Although interest rates are on the rise and there are concerns about increasing taxes, Canadians are still investing in recreational properties. Even with the new CMHC laws, Canadians seem to be motivated to achieve a better lifestyle. CMHC only require a minimum 20% down payment on a secondary home if you will be earning income from the property. If you sign a declaration stating it is your secondary residence and you will not be earning income, you can put down as little as a 5%. A nationwide survey commissioned by Royal LePage Real Estate Services showed that people are more worried about the increasing property taxes and new HST affecting their ability to purchase recreational homes while only 10% said an increase in interest rates would deter their desire to buy a second property.
It seems as though more Canadians are able to recognize the value of vacation home in regards to enjoying their leisure time and in terms of an overall increase in quality of life. In order to achieve the financial ability to sustain a recreational property, 15% of survey respondents plan to invest with family or friends while 25% plan to rent out their property for part of the year. Within Alberta, buyers are considering purchasing a condo as a recreational property within the next 24 months, more than any other region in Canada.
If you are looking to invest in a second home within Alberta, please contact us or fill out our secure online mortgage application. One of our Licensed Mortgage Broker will contact you to determine what size of a mortgage you can be pre-approved for or can help you refinance your mortgage in order to free up some equity for a second investment.