Navigating the New Rules: Key Changes Impacting BC Home Buyers and Owners in 2025

As we step into 2025, several key policy changes in British Columbia’s real estate landscape promise to reshape the market. Whether you’re a first-time homebuyer, a seasoned investor, or a current homeowner, understanding these new regulations is essential. Here’s a breakdown of the latest updates:

1)  PRICE CAP INCREASE ON INSURED MORTGAGES

As of December 15, 2024, the price cap for insured mortgages has been raised from $1.0 million to $1.5 million. This change allows buyers to put down less than 20% on homes priced up to $1.5 million. Buyers can now access higher-priced homes with a smaller down payment, providing more purchasing power and greater flexibility to enter competitive markets or upgrade their current homes. While this increases affordability, it’s important to evaluate the long-term financial commitment of higher mortgage payments.

2) 30 YEAR AMORTIZATIONS FOR FIRST TIME HOME BUYERS

Eligibility for 30-year amortizations has been expanded to include first-time home buyers and purchasers of new builds as of December 15, 2024. This means lower monthly payments, as spreading mortgage payments over 30 years can significantly reduce costs, making it easier for first-time buyers to secure financing. However, buyers should be mindful of the increased total interest paid over the life of the loan.

3) FLEXIBILTY WITH OBTAINING A MORTGAGE

Homeowners now have greater flexibility when renewing their mortgages. Previously, switching lenders required passing another mortgage stress test, which often limited options. Under the new rule, homeowners can switch lenders without re-qualifying or being subject to the stress test. This increased lender competition could lead to better mortgage rates and greater flexibility, allowing homeowners to prioritize finding the best terms for their financial goals. To maximize savings, homeowners should shop around for the most competitive rates well before their renewal date.

4) CHANGES TO TENANCY RIGHTS

The BC Government made adjustments to eviction notice periods in 2024. On July 18, 2024, the notice period for evictions increased from 2 months to 4 months. Following public feedback, on August 21, 2024, the notice period was reduced to 3 months. For tenants, this provides more time to secure housing in the event of an eviction. For landlords, the adjusted timelines may require planning ahead when managing property transitions. Clear communication and understanding of updated timelines are key to avoiding disputes.

5) SHORT TERM RENTAL BAN

As of May 1, 2024, a short-term rental ban has been implemented across all non-primary residences in BC, with exemptions for municipalities with populations under 10,000. This limits opportunities for investors to generate income through platforms like Airbnb for non-primary residences, while aiming to increase long-term rental availability in high-demand areas. Property owners should check if their property is located in an exempt municipality to determine eligibility for short-term rentals.

These changes highlight the evolving nature of BC’s real estate market. Whether you’re buying your first home, renewing your mortgage, or managing rental properties, staying informed is crucial. If you’re unsure how these updates impact your plans, I’m here to help! Let’s navigate these changes together to make the most of the opportunities in 2025.