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Michele Talks BC Real Estate Regulations and Buyer Protection
July 12, 2022 | Posted by: Michele Cummins
Warning! This is a digitally automated transcript, so there will be mistakes throughout! Including Michele's name :)
Curtis Pope:
One thing that means is time for the company's Real Estate Group show with our local Rockstar realtor Michelle Cummings and myself Curtis Pope. Good morning.
Michele Cummins - PREC:
Good morning. I'm gonna take a mommy Nina's hazard. Quote, but anyways, good morning, Mr. Pope. How are you?
Curtis Pope:
I am wonderful. It is great to be here on a rainy weekend looks like we're gonna get rained for like the next, you know, three months now next week anyway. But hey, that's what we get living on the West Coast.
Michele Cummins - PREC:
That's right, tropical climate that we have. But I'm looking at my window right now. And I do see ferns which I'm really happy for. Because, you know, shortly soon enough, there's going to be they're going to be covered by the blackberries that have taken over the invasive species. So I love seeing ferns. I love green. So I'm okay with the rain. But I can't believe it's already in the middle of March. Like we were just saying, hey, it's the first show of the month. It's already the beginning of March. Can you believe it? And now it's the middle of March.
Curtis Pope:
Yeah, I know. St. Patrick's Day is coming up fast. And before you know it, it's it's like spring break for the kids here and stuff now too. It's like it's crazy.
Michele Cummins - PREC:
Yeah. Oh, yeah. And tonight, don't forget to spring forward your clock.
Curtis Pope:
Exactly. Yeah, you don't want to wake up and be that person that's, you know, completely out of whack for like, a whole day or two.
Michele Cummins - PREC:
I've done that. I think once in my life, just once. Well, you know, I usually set two alarms, just to make sure, but then I always second guess myself. And I'm always second guessing myself during that whole next day, because I'm like, Yeah, but did everyone else spring forward properly? So are all my appointments gonna be messed up? So I'm always that day is a little bit, you know, I live in peace, hopefully. But it's a little stressful anyway.
Curtis Pope:
Well, I know with cell phone technology, they all they automatically adjust for you. So really, we we don't have the excuses we used to have.
Michele Cummins - PREC:
It's true. So okay, so I had a really cool event. On Thursday, I had my first homebuyer seminar that I hosted, along with financial planner, Brandon Kirk and mortgage broker, Jessica Oates, who have both been on our show. And we had a Zoom meeting. And we had a couple of giveaways. And it was a lot of fun. We had great questions and answers. And it's our first it was our first one of of real estate wise webinar series that we're doing. And we'll have a webinar once a month. And our first one was last week. So so excited, that was on the six steps to buying a home for homebuyers, and I'll be posting that video on my YouTube. So check it out there as well as my social media for anyone who missed it. But next month is our first one for our sellers series. And it will be at 7pm via zoom on April 14. And yes, we'll have some more giveaways. So be sure to register for the Zoom link. So you will see that and I'll be posting it on my Facebook business page probably in a couple of weeks. And so yeah, so every month I'll be doing one and the one after next month will be for investors. So keep an eye out on it. It's yeah, it's a blast. I've had a crackdown and decided to do
Curtis Pope:
it. Very cool. And just another resource for people that have interest in real estate in the industry to learn more about it.
Michele Cummins - PREC:
Yes. Oh, and can I do a call out? No, you may
Curtis Pope:
not. Of course you can do it anyway. I'm not going to stop you, you know that you're just gonna do it anyway.
Michele Cummins - PREC:
So I'm looking for service providers trusted and good, reliable, professional service providers, so business owners to partner with and helping each other's customers and clients. So if you're out there and you hear this or you know of somebody I have need for painters, for plumbers, renovation experts drywallers cleaners like house cleaners moving move out cleaning photographers, stagers and designers. So if you are wanting to grow and help each other, please contact me and if you know anybody that would like that as well. And I've got an announcement. So this announcement, it's about the Bank of Canada of the BOC. And they are meeting on April 13. And guess what? They're going to raise the interest rates another quarter percent. They say they had mentioned that they were going to do it in June. But no, they're going to do it April 13. So if you are a buyer and you're not pre approved, or your pre approval will end before then please get out there, find your mortgage broker and get pre approved before April 13. So that you don't affect you.
Curtis Pope:
That's probably a good call. Because yeah, that's, you know, we just went up a quarter percent, now we're going up another quarter percent, that's going to add up pretty quick.
Michele Cummins - PREC:
It does. And it makes a big difference in the pocketbook of what you can afford. And then that you know, the purchase price is today. So, yeah, so I just found out, you know, I have my place in Oregon on the Oregon coast, and my nephew is getting buried there next month. That's so exciting. And I found out that Oregon, you know, how buyers you know, to really stand out, one of the things that they do is write a letter of love to the seller and their property, you know, to try to get their foot a little bit better in the door to try to reach the sellers emotional side to hopefully choose to work with them over the 10 other offers they received. Well, Oregon had banned a judge actually, by her love letters. Yeah, I can you believe that? I couldn't believe it. They actually said it's because it was discriminatory. But then they that people were fighting it because they were saying, but it's also who was against free speech. I just can't believe that you, you wouldn't be allowed to write a letter to somebody, I really
Curtis Pope:
love a property and you want that person to know that you're going to take care of it and that you want to, you know, you know, you love what they've done with the renovations or things like that. Why wouldn't you want those people to know that?
Michele Cummins - PREC:
Yes, exactly. Like how, how I just I just can't believe it. Like if a buyer wants to write a letter to a seller, have that or you should have that ability, but Washington state is actually trying to I heard as a second state to try it. I don't think it's going to work out as it didn't seem to work out for Oregon. But that was interesting. Okay, so we got to get into our first topic though here. Okay. That kind of brings me into a policy of policies of government and realtors are trying everything we can do to help real estate REITs locally are local governments and our provincial governments and our federal governments. But there's this seven day rescind period for buyers that the government's talking about. And so the for I go any further, I just wanted to say if you don't know about it, it all it just explained it here. So bcrta, which is the British Columbia Real Estate Association in hand with the local real estate boards and realtors. We we've published more than 30 recommendations to the BC government and the provinces real estate, regulatory, the BC Financial Services Authority to help guide their decision making to better protect consumers in the real estate transaction progress progress. So a key recommendation that we made is for the government to mandate a pre offer period instead of a cooling off period to improve the home buying and selling process and mitigate consumer risks in this competitive market that we've been in so realtors, for realtors, it's very important for us to under understand and know what that is and to explain it to our clients and customers. So the consumers. What's the difference between a pre offer period and a cooling off period will a cooling off period give buyers the right to withdraw so as purchase agreement within a specified period of time after their offers accepted. The objective of this policy is to allow buyers time to reconsider their decision after having their accepted offer. Although the government has already announced its intent to implement a mandatory cooling off period, our research has led us to have significant concerns with the policy. Instead, we're proposing a pre offer period which would mandate that a listing be available for a minimum of five business days before offers are allowed to be presented. This would provide prospective buyers with the opportunity to undergo due diligence, giving more time to ensure proper financing is in place, reviewing any documents and disclosure statements and conduct a home inspection before submitting their offer. A pre offer period will allow potential buyers to ensure that they are making offers that are well informed while also reducing pressures of the highly competitive real estate market. So already many, many realtors and sellers has had a holding off period, they just signed a form saying we're waiting to present any and all offers until this day and this time, which typically has been five to seven days after they list. So already they're giving that timeframe for the buyers to do all their due diligence within that period. And that's the market that we're in but this cooling off period. Okay. Why the difference? Because a key difference between the two policies is that the cooling off period it's reactive, allowing potential buyers to reconsider a decision after it's been made. While a pre offer period is proactive allowing due diligence to meet to take place before an offer is made. So potential issue with a cooling off period is that if a potential buyer misses their offer, it may create a cascading effect, which would jeopardize the sellers ability to purchase their next home. A cooling off period tries to protect buyers but doesn't consider that men buyers are also sellers. And if their own home sales falls through as a result of a cooling off period, their own home buying efforts could be jeopardized. A pre offer period avoids this unintended consequence by taking place before and offers made. Another potential negative consequence of a pulling off cooling off period is that it may increase the total amount of offers ultimately worsening housing affordability. Sophisticated and wealthier buyers may take advantage of a cooling off period presenting offers on multiple properties to preserve preserve their options, and later backing out of all, but their own preferred deal. This already happened with a lot of properties, and this would just facilitate it even more, and it's not good. If this occurs, it would increase the instances of multiple offers. This resulting increase in demand from insincere or frivolous offers could offer further increase housing prices, a pre offer period would not give opportunity for these frivolous offers. It's important that serious buyers feel confident in their offer and on the property and that can only happen with due diligence completely beforehand. So that is what we as a Real Estate Association is is trying to express and get out there and let the government know maybe a better way to consider trying to help buyers and to buyers or sellers. Most of them
Curtis Pope:
all right, well, it makes perfect sense. Okay, so we should probably take a quick break here. If people want more information about your listings about the services you provide as realtor where can they go?
Michele Cummins - PREC:
Yes, actually they can go to Miguel cummins.ca and to actually find out more or to fight promote this better way to purchase homes in DC is hashtag Better Way Home DC
Curtis Pope:
perfect. We're back with more right after this. So number two Cummins Real Estate Group show with the soul Cummins and myself Curtis Pope. Now, Michela, you're talking a lot over the last two, well, couple of years about how we need more housing in British Columbia. And I know that's really coming to a head right now.
Michele Cummins - PREC:
Yes. And for a second. I thought he was gonna say, Michelle, You sure talk a lot.
Curtis Pope:
No, that's for people to comment on our YouTube page. My favorite comment ever you guys talk too much.
Michele Cummins - PREC:
Oh, we don't want any dead air here. Exactly. Yeah, VCs housing supply, it really needs to increase now. Not tomorrow. Not next week, not next year. Now. It really that. So the fact that we here in BC. I mean, we just were not nowhere near the supply to meet the demand that we have. So, for example, march 2021 67,000. Buyers searched for homes across BC, while only 24,000 homes were listed for sale. I mean, those numbers like that's crazy. So the the disparity between the housing supply and demand will continue to rise as the federal government resumes its immigration program. And this year alone, the Government of Canada aims to welcome more than 400,000 new permanent residents 70,000 to 80,000 are expected to settle in BC the province already has domestic demand that it can't meet. BC is already home to four of Canada's fastest growing cities. That is Kelowna, which I call the Palm Springs in Canada Chilliwack Believe it or not Chilliwack, Kamloops and a Nymo. So the CIA's research shows that the You cities have a $1 million benchmark for a single family home or townhome. As the demand for housing grows while supply continues to lag behind the pressure on potential homebuyers will only worsen. Moreover, British Columbians whether they're homebuyers are renters, they need options in housing types. Building out middle housing such as duplexes, triplexes, fourplexes, laneway, and secondary suites can create a much needed diversity in the housing stock. The diversification and densification of housing are central and cities and transit accessible population hubs. When there's such a mismatch between supply and demand, it's no wonder that multiple offer scenarios and even subject free offers are just the norm. So BC Realtors support more transparency. So this whole episode we're talking about government policies and how BC realtors are moving forward with suggestions to the government to help for real estate REITs and policies. So that's why the professional association for VCs 24,000 realtors, the BC Real Estate Association, which we call bcrta, has submitted a white paper A Better Way Home, protecting consumers and real estate transactions to the BC government with more than 30 recommendations as mentioned in the first segment to improve the BC real estate sector and better protect consumers. And on our show, we talked about the first one the first segment, this is a second one that I wanted to bring forward because it is so important. In our recommendations, we urge the provincial government to make infrastructure investments to local governments conditional on official community plans, housing needs, report, zoning, bylaws and other local policies to allow for increased density and a mix of housing types, to put simply, to speed up and increase housing, diversity and start. So we have also suggested the creation of a permanent national housing roundtable in coordination with the federal government to bring together all housing market stakeholders to help address these challenges in an integrated manner. So our other recommendations include making property disclosure statements mandatory, making all strategy documents available upon listing and giving buyers more insight into multiple offer scenarios. informed decisions instead of regret. The mismatch between potential homebuyers and available properties means that there are a whole lot of frustrated British Columbians who have been unsuccessful in their home buying journey so far. According to a survey of unsuccessful homebuyers in DC since January 2021. By far, the most common reason for an unsuccessful purchase was competition from other potential buyers. That was 49% followed by inadequate financing which was 31%. Similarly, among concerns expressed by successful homebuyers, the largest was pressured to make an offer uncomfortably above the list price to be competitive. I'm surprised that's 22% Because it seems like it's 99.9% to me, but that's what the survey says 22% with fierce competition between buyers, subject free offers and risky financial decisions are being made without proper due diligence. Often buyers prepare an offer 48 hours after showings. And it's done without an appraisal inspection or sometimes even without reviewing strategy documents. Like Like so many stories that that that I have heard, making subject free offers. And that's why our first segment talks about the pre sale period where sellers can hold off or should hold off at least minimum five days before looking at offers to give hires a chance to be able to have an opportunity and do their due diligence. So the current real estate market and what it has meant for buyers and sellers have been people just everyone's worried, from consumers to governments, to realtors. The BC government in particular has taken notice so concerned that consumers are making increasingly risky decisions. The BC government has said it will introduce a mandatory cooling off period as I mentioned in real estate transactions this spring. a cooling off period would allow buyers to change their minds and cancel a signed purchase and this is just not good. There's a lot of legal consequences likely having the seller in a difficult situation particularly if they're buyers again of another transaction is just it can snowball from there. And again, this reminds me of how the government came out with the foreign buyers tax without thinking anybody in IT firm accepted binding contracts purchase and sale for certain price shouldn't after the fact be surprised of this huge fee that they have to pay. So sometimes when they roll things out quickly, and without getting the right advice by the stakeholders that are in the heart of it, and it's things can go wrong, so we're asking them to cool cool off themselves a bit. Bit back and let's have more tasks. Let's force let's let's get together and chat more about this. And before that happens, so we want that free offer period, at least we find that that would be a better suggestion. But also who knows how long this type of multiple offer situations gonna last? You know everything for a time? And do we really think that this is going to last forever and ever and we're always going to see multiple offers, you know, this is for your time, you know, so let's look at that as well and not be so focused on just what's happening today. But understand history understand human human nature, psychology and, and the lookout of the future and you got to look at everything, not just what's happening to you today. You have to be able to react with wisdom, knowledge, understanding and and peace of mind for sure.
Curtis Pope:
Let's have a look at some new listings. There's one at 36228 cascade Ridge Drive and mission $1,198,900 It's a 20 475 square foot home on 2.47 beautiful acres with a detached garage and workshop koi pond firepit zipline it's a must see also a new listing at 4636 Princess Aven Chilliwack 700,590 $1,800.18 100 and 72nd square foot three bedroom one bath home with detached garage, private backyard and an easily tweetable on a quiet no through street at 9263 Hazel Street and Chilliwack there's another place for $749,000 Cozy 929 square foot two bed one bath with updates and detached workshop fenced backyard and in a central location. Also there's a hazel street land assembly in Chilliwack. This is a five property land assembly that makes up 29,841 square feet. It's already zoned for low rise apartments. central location priced at $4,425,800. Please call Michelle for more details. We have a price reduction at 30150 Keystone admission $2,595,000 dropped 100k Incredible seven acre property or Haywood Lake 20 860 square feet four bedroom four bath log home with a suite 900 square foot detached workshop in ground pool horse barn, great views and also we have another price reduction at 1479 Highlands Boulevard in Mount Woodside now $1,565,000 from 1.59 8 million. So check it out. There's some great places more details. Michelle cummins.ca. All right. Well if people want more information about what you do as a realtor and they want to see your listings, your open houses all these things, where can they go? It sounds cummins.ca And join us again next week and we will talk real estate in order to unlock your real estate potential on the show real estate is maximized. Thanks for listening
If you missed last week's episode where we replay our episode on commercial real estate, please go take a listen! It's well worth it.