Vancouver Lofts and Live Work lofts - Mortgage

With property values so high in metro Vancouver and the popularity of urban live/work spaces rising, it makes sense to fully investigate the benefits that you may be entitled to as an owner of a unique Vancouver Loft.

Vancouver streetVancouver lofts have long been coveted by local artist and craftsmen for there unique abilities to blend work space with open living quarters. The history of these properties comes from the days when Vancouver used to house a plethora of textile factories, garment districts and consumable’s manufactures. As these industries became cost ineffective and went overseas, they left behind some of Vancouver’s most coveted Real Estate to be. Even in the historic district of Gastown lofts have seen a lift in popularity with units priced up to over $1 million plus!
With values and demand rising, many property owners to be are inquiring about the possible benefits of live work lofts in Vancouver. Below are some of the more important aspects to consider when looking at a live/work loft
So what’s the deal with a live work loft?
Live/Work Loft: An officially designated workspace where the occupant operates a home- based business or dwelling unit, part of which may be used as a business establishment and the dwelling unit is the principal residence of the business operator. This definition matters most in cases where buyers are looking for a storefront or business where clients visit the office. Most often, these suites are limited to the ground floor and street level, which may not the most desirable location for strictly residential use.

Tax Implications:
Like with any investment have your accountant and Investment Advisor check out your tax implications and watch out for claims of significant tax write-offs. When running a home-based business, there indeed are tax benefits to having a work space at home, whether you’re in a live-work configuration, regular condo or detached home, with the proper tax set up and configuration you may have these options available regardless of the lofts zoning. There are also write-offs when you’re renting, so make sure you consult a tax expert to verify any (this included any 2010 rental plans you may have).

Financing: One area where the live-work definition is very important is in financing. In Canada, any mortgage for which the buyer doesn’t have a down payment of 20% must be insured through companies such as Canada Mortgage and Housing Corporation and Genworth Financial. The mandate of these insurers is to help provide Canadians with affordable and quality housing – not to insure commercial property mortgages. This aside, they recognize that many Canadians work out of their home, thus 25% of a property’s floor space limit may be designated as work space in the agreement of purchase and sale. Anything more than that won’t be insurable, which can cause some very significant problems.

Ask hard questions: do you really want to live in or rent out a building full of small business owners, where the common areas during the day could be very busy and noisy, when you were just looking for a nice, quiet open concept loft instead? After all, at the end of the day, marketing and insurance issues aside, a live-work condo has to be comfortable enough to actually live and work in.

David HudsonGet a mortgage for your Vancouver loft: David Hudson is a manager of Real Estate lending with TD CanadaTrust. David has worked in the Financial industries of the US and Canada and is a specialist in Lofts and Strata properties. Catch David’s Blog or he can be reached at [email protected]