I'm not happy with my previous realtor, who I chose based on a friend's referral. How do find a buyer's agent? 

‘Trust', IE familiarity rather than credentials, experience, or referrals, is quite often the ONLY qualifying criteria buyers will use when selecting a buyer's agent. Buyers also often don't take the selection of a realtor nearly as seriously as a seller does; they SHOULD. The realtor fees are paid from the proceeds of the sale, and while the seller's agent and seller largely ‘set the fee' that will be split roughly evenly between the seller's and buyer's realtor, the funds come from the buyer. So, in essence, both buyer and seller are ‘splitting' this cost. The point here is that buyers need to, for many reasons, QUALIFY their prospective agent and ensure they're confident they're going to get good value for the services provided. It's usually easy to find a real estate agent; it's identifying a good one that is the right fit for you that is a bit more challenging.

I recommend interviewing at least 3 for the job, and finding them by cruising some open houses in the area you wish to buy in. Observe them first, and if you find their demeanor appealing, ask them about the building or property, the area, etc.., but perhaps without letting on you're ‘realtor shopping'. Once you've identified your 3 ‘prospects', call them and invite them for a coffee or see if they'd like to meet you at their office. In about a 20-30 minute ‘interview', you should find out about their experience level and knowledge of the area, get a feel for whether they are more about ‘you' or more about ‘the deal', and also ask them how they get paid. They should go out of their way to make sure you know what to expect and when, find out if you have the best mortgage rate, and educate you in general. You want to feel a good personal connection, and also feel they are professional and have your best interests at heart.

Regardless of how you do get introduced to or ‘find' a prospective realtor, DO put them through the interview process! The substantial professional fee that you will put in their pocket is more than worth it if they protect your interests, make sure you understand the value of what you're purchasing, and overall create a confident, comfortable experience for you as you spend hundreds of thousands of dollars on likely your biggest

Why do different realtors charge such different fees?

The real estate sales/service industry is 'market based' when it comes to fees, and as such, 'typical fees' will vary from market to market, and also within each market. EG; in many areas of the U.S. and in places such as Toronto, there is a 'flat fee' structure that is prevalent; 5% is common. In B.C., you typically will see 7% on the first $100,000 + 2.5% on the balance, which as a net rate against our B.C. prices today, is considerably lower than most North American markets.
Within a given market (eg, Vamcouver) however, is where fee differences from realtor to realtor stand out. Most 'full service' realtors will charge in the range of 7% on the 1st $100,000+ 2.5% on the balance, but this is negotiable. A good realtor should be able to justify and reasonably defend his value; interviewing at least a few when considering selling will very likely show that some are more 'worth' this fee range than others.
There are many discount realty companies and their realtors in the marketplace as well. They will charge much less, but statistics show their net sale vs list price percentage average to be a bit lower, and days on market to be more.
An inherent problem for consumers is that, typically, the agent for the buyer gets paid through the 'listing contract' between the seller and their agent. If the 'share' of the fee being offered to buyers' agents is not competitive, this sometimes hurts traffic to the listing.
The 'cost' of the fees is important, but feeling like your hired professional 'netted' you as much as the market could bring you is the bottom line, regardless of fee amount. You get what you pay for, so interview at least three realtors, and challenge them on their fees, as well as speak to at least a few references. There's a lot more at stake than just the fees!

I keep hearing that the market is ‘balanced' these days; what does that mean? 

Generally, it refers to a market where, relative to historical market norms, there is neither a shortage or abundance of inventory. Conditions are ‘healthy'. Prices are stable, there's few ‘competing offers', sellers need to expect to discount a bit off their list price when negotiating, buyers can expect to have a bit more time and property choices to work with. If a property is priced well, it should still sell quickly, for quite close to asking. Following is a bullet list of ‘identifiers';

• Inventory is normal as compared to previous normal months / years.
• Three to six months of inventory is on the market.
• Comparable sale prices are close to active listing prices.
• Sales numbers have stabilized.
• Median sales prices are flattened.
• Real estate advertising remains uniform.
• For Sale signs are replaced with pending or sold signs within 30 to 45 days.

I want to move up (to a larger, higher priced home), but with the market seeming to be turning downwards, I'm not sure if this is a good time. Is it?

Every situation is different and you should consult with a professional 3rd party about your particular scenario. But, that being said, in general it's usually smart to ‘move up in a down market'. Ideally, you'd be in a situation where you can sell quickly, then be patient when buying. Example; if your current place was worth $400,000 a few months ago at the market's ‘peak', and it's come down about 5%, you're retaining about $20,000 less equity. But, if what you want to buy was worth $700,000 at market peak, and it also has of course come down 5%, you're saving $35,000 on the purchase, for a net savings of $15,000. This ‘spread' can become quite significant depending on the price ranges we're talking about.

If the market has moved down even further between when you buy and when you sell, you can of course possibly increase this ‘spread'. Currently, conditions are good for exercising this type of strategy; the market is turning and will likely continue to do so for a little while, and rates are likely to stay low.

I'm not comfortable with competing offers, but am fed up with missing good properties. How do I cope with competing offers? 

In our market, if a buyer is to increase their chances of success, it's important that they familiarize themselves and gain some comfort with the concept of competing offers. A good property that is sharply priced in a market segment that is at least somewhat active is bound to get multiple offers. Buyers must ‘court' the seller more than ‘negotiate'. Success will be had by the buyer with the best combination of price and commitment. Emotional deterrence to competing offers can be costly; hopefully the below helps you create a frame of reference that helps to develop an objective approach! Buying a home can be emotional; the process itself is short, however, and the reward almost always very long-lived. 

PRICE

The first concept to embrace here is that there are three numbers to consider when writing any offer; list price, market value, and value to the buyer.

1) The List Price; this is an ‘invitation'. If there's lots of activity, it's clearly a good invitation and likely well (or under) priced. Once it's gotten you ‘in the door', it's best to largely ignore the list price, and any emotional deterrence you may have to ‘paying over list'. It was simply an effective part of the marketing strategy the realtor/seller used to bring the property to the right buyers.

2) Market Value; currently and recently, what are very similar properties selling for? From this data, you and your realtor can come up with a clear idea of current market value. From this information, and how it relates to the list price, one usually sees a correlation to the activity and how many offers are rumoured to be coming in.

a. EG #1; if market value is between $480,000 and $500,000, and the list price is $500,000 but there's still lots of activity and many offers coming in, the market is clearly ready to move the market value up; by how much is difficult to gauge (see next bullet for more on this).

b. EG #2; assuming same market value, but a list price of $475,000 and only two offers, it's reasonable to assume market value is holding fairly steady, and the seller is either motivated, under-priced, or intentionally trying to generate multiples. It may not even take over asking to ‘win' if the market itself is a little ‘flat'. The examples could go on, but hopefully the gist is clear.

3) Value to the Buyer; the most important number. There's more to competing offers than picking a price, but it's of course the most important part of the process. In most cases it's best to expect that there will be only one chance to ‘win', so you'll need to commit to a price that is equal to, or just a bit more than, what would be the top number you'd be willing to pay for the property were you not competing.

a. EG; market value is clearly $480,000 to $500,000, list price is $499,000, and there's 4 other offers. You love the property, are comfortable ‘pushing the market up', and could spend up to $550,000 from an affordability standpoint. At $520,000, you feel a bit pressured, but would kick yourself if someone else bought it for $521,000. So, perhaps $522,000 would be the number.

COMMITMENT

To be competitive in competing offers, one must consider commitment as well as price. ‘Commitment' refers to the conditions or subjects. These are usually financing, review of documentation, and inspection. When not competing, it's usually agreed by buyer and seller that the buyer will have about a week to satisfy these conditions, within which the buyer can walk away at any point. So, the seller is committed, but the buyer isn't for a week. When competing, a buyer's ability to shorten, omit a few, or even omit all conditions greatly strengthens their offer relative to others, as the seller will be concerned that should a buyer walk away during this conditional period, they will have trouble generating the same price again. These efforts to shorten/omit subjects usually involves hustle, and a good realtor experienced in these situations will help greatly in determining the maximum ‘commitment' you can safely and comfortably provide in the shortest time possible.

There are other tools that can aid in competing offers, but the above provides a good overview. The strongest a competing offer could be is one with the highest price, no conditions, dates left up to the seller, and deposit cheque in hand at time of offer. Buyers competing need to come as close to this ‘benchmark' as they comfortably can or are willing to in order to know they've given themselves their best chance at success. You and your realtors' job will be to find this point and take your best swing.  

Aftermath; if you win, you may feel you paid too much- it'll be important to remember you've ‘pushed your own market', most likely to your own benefit. If you are close to the best offer, you MAY get a second chance and be asked to pay a bit more or provide a bit more commitment. If you lose, especially by a small margin, it's common to kick yourself; this is why it's important to feel your taking your best shot when you initially submit the offer.

How do I know if staging will be worth it?

It's virtually impossible to know exactly how much return a seller will get for any dollars spent on staging, however, statistically speaking, it's quite rewarding. With staging, it's not so much about being able to increase the list price relative to similar properties; it's more about how much CLOSER to the list price (ie, higher net sale price), and how much more quickly, a listing will sell. Quick analogy; say you have two $100 bills in front of you. One is fresh off the printing press, crisp, clean and shiny. The other is old, crinkly, one corner taped in place. They're both worth the same, but we know which will be picked up first, 9 times out of 10. We've seen examples of pretty much identical apartments in the same building, listed at the same time for almost identical prices, one staged and one not, where the staged unit sold for $1,000's more and much more quickly than the non-staged unit. In a nutshell, it's almost always a good investment!

What is the best time of year to sell?

There's general market cycles to consider here, but what you're selling is also a factor.

· Vancouver market cycle; typically, mid-November to early March sees the least activity, mid-March to May/June sees the most activity, summer is slower, and fall is busy again though not as busy as the spring market.

· What you're selling; it's important to get an idea of the ‘competition'. If it's the heat of the spring market, but there's 30 listings very similar to your property in the area, it may not be a great time. Conversely, if it's November but there's nothing on the market like your property, and the last comparables sold in multiple offers, then it could be a great time to strike. Another consideration could be outdoor space; a home with a great patio, a view roof-deck, or outstanding landscaping is much better presented in late spring, early fall, or even summer.

Bottom line, consult with a professional (or two; comparison is good) , and make sure all factors are considered.

I'm a buyer, and I've heard mixed information about whether it's free to use an agent or not. Please explain.

The common perception seems to be that a buyer's agent works for free for their client, or is paid from the fees paid by the seller to their agent; ie, at no ‘expense' to the buyer. This view is somewhat semantic; usually, at the end of the day, the buyer pays one amount, and the seller nets a lower amount, with the difference going towards realtor services. If you pay $400,000 for a property, and the seller will net $386,ooo, this means $14,000 is paid for real estate fees; feeling that this money is well-spent should be as important to a buyer as it will be to a seller. To that end, a buyer should interview at least two buyer's agents before choosing one to represent them. A good buyer's agent will be able to convey value for their services, should instill confidence in you that you will be advised competently, and should demonstrate strong market knowledge.

*Note; currently, buyers do have the choice to negotiate with and hire directly a buyer's agent, cutting the seller and/or seller's agent out of how much they pay their professional representative. In the future, it's our belief that this will be commonplace; it's become mandatory in a few regions of North America. Today in BC, buyer's agents have legal/fudiciary obligations to disclose their fees from the seller/seller's agent, protect their clients best interests at all times, etc..

When is it a good time to buy?

This really depends on an individual's needs and goals, and how they relate to factors such as a rising or falling market, interest rates, etc., etc..  It's always a good time for some people, and not a good time for others. A good first step to figuring this out is to verify your spending potential (meet with a mortgage broker and/or financial planner, etc.). Next; consult with professionals! There's an absolutely massive amount of information and advice available online, in publications, etc.., but nothing beats sitting down with a few different professionals who will listen to your situation and shed light on your options. Our advice is to consult with a few different realtors before committing to one.

How do I find out if a condo is leaky?

Primary indicators can be the time-frame the building was built in (most were built between early '80's and late '90's) and it's general construction style (eg, woodframe with stucco-clad exterior is most common), however diligence is also required to get a truly accurate picture; eg, a building matching these criteria may have had it's exterior updated (ie, rainscreened) at some point. An experienced local realtor should have a good handle on which buildings in the area are suspect, as well as have the resources to quickly investigate unfamiliar buildings. Other tools for diligence, in the case of a purchase scenario, would be strata minutes, engineering reports,  owners' disclosures, and a buyer's own Professional Inspection. It's very important to note that even in the case of a building that has had 'fixes' or been 'fixed', there could still be risks. A buyer needs to match their own risk profile with the facts they can discover about that which they're considering buying; typically, the lower the risk (ie, built since about 2002, rainscreened, still under warranty), the higher the cost. To build your own frame of reference, check out these sites;

• www.choa.bc.ca/
• www.hpo.bc.ca
• www.cmhc.ca/publications/en/rh-pr/tech/03-108-e.html  (a favorite link of ours...)

As a group, we have developed a high level of knowledge regarding building envelopes, suspect buildings, etc.. Calling one of us is a highly recommended way to get a quick answer.

How does the HST affect me as a buyer?

This depends on whether you're buying new, or resale. In both scenarios, you'll pay a little more tax on associated services (HST for lawyer fees, inspector fees, etc..). In the case of a resale property, other than this relatively minor factor, it will not affect you; there is no HST charged on the purchase price. When buying a new property, prior to HST, you would have paid 5% GST on a purchase price of approx. $500,000 or more, with substantial discounts available in price ranges below this. With HST, purchases are subject to 12% HST minus a discount of 71.43% off of the Provincial portion of the HST (7%), with the availability of this discount maxing out at a purchase price of $525,000. This means that a purchase at any amount over $525,000 will receive a flat discount of $26,250 off of the 12% gross HST. Any purchase below this will receive a proportionately smaller discount. For more information, refer to; http://www.sbr.gov.bc.ca/documents_library/notices/HST_Notice_003.pdf