater affordability and increasing consumer confidence.

“While buyers are still cautious, they’re motivated,” said Elton Ash, regional executive vice-president for Re/Max of Western Canada in a press release. “Current market conditions have placed them firmly in the driver’s seat. Activity has also been fuelled by pent-up demand that’s been building since 2008, when many began waiting it out on the sidelines. Opportunity does ex-

ist. Canadians love a good deal and there’s no question that there are still some to be had in recreational prop-erty markets across the country.”

The strength of the Canadian dollar has also led many Canadians to look south of the border into the United States for recreation property, especially in areas where prices have dropped considerably since 2007/08.

According to a 2012 survey by the U.S. National Association of Realtors, Canadians made up 24 per cent of international buyers in that country, more than double the rate in 2007.

But the window of opportunity may already be closing for the best deals in the U.S., based on the third quarter 2012 S&P/Case-Shiller Home Price Index.

The index showed home prices nationally were up 3.6 per cent, marking the sixth consecutive month of increasing prices.

Leading the way was Phoenix, a popular destination for Canadian buy-ers, which saw prices climb to a level 20.4 per cent higher than one year ago.

Here’s a look at some of the most

popular destinations for recreation, retirement and investment property in 2013.

Canmore Prized for its location only an hour

drive from Calgary and adjacent to Banff National Park, Canmore con-tinues to be a prime draw for local buyers seeking a mountain hideaway.

Current inventory also favours buyers, with everything from week-end condominium suites to town-homes and mountain estate homes on a golf course.

British ColumbiaCalgary buyers continue to value

areas within the magic three-hour driving time of the city, including pe-rennial favourites Fernie, Invermere/Radium, and Golden, B.C.

The Okanagan and Shuswap also attract people seeking the warmer climate of the B.C. Interior, while Vancouver and Victoria remain a preferred retirement destination for Canadians in general.

On Vancouver Island, other areas

such as Qualicum Beach/Parksville, the Comox Valley, and Tofino/Uclue-let on the west coast offer additional choices of real estate and lifestyle.

Northwest U.S.Montana and communities such as

Whitefish and Kalispell have been a staple location for Calgary buyers for many years, often ebbing and flowing with the state of the Cana-dian dollar.

With the loonie hovering at par-ity, buyers are also looking at new projects elsewhere in Montana and in other nearby states such as Idaho and Washington. These states, like Mon-tana, offer scenic beauty and value for gas and shopping that continues to lure Canadians looking for bargains.

ArizonaThe real estate recovery in the U.S.

is being led by Phoenix, with prices climbing and many of the best deals quickly being snapped up by Canadians.

But many opportunities still exist throughout Arizona, as prices still have

a long way to go before regaining the heights reached back in 2007/08.

A bonus for buyers is many Arizona real estate companies and developers have agents who special-ize in assisting Canadians with a purchase, to help them navigate the process.

Mexico and tropical destinationsIf a warm weather escape has

always been your dream recreation property, there are many great desti-nations available these days, includ-ing the always popular Mexico.

Mexico has so many areas to choose from, including traditional favourites such as Acapulco, Puerto Vallarta and La Paz, and new gems including Puerto Penasco and San Carlos.

Canadians have also discovered real estate in exotic tropical paradis-es such as the Dominicanß Republic and Belize.

Well known to savvy buyers from around the world, these countries offer their own unique appeal, along with exciting real estate op-portunities.

Low interest rates indicate now is the time to buy


The strength of the Canadian dollar has also led many Canadians to look south of the border into the United States for recreation property.

JANUARY11-13,2013 · The Dominican Republic ˜ sound investment with fully owned titles ˜ great...

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