UNRAVEL REAL ESTATE
Terminology in Whistler
Properties purchased in Whistler have been categorized by the Resort in order to ensure that Whistler can both maximise the bed space available to tourists as well as enable individuals to invest in real estate. It is important to understand the 'Phase' type that your potential new home is categorized under, because it will may a large impact on your decision making process.
The Phase 1 zoning allows the owner to do the following:
- You can occupy the property on a full time basis
- You can rent the property on a month to month tenancy
- You can rent the property on a nightly / weekly basis
This zoning states that if you are not occupying the property on a full-time basis you are obligated to make it available for rental. It is more or less a gentleman's agreement as no one from the Resort Municipality of Whistler enforces or checks to see the status of the property.
If it is unknown, as to the owner's usage (personal versus rental) the taxes are based on the residential tax rate, substantially lower than the commercial rate.
Many of the Phase 1 properties are rented privately or have more owner usage so it is difficult to get rental revenues that have any useful value. It is advisable to talk to a property rental management company prior to any purchase to determine what they feel the potential revenues might be.
Phase 2 zoning is very restrictive with respect to the Owner's usage. The purpose of the zoning is to make sure there are always a large number of properties available to resort guests at any given time. The zoning allows the owner to do the following:
- You have personal use of your property for up to 28 days in the summer season (April 15 to Oct 15) and up to 28 days in the winter season (Oct 15 to April 15) Change over occurs at 2:00PM
- You can book a maximum of up to 21 days at any time in each season
- You can make short term bookings which the hotel can honour if the occupancy rate is less than 80%. This does not affect your long term booking days.
As the property must be made available for nightly rental they are considered commercial ventures and taxed at the commercial rate. As well, all Phase 2 properties have a hotel management contract and pooled revenue sharing that you must accept as part of your purchase.
Individual Suite Vs Rental Pool*
It is also important is to consider the rules and regulations enforced by the Strata Management company with regards to 'how the property may be rented' The two main types of rental are:
Properties considered to be 'Individual Suites' can be rented nightly, monthly or yearly and will only received income as and when it is actually rented.
Properties placed into a 'Rental Pool' receive a proportion of the total daily revenue, irrelevant as to whether the actual property is rented or not. The share of this revenue is relative to the other suites in the rental pool, ie. the value received is based on square footage, bedrooms/bathrooms and views which is called ?Interest Upon Destruction? (UID) or unit factor (UF) number - which is set by the developer.
* Based on general concepts, but buyers should check management contracts on each property, as there are various versions of the concept.