Spring fever has hit me hard! And like most of you, I’m dreaming of a cottage getaway. The smell of pine needles, a quiet sunset on a dock and the contentment that comes with a cottage by the lake.
Cottage-buying check list
- Add up all the costs of ownership
- Try to estimate how much costs will increase
- Put money aside for the unexpected
- Include the cost of mortgage insurance
- Ask whether it’s a financial or lifestyle choice
If you are seriously considering buying a place by the lake you will have to take a hard look at what it will really cost to have a place like that of your own.
Cottages themselves come with a pretty high price tag, and that’s just the beginning. There’s taxes, maintenance, fees to dock and store your boat at a marina, maybe winter ploughing of your road, internet and TV — and the list goes on so you have to do your homework before jumping in. Do you actually have financial room right now to add the type of expenses that come with a cottage?
Many people buy a smaller cottage and renovate it into what they want, in order to save on the initial price tag. But that can be an expensive project for a place that you only spend summer weekends at. General maintenance is top of the list of cottage costs. There’s always something that needs attention.
A cottage is a luxury.
One owner estimates that someone spending 50 days a year at their cottage, costs them $250 per night fo the privilege. You can’t always justify it economically, because it gives a new dimension to your life. Many feel that it’s the greatest purchase you can make from a spiritual perspective.
That may be true, but even a dose of spirituality has its price — and buyers need to beware. Preparation is everything and the owner shouldn’t be surprised by the carrying costs. You should try to get a feel for the projected increases using historical rates of growth, to make sure you can afford to carry the costs going forward. The same goes for municipal tax increases, utilities and insurance.
The cottage seems to have more unpredictable costs associated with it than a primary home as well, such as damage from a heavy winter snowfall or repairs to the road leading into your property. Also, depending on how much of a down payment you have, you may be faced with mortgage insurance. Mortgage insurance on your primary home will not cover a second one as it is specific to each property. Canada Mortgage and Housing Corporation (CMHC) no longer offers second property mortgage insurance, but others insurers do.
So where does that leave you? Should you invest in a cottage? It depends what you are looking for. If the decision is based on lifestyle you might be willing to make some bigger trade-offs than if your goal is to use the cottage as an investment. As an investment, a cottage is probably not a wise one, but the non-financial considerations are what you need to think about after you’ve quantified everything else. So if you’ve established you can afford it then you have to ask yourself if it is really worth it to you.
For some owning a cottage is just not worth it, and they will rent for the cottage experience instead. But others find value in the family time and tranquility the cottage allows.
Buying a house in the city or suburbs can be complicated enough, but buying a cottage or vacation property outside of town requires even more due diligence. The questions for a realtor when you buy a cottage are somewhat different from those when buying you house in the city.
For example, in town, you probably wouldn’t ask if the water coming out of the tap is drinkable. Nor would you wonder if the plumbing was hooked up to the sanitary sewer. But these are exactly the sorts of questions you should ask when buying a cottage, plus a few more.
1.Always get an inspection.
Cottages are usually occasional residences and so may not be as properly built or maintained as they should be. This is why every purchase should be conditional on a satisfactory professional home inspection. If the cottage has a wood-burning stove or fireplace, then a certificate must be requested from a Wood Energy Technical Transfer specialist, to confirm that the system was installed and is operating correctly.
2.Is the water drinkable?
There are two areas of potential concern when it comes to water – the quantity and quality. Is there enough to satisfy family needs and is it good enough to pass the local health department requirements. A separate inspection may be needed by a well specialist. If nothing else it gives you an idea of what it would cost to replace the well if it fails.
Ask the sellers for these things:
- Confirmation that the well, the pump and related equipment have performed adequately during the Seller’s occupancy;
- A potability certificate from the local health authority, confirming the water is safe to drink;
- Confirmation that there is an adequate rate of flow for normal household use;
- Provision of a well driller’s certificate, if available; and
- The location of the well.
3.How’s the septic system?
Septic systems present their own difficulties because it is usually difficult to tell during an inspection how long the system may last. The replacement cost can be up to $20,000, especially if there are stringent environmental regulations in effect in your area. The buyer should arrange for their own separate inspection of the system itself.
Buyers should ask for confirmation that:
- The system was installed with all necessary permits;
- The system has been adequately maintained;
- The seller is not aware of any malfunctions;
- The seller will provide copies of any inspection or approval reports in their possession;
- The seller agrees to pump out the tank at their expense prior to closing; and
- There are no work orders on file with the Ministry of the Environment or the local municipality.
In a regular house you often have a yard that faces on a street, and you know that you don’t really own the property from the sidewalk to the street. But what about the shoreline? Do you own the property all the way up to the waterline? In some instances you do, and in a lot of cases there is a shoreline allowance that you do not own. Many people are very surprised by the anwer to the is question. Make sure you know where your property line ends when it comes to the shoreline.
The first 66 feet fronting onto the lake is typically owned by the local municipality and is referred to as the shore road allowance. Although you have access to the water, you can’t stop others from using it. Nor can you build anything on that 66-foot piece of land. Many cottagers have found out afterwards that either all or part of their cottage was built on land that they do not own.
You may be able to buy the land from the municipality, but it is a process. If you can get an up to date survey from the seller, this should answer your questions. Also inquire to make sure that any required permits were obtained to build a dock or boathouse, as there is no automatic right to do this. In all cases, make sure you have title insurance, which should assist with most of these types of issues.
5. Access to the cottage
If you do not have year round access by a city road, then you must ask how you get from the road to your property. If it is a private right of way over a neighbour’s land, you must understand the terms of this agreement to ensure it is year round access and it is clear who is responsible for maintaining the road.
If there is no registered right of way, it can be a nightmare, with owners fighting over who has the right of way and who owns it.
For all of these reasons, it is recommended that buyers work with a local real estate agent who should be familiar not only with each of these issues, but more importantly, will be able to recommend the professional inspectors and town officials who can satisfy a buyer’s concerns.
By being properly prepared before buying a cottage, you will avoid unwelcome surprises after closing.
WHITE LAKE, N.Y. (CBSNewYork) — It could be the real estate opportunity of a lifetime — acres of land, and a luxurious home on a private lake could be all yours for $149.
As CBS2’s Lou Young explained, there’s a catch.
High in a knotty pine paradise, Kelly Lavorgna took CBS2’s cameras through the vacation home being offered as a prize in a contest.
“We eat here, every meal, we play games. The view is magnificent,” she said.
The cozy, well appointed two bedroom retreat overlooks an expansive fish filled lake.
“The lake is just awesome; we love boating, we take the kayaks out, do some fly fishing down here as well,” Andrew Bares said.
“You can’t help but relax here,” Lavorgna added.
It’s a Catskill dream home a short distance from the famous Woodstock concert site in the nearby Bethel.
Lavorgna said she and her husband no longer have the time to enjoy the home.
“We feel like it’s wasted on us. We love the place, but we want other people to enjoy it just like we did,” she said.
The contest requires an investment of $149 and a written explanation of why the contestant wants to own it.
The couple has tried twice to sell it, and decided on this tactic as their only chance of getting back some of the investment they made at the height of the 2008 housing bubble.
“We’re going to take a loss, but you know, prices are different now. The second home market never recovered from the crash,” Andrew said.
The math indicates that they need 5,500 applicants to make the deal work, but that leaves at least 5,499 potential sore losers, and just over $819,000.
For that reason, they’re not judging the contest themselves, but hiring a panel of outside experts.
“We have 10 judges that we’ve very carefully hired and vetted. We have no say at all,” Kelly said.
Grammar, originality, and creativity are all factors.
Since it takes time — an additional investment — real estate experts said the contest is not an approach most home sellers should consider.
“This is a limited option for people of means,” Nancy Elsas said.
If the sellers don’t get the minimum number of contestants, they’ll refund everyone $100 and apply the remaining $49 to administrative costs.
The winner would owe taxes for the assessed value of the home and be liable for property taxes and homeowner association fees — about $11,000 a year.
“You have $149 and you’re going to lose $49 of it, and you want to write an essay because this house looks intriguing and you know that — maybe you’re looking for a house in the area? Absolutely do it,” Elsas said.
The contest runs through the end of April, and while it is in part about money, with a home there’s always an underlying risk.
“We really hope that the house goes to somebody who wants it and deserves it,” Lavorgna said.
Perhaps that’s you.
To enter the contest, click here.
The Corporation of Delta has retreated from its sweeping changes to the secondary suite program following a storm of complaints.
On Monday, Delta council voted unanimously in favour of staff recommendations to cancel a number of amendments approved last year and go back, for the most part, to the previous regulations.
Finance director Karl Preuss explained the revisions mean the municipality will once again accept declarations from property owners for suites that do not generate a rental income.
Delta will also continue to offer the annual $300 reduction in utility fees for secondary suites with an occupancy permit and will eliminate a $300 annual secondary suite fee that had been imposed. The suite fee will be replaced with an annual $50 business licence fee in 2018 that will only affect property owners whose secondary suites are in compliance with Delta’s regulations and generate rental income.
However, a change to the water service bylaw, which now requires all houses with a suite, regardless of whether it’s being rented, to be metered for water consumption will remain in place.
According to the municipality, it had cancelled the $300 reduction in utility fees, which had been an incentive for legalized suites, required meters and imposed an annual fee to further improve occupant safety and ensure all homes with secondary units are paying an equitable amount.
Delta had also stopped accepting signed statutory declarations, a statement by a homeowner that a suite is not being rented and all residents in a house have reasonable access to all rooms within the dwelling.
Coun. Heather King said the approach Delta is taking is fair and palatable.
“Yes, there may be occasional abuse but I don’t think we should have a policy that is for the one or two abusers. It needs to be for the people who do have family members staying with them and have legitimate needs,” she said.
Coun Jeannie Kanakos agreed, acknowledging many complaints had been received by municipal hall.
“I think what we’ve come up with is an approach that is balanced. We want always to be looking to have secondary suites that are safe, where there is a reasonable policy and where the seniors can have their kids come home and occupy a secondary suite or have a summer cooking kitchen in the basement. That’s reasonable,” she said.
As far as new home construction, a new policy introduced last year making it tougher to include a legal suite won’t change. A new suite will only be permitted for lots that are 15 metres in width or greater, and there’s also a number of other new provisions, including location of parking stalls.
The move was in response to complaints about homeowners with secondary suites who make their tenants park on the street.
Looking for a place to house an elderly parent or teen?
What about bringing in a renter to help pay off that massive mortgage?
Soon, some Port Coquitlam house owners will be able to build a coach home on their property.
Tuesday, city council received a report about regulations that, if enacted, would allow “granny flats” to go up on large residential lots.
Under the proposed rules, which still need to be passed by council and go through a public hearing, homeowners can build a coach home up to 753 sq. ft. — the same size as is permitted in Vancouver.
The proposed changes come after a public consultation last summer and aim to add more affordable housing to PoCo’s stock and to boost the city’s population — a requirement under Metro Vancouver’s regional growth strategy.
Under the regulations, applicants would notify their neighbours as well as post a sign on their lot about the proposed home.
Coun. Mike Forrest, chair of the city’s smart growth committee, which would review each application, urged area residents to air their views early in the planning process.
“Please come and have a discussion,” he said. “I would prefer it to be done at committee rather than at council.”
Parking is expected to be a hot topic, some councillors suggested at Tuesday’s meeting.
While an on-site space is required for coach homes (and, under the bylaws, for any new secondary suites), tenants may not always park on the property.
The spill-out onto streets could eventually force the municipality to issue parking permits for coach home occupants, Coun. Darrell Penner said.
Mayor Greg Moore also said council may look at taxing coach home residents in the future (coach home and secondary suite renters are required to pay utility fees) as taxpayers would have to subsidize the municipal services that they use.
But Coun. Dean Washington pointed out those extra services — i.e., policing, road maintenance, etc. — would be paid by the landowner, who will have a higher property tax bill as a result of a larger tax assessment.
Coun. Glenn Pollock said the proposed coach homes regulations “don’t go far enough” and wants to see more flexibility. He said infilling properties with coach homes is a better way to densify than allowing highrises.
As well, Coun. Brad West said the city needs to keep an eye on coach homes being used as Airbnb rental units, a temporary accommodation use that’s not regulated in PoCo as it is in other communities such as Vancouver.
Coach homes have been allowed in Coquitlam since 2012. In Port Moody coach homes are not currently permitted “but they are being explored as part of our zoning bylaw review,” city spokesperson Rosemary Lodge said.
Maximum sizes for coach houses in other cities:
• Delta: 42 sq. m.
• Coquitlam: 50 sq. m.
• Richmond: 60 sq. m.
• Vancouver: 70 sq. m.
• Maple Ridge: Up to 90 sq. m.
• City of North Vancouver: 74.3 or 92.9 sq. m. (depending on type)
Secondary suites are fast becoming an issue in Courtenay.
Neighbours of the proposed suites are worried that the properties might be sold in future to absentee landlords who might not check on their tenants’ activities.
Plus, according to residents who turned out for a public hearing Monday night on a proposed rezoning for an Evergreen Avenue secondary suite, they had deliberately purchased their homes to be in a single family zoned area.
They didn’t want the extra traffic and noise associated with more residents in the area.
In the fall of 2016 Suzie Leroux and Mark Reiss applied to rezone their property at 1066 Evergreen to permit a small secondary suite in the basement of their single family dwelling.
The city’s Official Community Plan (OCP) supports secondary suites as a form of infill development as long as the development is in keeping with the character and scale of the neighbourhood.
A review of historical rezoning applications for secondary suites indicates that seven properties located within 2 km of the subject property (Brooks Place, Thorpe Avenue, Teal Place, Valley View Drive, Snowbird Lane, Mallard Drive and Nikoliasen Road) have been rezoned, according to the report presented by Ian Buck, director of development services.
The couple making the application held a public information session, as required, in December. Only one couple showed up.
“They said they were against the secondary suite, because years ago, their neighbour made a legal suite, and it became occupied by some, I quote, “ladies of the night” (hookers),” wrote Leroux to the city.
But more than one couple showed up at the public hearing to object to the rezoning.
One resident of 9th St. East, at the intersection with Evergreen, said he’d lived there for 29 years.
“We bought there for the single family homes and I think it should stay that way,” he said, adding that there were already a number of illegal suites in the neighbourhood.
Another resident, of Mantle Drive, said secondary suites were fine as long as the primary owners were living there.
It’s when the owner moves out that problems can arise, he said.
Another Mantle Drive resident said she moved to the area because it was quiet.
Secondary suites cause increased water use, traffic and noise.
“The more people … the worse it gets,” she said.
An Evergreen Avenue resident said the proposed suite’s proximity to the new hospital and North Island College just adds to the “lots of tenants” already on the street.
It “changes the entire dynamic of the neighbourhood”, she said.
Another speaker, who doesn’t live in the neighbourhood, asked council why there were still no regulations for AirBnB rentals. There are dozens of city homes renting out rooms through this online service.
The applicants said their suite would only have one bedroom, with a total size of 760 sq. metres, with its own driveway on the property.
“There are a lot of illegal suites on our street,” Leroux told council.
Council will make a decision on the rezoning at their next regular meeting, set for Feb. 20.