Here is a summary of the details of spending accounts related to CAFRD (Canadian Armed Forces Relocation Directive) benefits. There are two types of spending accounts: the Core Account and the Custom Account. Unused benefits from either account are forfeited and cannot be used for other expenses.
The Core Account is meant to compensate members for essential relocation expenses related to their move. It is not a fixed amount of funds.
The Custom Account is a fixed amount of funds determined by an individualized formula. It serves two purposes: enhancing benefits from the Core Account as indicated in the directive and providing flexibility to choose other CAFRD benefits that meet the member’s relocation needs.
The formula for the Custom Account is A + B + C = D, where A represents the accommodation factor, B represents the transportation factor, C represents the HG&E (household goods and effects) shipment factor, and D represents the total amount available in the Custom Account. The transportation factor is calculated using a kilometric rate based on the Department of Finance income tax deduction limit for the use of personal vehicles for business purposes.
The Custom Account formula also includes specific calculations for each factor. A is the greater of $1,000 or a percentage of the real estate commission based on the sale price of the principal residence. B is 35% of the cost of one-way transport for the member and dependents. C is 35% of the average cost of shipping qualifying household goods and effects per qualifying room.
Qualifying rooms for the HG&E shipment factor are listed, including bedrooms, kitchen, living room, etc. When items are shipped out of long-term storage, the formula is based on the number of qualifying rooms when the items originally went into storage.
In cases where a member shares accommodations with individuals other than their spouse or dependents, the HG&E shipment factor is based only on the rooms occupied by the member.
Ottawa is typically known to be a low inventory real estate market. This is changed slightly this year due to current market conditions. Military buyers will have more to choose from on their Ottawa relocation house hunting trips. Our team is also doing everything we can to present as many options as possible. We have put out thousands of flyers looking for home sellers to match with our incoming military buyers. This program is in its fifth year and it continues to be a success. We have been able to create win-win situations for both buyers and sellers. Buyers get the benefit of purchasing a house off market at a fixed cost and sellers have the opportunity to potentially sell off market with very little showings and no staging.
If you’re relocating to Ottawa feel free to get in touch and learn more about the programs we offer our incoming relocation clients.
BMO is the official bank of the Canadian Defense Community. This makes BMO and the Chris Scott Team a perfect fit for our military clients. We always have our client’s needs top of mind and strive to make each relocation as smooth as possible. We know the ins and outs of BGRS and know that during an HHT time is always of the essence. BMO has specific mortgage programs tailormade for military relocations that offer tight turnarounds on pre-approvals so you can rest easy during your HHT. We have a guest blog from our local Defense Mortgage Specialist Naween:
RELOCATION IT’S STRESSFUL. WE GET IT AND WE ARE HERE FOR YOU
Relocation is not a simple task. It’s very stressful. Leaving family, friends and a familiar environment is a daunting feeling. I have gone through 5 relocations myself, so I know the feeling. My biggest relocation was migrating to Canada. Moving 13,632 km, away from everything I knew for 23 years. The level of anxiety I had was through the roof, but I was also excited to start a new chapter with my wife. It took us time to settle, and we finally made Ottawa home. Bought our first home, had our first child and a new opportunity came along resulting in an out-of-city relocation. Two more relocations after we are back in Ottawa. Each relocation was stressful even though we had done it before. We had to tell ourselves it was ok to feel the way we did. The personal and professional growth I gained from them will not change my mind about doing it all over again. We became comfortable with meeting new people and making new friends with each move.
The biggest stress for us about relocating was finding a place to live. Temporary accommodations in hotels can only get you so far until the smell of eggs in the morning makes you sick. You have a limited amount of time to find a place that fits you and your family’s needs. This is where the expertise of a good realtor was a game changer. When we relocated to Sudbury for work, our house search revolved around a 9-month-olds schedule and needs. We had to think about daycare, schools (yes, it was a bit of a stretch to think of schools when our son was only 9 months), convenience to get to and from work, etc. New city, no support system to count on. We started our house search online in Ottawa and would send listings we wanted to see to our realtor having no idea about the areas. I remember to this day what our realtor said about a listing I sent. House looked great in pictures, well below our budget. Her exact words “We are not going to see that listing because you are not going to buy a home in that area. I don’t want Evan growing up in that neighborhood”. We soon came to realize that that neighbourhood was not suitable for kids, and the house was on a very busy street. I was reassured my realtor had my back and I was no longer stressed about finding the right home for our family. This is the same level of care and attention Chris Scott and his team bring to the table. They understand your needs and find properties to fit that need, so you don’t waste time.
Therefore, I am proud to align myself as the mortgage specialist assisting the clients of Chris and his team. They share the same values as I do, personally and professionally. Putting the client’s needs first vs getting a sale done. Focusing on advice and recommendations to protect you and your loved ones. Combining 6 years of mortgage experience, Chris and his team and BMO’s Defense Banking Program I am confident we can make your house purchase a stress-free experience.
If you have any questions about home financing or want to talk about my personal experience of relocation feel free to contact me. I am happy to answer any questions you have
Naween Thomas | Mortgage Specialist
(P) 613-709-0890
Ottawa is a very popular destination for military clients. Many come for a few years and get posted out only to return again with a promotion a few years down the road. With this type of short-term stay, you need to purchase at the right price to be able to sell with a nice profit when you get transferred out. Others may have their final stop in Ottawa and want to make sure they get a home that can suit their needs for years to come.
We thought we would share with you a few examples of homes we helped our military clients purchase in recent years and that they just sold this year:
Purchased in 2020 – $790,000 Sold in 2022 – $1,250,000
These clients sold their Fairwinds home with our team in 2017 and got transferred back to Ottawa in 2020, during a very challenging market for buyers. During their HHT they were clear they wanted to be back in Stittsville and find something with good value. The timing was not great as they were purchasing in a very fast sellers market. Our clients ended up competing in a multiple offer situation. It is important to note that we were not the highest offer in this multiple offer situation, but the seller wanted to work with us and sell to my clients. That one decision had an incredible impact for my clients. You can see what they bought it for back then and sold it for earlier this year.
Purchased in 2020 – $665,000 Sold in 2022 – $931,000
Another military client of ours purchased in 2020, during the same challenging market. They also wanted to live in, and ended up buying in Stittsville. This is a great example of how there are still deals to be had during a sellers market and we ended up getting a great deal for our buyers. The house needed new flooring on the main level and was passed up by other buyers because of this. Our clients were not phased by this small issue, they lived here for a few years, and then ended up getting new floors installed on the main floor. This small investment of a flooring project helped them capitalize on ideal conditions when they sold.
HHT’s are challenging and timing is everything, which is why having an experienced Realtor® on your side makes all of the difference when it comes to your biggest investment. We are here to help!
Our team prides ourselves in taking great care of our military clients. A big part of that is helping our clients who relocate to Ottawa purchase homes that will sell easily and appreciate nicely by the time they get transferred out. Selecting the right home, neighborhood, and community are also essential for the enjoyment of your time here. In short we know how important your Ottawa HHT is to you and your family. The house you buy will also have implications down the road when you sell. We need to make sure you are getting the right home for your needs.
Selling with our military specialists
The sale process is seamless with our team because we understand BGRS and have the appropriate partners who are all approved service providers. We are also one of Ottawa’s most recognizable military teams. We have the buyers coming in on postings that we can match up with our listings. One of our strategies is that we send out letters to prospective sellers ahead of posting season to spread awareness of incoming military buyers and our ability to match buyers with sellers of off market listings. This makes the process even smoother for everyone.
Some service providers no longer dealing with BGRS
Many prominent lawyers have decided no longer to accept BGRS files due to the low fee they receive for service in relation to their standard rates. This is something that we will keep an eye on moving forward. We still have some great lawyers on the list. Some Realtors are also pushing back and not accepting military sellers. While others are scaling back their services that they provide when selling a military members home.
This is not the case with our team. We offer the same high level of service clients have come to expect from us. Here are a few of the things that we are offering to our military clients:
When relocating to another city it is important to know what is going on in that real estate market. We wanted to share our most recent update and video, to assist you with planning for your house hunting trip to Ottawa.
Things are picking up as we head into the Spring season. We have seen a 52% increase in transactions from January to February of 2022 via MLS. This is a strong indicator that the Spring market has sprung.
The number of new listings in February (1,762) offers some hope for prospective Buyers. At 4% higher than the five-year average and 12% higher than February 2021, it resulted in an almost 10% increase in residential-class property inventory compared to last year at this time.
There is hope that the trend of increased new listings will continue so that the housing stock can be replenished.
We are now sitting at less than a month’s worth of inventory, which is still looking like a seller’s market. This means buyers need to have all of their financing set up so that they can move quickly in this market.
Our team has strategies that can help both our buyers and our sellers in this type of market. Please reach out if you have any questions about the current market or anything else we can help with.
I know that one of the biggest challenges with real estate and house hunting in Ottawa is the lack of available homes for sale. Rest assured our team is doing everything we can to find off-market opportunities for our incoming military buyers. We were able to pair up a few military clients last year with off-market deals. We have just proactively sent out over 25,000 letters for this express purpose to our local communities.
The system does work. Here is an example:
A seller in Jackson Trails, Stittsville got in contact with us about selling their detached 4 bedroom home. On the outside, it looked like most others in the area. On the inside, the house was extremely cluttered. Writing that I almost feel like that is an understatement. Lots of religious artifacts throughout the house and it would have needed a total staging overhaul. I presented each option to the seller and they said they would consider an offer off market if they could get a very specific price. The price was about what they would have got if it was staged.
On the other side, our buyers were coming in as a military transfer from another Canadian base were getting fed up with the process of offering against 15-20 other offers. It can be overwhelming, to say the least. They were happy to pay a slight premium for the exclusivity of the deal. This allowed everyone to leave happy.
We also had another past military client sell exclusively to an international military transfer to Ottawa. Again, they had a price they wanted and we delivered. In both cases, the process was smooth with only one showing each. In both cases, the buyer did not actually see the home in person until we showed up on closing date. We took care of every detail of these purchases and sales for our clients. House hunting is stressful enough, add on top of that relocating to a new city, we pride ourselves on being there every step of the way.
In closing our team is proactive with trying to produce options for our military clients relocating to Ottawa. If you are posted to Ottawa feel free to get in touch with our team. We are here to help!
I am so excited about our new military division coming to Keller Williams! We are the first major brand to have such a division. It reinforces the importance our company places in supporting our troops with their real estate needs.
It was such an honor to meet Levi Rodgers. He is the new head of the Keller Williams military division. He is a veteran with an incredible story of bravery and determination. During his deployment, his vehicle was hit with an IED. He was the only one to survive the attack. He was heroically dragged to safety and there was not much hope he would make it. He was in a coma for weeks and had years of recovery ahead of him. Suffering from injuries and PTSD he left the army to start a career in real estate. He now operates one of the largest real estate teams in North America with over $900M in annual sales. Incredible achievement. Talk about perseverance!
I am so thrilled to work with and learn from Levi. Our team is proud to serve so many CAF members as buyers and sellers every year who relocate into and out of Ottawa. This new division will provide training and networks not available anywhere else. We will have the best connections across Canada and North America for our Ottawa clients who are posted out. I am so proud to be a part of this company that is so aligned with what we do. This new division ties so nicely to a core pillar of our business, assisting members of our military with their real estate needs.
It has been a successful year for us so far at the Chris Scott team with Military Relocations. The only way we are able to make these military relocations work is as a team. Chris, Colin and Rachel take a team approach to ensure we are providing the best client experience for both our buyers and sellers.
We helped relocate 18 military families so far, this year alone. We thought it would be of interest to share the neighbourhoods in the Ottawa area where they are located. As you can see from the map below, we work in all areas of the National Capital Region.
Jackson Ridge in Carleton Place, ON
Cam’s Way, Beckwith, ON
Admaston/Bromley, Admaston, ON
Richmond, ON
Stonebridge, Nepean, ON
Redwood Park, Qualicum Woods, Ottawa, ON
Jackson Trails, Stittsville, ON
Fairwinds, Stittsville, ON
Westwind, Stittsville, ON
Stittsville South, Stittsville, ON
Stittsville South, Stittsville, ON
Heights South, Orleans, ON
Notting Hill South, Orleans, ON
Avalon Encore, Orleans, ON
Hiawatha Park/Convent Glen, Orleans, ON
Springridge, Orleans, ON
Morgans Grant, Kanata, ON
Longfields, Barrhaven, Nepean, ON
Wherever you are most comfortable looking for a home in Ottawa, the Chris Scott Team has the knowledge and experience to help with your relocation- before, during, and after your HHT. Our mission is to turn every client into a Raving Fan!
Ottawa has many rural areas that are of interest to our house-hunting military clients. Estate lots can provide privacy and space to spread out. It is important to note the directive on lot sizes if you are considering buying this type of property. Brookfield may not cover a portion of your land transfer tax if the house is over 1.25 acres.
Per CFIRP Directive 8.1.05 Lots and lot size,
The reimbursement of expenses is limited to a lot size of:
• 1.25 acres (½ hectare); or
• up to four acres (2.47 hectares) where required by zoning laws and city bylaws.
If additional land is sold or purchased, CF members are entitled to reimbursement only for that portion of costs which would have been reimbursed within the above limitations.
If there is a zoning bylaw for your area that requires this larger lot size in order to purchase in this area, then you can submit proof of this and resubmit the claim.
If not, the requirement is that you supply 3 comparables of properties in the area at 1.25 acres or less. If this is not possible, as you note, you will need to have an appraisal done of your own property at 1.25 acres to show that the additional acreage adds no extra value. Despite the letter provided, it will need to be an appraiser and not a realtor who provides this information. If the appraisal shows no additional value, the claim can be processed as submitted. If there is additional value, the reimbursement will be capped at the value of 1.25 acres.
As a trusted military Realtor in Ottawa we will work with BGRS to provide the letters and comparable properties they need in order to pay out the refund. This year we successfully defended 2 properties. In one case we had to go through the process a few times to get the exception. There is no guarantee. This is something that BGRS is getting more strict about and is something that military buyers in Ottawa should be very aware of.
If you are planning your house hunting trip and relocation to Ottawa I hope you will interview us for the job! We specialize in this type of transaction.
