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Finances & Real Estate I'm a Realtor, ask me anything

Discussion in 'General Discussion' started by APReal, Jul 19, 2011.

  1. APReal

    APReal Junior Member

    Thread title says it all. Any questions you want to know about real estate, realtors, presale condos (my specialty) ask away.
    I know a lot of us Realtors have a bad reputation too, so prepared for the nasty questions too. Flame away if you'd like.
  2. milquetoast

    milquetoast Senior Member

    What's your opinion on whether or not real estate prices will go down for Metro Vancouver?

    I've seen two sides, with the former being the most popular:
    1. POP! All signs indicate the market is unsustainable.
    2. There is no housing bubble. The prices are being sustained by foreign money.
    The only thing people seem to agree on is that real estate in our city is overpriced and out of reach when average income is considered.
  3. APReal

    APReal Junior Member

    The million dollar question!

    I get this question all the time, and the first thing I say is it's not a Realtors expertise or position to really answer this.
    We often get a bad reputation for always telling people things like "prices always go up!", "buy now, before you're priced out forever!", and I'm certainly not one of those agents.
    The last thing I would ever want is someone to spend their life savings because I told them things are going up, and then see them lose everything over it.

    My expertise is to help people make the best decision and transactions within the market they've decided to act it, & be aware of short term trends from recent past and forecasted for the short term future. Not long term predictions on the market; I'm not an economist of financial planner.

    Having said that, I'll give you my opinion on the question, but it's only my opinion and it's worth what you've just paid for it.

    Yes the market is very expensive and unaffordable for many people, but I don't know if that necessary means it will pop! There may just be enough wealthy buyers & foreign money coming in to Vancouver that keeps the prices high and unfortunately out of the reach of many locals.
    Area such as Manhattan and London show situations like that, where only the very wealthy can live in the inner city, and everyone else just has to move to the burbs, yet the still maintain buyers and their prices.
    I'm not suggesting Vancouver = NY/London but I think we're seeing that on a smaller scale.

    I could see some small scaling back in pricing, but the dramatic 20% decreases people talk about with popped bubbles would really shock me. I think there's too many buyers out there that would scoop up anything being sold off and would mitigate such dramatic declines.

    Until mortgage rates climb significantly I don't think we'll see any significant changes, but we will see certain areas increasing and others leveling out or decreasing.
  4. 070

    070 Guest

    Hi APReal,

    First post/new to this forum. What are the fees and closing costs when it comes to buying a house? I am researching whether or not it makes financial sense to stop renting.

  5. APReal

    APReal Junior Member

    Hi Dave,

    The varying closing costs depend on the particular property, but I'll list most of the general ones:
    -Property Transfer Tax: Charged on all purchases and is equal to 1% on the first $200,000 and 2% on the balance above that. For example a $400,000 home has a PTT of $6000.
    If you are a first time buyer, and the home is under $425,000 you are the only exemption to the PTT. A partial exemption is also given for homes $425,000 - $450,000.
    -Lawyer Feed: You will need a lawyer to conveyancing of your home. They complete the final paperwork and transfer the legal title of the home to you. Costs here range, but a good estimate is $1000-$1400. Again, not a mortgage cost, so something you need cash for.
    -Inspection: Depending on the property, you likely want to have it inspected before completing a purchase. Ranges from about $300 - $1000. Condos are generally cheaper, larger homes cost more cause there's more areas to inspect.
    -Moving costs: obvious, but still something to keep in mind.

    Those are the most general upfront costs you will need at the time of purchase, that are not associated with your mortgage and amortized over time and payment. They are costs you will need to have cash type funds available for at the time of purchase.

    Other's to keep in mind:
    -HST on New Homes: New homes, or substantially renovated home(considered new again) are subject to HST. There are rebates in place for the HST that depend on the price of the home. All homes get a 5% rebate on the 7% provincial portion of the HST up to a maxium of $26,250 which is reached at homes priced $525,000. Homes above that still get the $26,250 rebate but no more.
    There's also rebated on the 5% federal portion of the HST for homes up to $450,000.
    Important not on rebates: Most mortgage brokers will only finance Net sale price after rebates are calculated. What this means, is that you may have to pay out the full 12% HST in cash, and wait for the few months the rebate takes. This can be difficult if you don't have a lot of extra money around. Some developers take on this cost for you though, and take the rebate on themselves.
    An important thing to look at if you're buying brand new.

    -CMHC insurance. If you are putting down less than 20% down payment, your mortgage is consider "higher risk" and required insurance. This is usually a few thousand dollars tacked on to your mortgage cost and paid off over time with you mortgage payments. If you're up to 20% in your down payment, you likely do not need CMHC insurance (though some exceptions apply).

    -Realtor fees? Generally Realtors are paid out through the seller, and there is no direct payment made by the buyer. Some realtors though may ask a buyer to sign a guarantee of a minimum commission which the buyer would have to pay any difference. This is incase you decide to buy a property that offers much less or no commission compared to others, and a Realtor you've been working with for a while gets no/little pay.
    It's a rare practice though, and certainly not something I do.

    -Mortgage appraisal cost: Often a mortgage broker will need to send an appraiser to the property valuate it before lending money on it. This is to make sure it's worth what you paid for it, and they're not lending too much money on something with far less value. The cost of this appraisal is often covered by the mortgage broker, but sometimes charged to the buyer. It's something to negotiate with your mortgage broker of choice.

    That's most of the general ones you'll need to be aware of.
    It's good to share this info in the general forums, but if you'd like more specific info for your situation please feel free to send me a message. Happy to help if I can.
    cheeseshredder likes this.
  6. mz_angel

    mz_angel Junior Member

    Hi APReal,

    What do I need to do in order to buy a house in Washington? Are there any good pre-sale condos coming up in Vancouver? Thanks so much!
  7. APReal

    APReal Junior Member

    Presales is an area I specialize in, & there's a few coming up that I find particularly interesting.
    -Alexandra on Davie & Bidwell. http://vancouverpresales.com/alexandra/
    There's not often new developments in the West End, despite the fact that it's one of the most densely populated neighborhoods in North America. I think this development will get both very quick sales & opponents who don't like to see a lot of change in the West End. Also interesting that it's a combined Development by Concord Pacific and Millennium. I wonder if Millenniums issued with the Olympic Village have made them want to team up with the Reputable Concord on this one.

    -Mecannica in the South East False Creek/Olympic Village area should be interesting as well. It's by Cressey, and not far away from their James site, so I'm curious to see how they differentiate it and price it. http://vancouverpresales.com/meccanica/

    -Current ones I like are Maddox, Central, Kits 360 & 6 & Fir. They're all selling now, with 6 & Fir officially opening tomorrow (Aug 6).

    There's many more coming down the pipeline, particulary more near the Olympic Village and around the Burrard & Granville Bridge corridors into downtown. There's not much land left in Yaletown, so most presales will push as little West towards Granville/Howe/Hornby/Burrard. I expect a lot of change in that area. We've already seen The Mark, Maddox, Salt & Rolston push over that way.

    You can always follow VancouverPresales to keep up on what's coming up. I update it all the time & send monthly newsletters to subscribers. Sometime we get special discounts as well, just had one for Maddox.

    I don't know too much about buying US properties, but I know you need to determine how you are going to be using it. If you are going to be there over a certain amount of days a year, you will considered a resident and charged income tax. This can result in you paying income tax in both countries.
    If you will be renting it out a certain amount of days a year, you will have to pay income tax on the rental income you bring in.
    Depending on how often you will be using it and how, specific research should be done for your use.
    cheeseshredder likes this.
  8. chrissy1

    chrissy1 Guest

    Hello, iam wondering if Abottsford is a good place to live , Bradner is where i liked to be. I`ve heard there are problems with gangs in parts of Vancouver. :confused:
  9. ema

    ema Full Member

    There are gangs everywhere, you can find them anywhere everywhere in Vancouver. Just cause the news reports more about Surrey doesn't mean only Surrey has them.
  10. APReal

    APReal Junior Member

    Do you mean gangs in parts of Abbottsford? or you want to live there, to avoid Vancouver gangs?
    Abbottsford has had it's share of gang issues, but so has much of the lower mainland. Either way, there's nice area on both.
    I haven't spent too much time in Abbottsford, but have thought it to be a decent city when I have. I sold one building there a couple of years ago, and the buyers were all very nice people, and the location was peaceful and nice.
  11. chrissy

    chrissy Full Member

    Hi ,
    Bradner is where we were looking as the estate agent said it was a good place, coming from the UK we dont know of the area, but the farms we looked out were great, but dont want to live somewhere with my kids and be worried the school have lots of problem, e.g gangs and drugs, and not feel safe .
  12. APReal

    APReal Junior Member

    I would suggest the main thing to consider is how close you want to be to Vancouver. If you're in the UK thinking "we should move to Vancouver" and then end up moving to Abbotsford, you haven't moved to Vancouver at all.
    If you're looking to experience Vancouver, come to Vancouver.
    If you're looking for a quiet farm, away from the big city then Abbotsford might be for you.

    As for gang issues, it's something you should consider as a parent. I'm neither a parent, or Abbotsford resident, so I unfortunately can't comment with much experience.
    Maybe make a topic in the general discussion section about Abbotsford, and raising a family there? There's likely some Abbotsford people on here that may see that and offer better feedback. Good luck!
  13. Hamburgler

    Hamburgler New Member

    Why doesn't Vancouver or even BC get some foreign ownership limitations so that the average Canadian can afford to live here?
  14. APReal

    APReal Junior Member

    Most of the "foreign" owners are actually Canadian residents, not foreign owners; so I guess immigration control would be what you're after, or controls on how many properties all investors can buy.
    That's a political issue for another thread, though I do understand and relate to the difficulties of ownership of your average wage earner.
    Especially young people like myself who didn't have the benefit of built up equity from previous homes.
  15. Hamburgler

    Hamburgler New Member

    Actually I mean specially foreign owners, not new Canadian citizens or immigrants. There are several realtors now who specifically represent off shore investment buyers.
  16. milquetoast

    milquetoast Senior Member

    I don't think foreign owners have as much of an influence as people think. It's the new immigrants with businesses in the home country. They make their fortune back home and use the money here.

  17. ema

    ema Full Member

    Ah, you mean those from Mainland China investing in West Vancouver homes cause China's policy on having too many homes is ridic? lol
  18. APReal

    APReal Junior Member

    Agree with Cheeseshredder. It's hard to find stats on these things, but the studies and first hand experience I have indicate a very small % of actual foreign investors who don't live here, or have Canadian residency.
    There are a fair amount of wealthy Mainland Chinese who buy lots of properties here with wealth coming in from China, but they also raise their families here, put their kids through school here etc.

    Anyhow, wealth class immigration has always been something Canada tries to encourage as it brings money into the economy and creates job/economic growth. Of course, there's always people who disagree with as well, but it's a political debate not a real estate debate.
  19. Hamburgler

    Hamburgler New Member

    Umm.. yes, and its not just HK and China and not just West Van.

    Aside from the absurd idea that these foreign owners are creating wealth (they pay taxes in their homeland, and other than the PTT,reator fees and luxury cars, they are not producing jobs or adding to the Canadian/BC tax coffers) here, they are contributing to Vancouver becoming a resort city for the uber-wealthy, preventing the average Canadian (recent immigrants included) from owning property.

    I was hoping for a straight up or insightful answer but instead got the standard realtor cliche.
  20. APReal

    APReal Junior Member

    You mean you were hoping for people to 100% agree with you, start complaining about foreign investment, and join you on your little rant?

    What was cliche about my answer? I agreed completely about the un-affordability of homes for many locals & also agree Vancouver is becoming a city for the uber wealthy.
    The only part I disagreed with was that these buyers aren't Canadian residents, paying taxes into our economy, starting business that create jobs & overall making contributions to our economy.
    Not everyone who disagrees with something you say (without any facts to boot) is being "cliche".

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