What is Buyer’s Remorse and How Do You Get Over It?

You’ve been viewing homes for a while now and finally bite the bullet and submitted an offer on a home. Your offer is accepted and you go to bed that night elated and excited. But then, you wake up the next morning, asking yourself troubling questions:

Did I spend too much?

Is this the right place?

Do I even want to move?

Buyer’s remorse is something nearly every new buyer experiences; good agents will even warn their clients about it ahead of time.

Why does buyer’s remorse happen?

Buying a home is likely the largest purchase of your entire life. It’s a lot of money, a lot of responsibility, and a lot of debt. For most, it’s a long-term decision that locks you into one location, so there’s a loss of (hypothetical) flexibility, options, etc.

Even just writing this, I feel a little anxious—and that’s completely normal.

People get buyer’s remorse when buying a turtleneck, let alone a house. It’s human nature to question your purchases, especially when they’re a lofty expense.

Know what you want

Your agent will ask you in your first consultation what you’re looking for, what your dealbreakers are, what you must have versus what you want to have, etc. Be very honest with both your agent and yourself about these details.

If you’re viewing homes with two-car garages, for example, you put in an offer on one of these homes, then think after it’s been accepted “Did I really need that garage? Did I pay extra for it?”, you’ll experience strong remorse because you weren’t being truthful with what you need.

Make a list of details—large to small—then edit it and rewrite it, until you have a list that’s accurate. Your agent should be able to help you assess your needs and wants.

Understand your finances

Paired with your needs and wants, you should know exactly how much you can afford. Determine monthly payments, max mortgage affordability, your down payment—all of it. You might need a four-bedroom home but can only afford three in the area you’re exploring. Instead of stretching your finances to meet that four-bedroom house then regretting it later, reassess—either downsize or find a four-bed in a less expensive neighbourhood.

I’ll stress again that this is a financial commitment, so don’t overlook this step. Just because you were approved for $800,000 doesn’t mean you have to spend every penny.

Tell yourself it’s going to happen

Before you put in an offer, even while you’re looking at homes, remind yourself that you may feel remorse, even if you’re in love with every aspect of this place. The more you acknowledge that buyer’s remorse is going to happen, the less surprised and affected you’ll be when you actually experience it.

Be very confident during bully offers

A lot of buyer’s remorse occurs after bully offers are accepted. Bully offers are early offers in a competitive seller’s market that encourage the seller to accept before offer night, meaning before others have had a chance to draft an offer and submit.

Buyers have to get their offers together quickly to submit bully offers, which means you’d have less time to stew and make a deliberated decision. When submitting a bully offer, you have to be sure you know this is what you want. If you feel rushed—more rushed than you’re comfortable with—you may feel regret the next day, for having not considered certain things.

• Common questions after a bully offer:
• Did I pay too much?
• Would there have actually been other people interested?
• Would I have actually had to compete in a bidding war?
• Was I rushed into believing this is what I wanted?

If you see a home and are considering a bully offer, work with your agent, your partner, or someone you trust and talk out your thoughts. Write them down. You don’t need a week to decide if you want a certain property, but you do need to address your concerns.

A seller can also get remorse after a bully offer, as they may have had other interest that couldn’t get an offer ready. Sellers have to determine if the offer presented early is actually better than what they could get in a bidding war. It’s a tough call, but sometimes accepting bully offers is the way to go.

There are repercussions to backing out of an offer

If your buyer’s remorse is so bad that you have to back out of your offer, it’s easier said than done.

Once your offer is accepted, your agent has to speak with the listing agent to see if they had other offers. If they did, there’s a chance the runner-up bid will purchase the home. That said, if the sellers receive less than your initial bid, you may be required to pay the difference. And if they don’t receive a second offer at all, you’re in trouble.

In any of these situations, the sellers can take you to court; litigation can last for years and can be extremely costly.

Buyer’s remorse isn’t a fun feeling, but it happens to everyone. Be honest with yourself, be open with your agent, and talk through your thoughts and concerns with people you trust. Typically, people get over their remorse in the first couple days, once they realize the decision is exciting despite their worries, and they can focus on moving, upgrades to the home, and starting a new life in their new place.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source: Zoocasa

BC government introduces “cooling off” period for home sales

 

On July 21, the provincial government introduced a home buyer protection period, the details of which are outlined in a new regulation that allows home buyers to back out of a residential purchase up to three business days after signing a contract.

The government began to enforce this regulation starting January 1, 2023.

The province claims this three-day cooling off period will help ensure all homebuyers have an opportunity to conduct their due diligence, such as securing financing or arranging home inspections.

Key facts

The homebuyer protection period basics

• The period is effective January 1, 2023.
• Buyers will have three business days to back out of a residential purchase after signing the contract.
• This applies to all contracts, regardless of subjects. 
• The period is mandatory and can’t be waived.
• Buyers who back out of a contract within this three-day period will have to pay a rescission fee of 0.25%. For example, if the purchaser exercises the right of rescission on a $1-million home, they’d be required to pay the seller $2,500.
• The rescission fee is paid to the seller.
• The enforcement mechanism for the rescission fee, and for any deposits that may need to be returned, is unclear at this time.
• Realtors must provide general information on the period to all clients through the Disclosure of Representation in Trading Services.

Deposits

If a deposit is held in trust, brokerages may release it upon rescission.

If there’s a balance, it’s returned to the buyer, regardless of what’s provided in the contract.

Exemptions and waivers

While the period can’t be waived, there are narrow exemptions, including sales:

• Subject to section 21 of the Real Estate Development Marketing Act.
• Of residential real estate located on leased land.
• Of leasehold interest in residential real estate.
• At auction.
• Under a court order or supervision of a court.

Residential real estate defined

• The homebuyer protection period will apply to:
• detached homes;
• semi-detached homes;
• townhouses;
• apartments in a duplex, triplex or other multi-unit dwelling;
• residential strata lots;
• manufactured homes that are affixed to land; and
• cooperative interests that include a right of use or occupation of a dwelling.

The new period doesn’t apply to presale properties, which already subject to a rescission period under the Real Estate Development Marketing Act.

The notice of rescission

• Homebuyers must serve rescission notice to the seller through registered mail, fax, email with read receipt, or personal service.
• The notice must contain the address, PID or description of the property, the names and signature of the buyer(s), name of the seller(s), and the date of notice.

Additional Disclosure

Realtors must also provide an additional mandatory disclosure when presenting an offer to a client, outlining:

• that the protection period can’t be waived,
• the rescission period,
• the dollar amount of the rescission fee,
• deposit handling, and
• the homebuyer protection period exemptions.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source:  REBGV

First Time Home Buyers Guide in Richmond, BC, Canada

 

Congratulations on taking the first step towards owning your first home in Richmond, BC! Buying a home can be an exciting and overwhelming process, especially for first-time buyers. But don't worry, with a little preparation and education, you'll be on your way to finding your dream home in no time.

Here's a guide to help you navigate the home buying process in Richmond, BC.

1.     Determine Your Budget: Before you start house hunting, it's important to have a clear understanding of your budget. Take into account your monthly income and expenses, and seek the help of a mortgage broker or financial advisor to determine the amount you can afford to borrow.

2.     Get Pre-Approved: Obtaining pre-approval from a lender is crucial as it gives you a clearer picture of the mortgage amount you can borrow and helps you establish a budget for your home purchase.

3.     Hire a Real Estate Agent: RE/MAX Michael Cowling and Associates Realty can help you navigate the complexities of the home buying process, including negotiating with the seller, handling the paperwork, and assisting with the closing process.

4.     Choose the Right Neighborhood: Consider factors like schools, transportation, and amenities when choosing the neighborhood for your first home. Research the area, visit online property tours, and take a tour to get a feel for the neighborhood.

5.      Home Inspection: Before finalizing the purchase, it's important to have a home inspection to ensure the property is in good condition and to identify any potential problems.

6.      Close the Deal: Once you have found the right home, you'll need to have your agent make an offer to the seller. After the offer is accepted, the closing process will begin, which includes signing the final paperwork and paying the closing costs.

7.      Move In: Congratulations, you are now a homeowner! It's time to move in and make your new house a home.

In conclusion, buying a home in Richmond, BC can be a great investment, but it's important to be well-prepared and informed. Take your time, seek my expert help, and follow these steps to make your home buying experience a success.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source: Michael Cowling

B.C.'s housing market nears 'cyclical bottom:' RBC

 

Canada’s housing market is inching closer to its “cyclical bottom,” and British Columbia is following suit, with home resale activity in the province gradually stabilizing, according to a recent housing market update from the Royal Bank of Canada (RBC) (TSX:RY).

This has implications for the rest of B.C.’s economy. Activity levels in the resale market tend to lead the rest of the economy, according to Brendon Ogmundson, chief economist with the British Columbia Real Estate Association.

“If we’re in an economy that’s potentially headed for a recession in 2023, the pattern that you see throughout history is that sales decline well in advance of the recession, and then bottom out and start to recover one to four months or so into a recession,” Ogmundson said.

Currently, home sales in the Vancouver market, he said, are roughly 25 per cent below normal levels and are “about as low as they can get,” he added.

According to Robert Hogue, assistant chief economist at RBC, activity in the Lower Mainland and Victoria is levelling off.

“Recent declines have slowed quite considerably, and we’re probably not that far off from the bottom. But that being said, the level of activity, even in B.C., is historically low right now. Things are quiet,” he said.

In the coming months, Hogue said he expects to see home prices depreciate further. The Multiple Listing Service (MLS) Home Price Index for B.C. has declined 10 per cent from its February 2022 peak, with the index for Vancouver dropping eight per cent, according to RBC’s market update.

Despite the bottom being “imminent,” as described by Hogue, he predicts that recovery will be a “large muted affair at first.”

“Higher interest rates and stretched affordability will continue to be huge issues for buyers throughout 2023 and possibly beyond. This is poised to keep activity quiet and limit any price gains,” Hogue said in the update.

Metro Vancouver home listings on MLS reached 53,865 in 2022, a 13.5 per cent decrease compared to the 62,265 homes listed in 2021, according to the Real Estate Board of Greater Vancouver.

“It’s not hard to see a situation where the sales are rebounding into a market that is still under-supplied,” Ogmundson said.

Ogmundson said that even if B.C. hits its cyclical bottom, recovery will be slow throughout 2023, but strong in 2024.

“What we’ve seen throughout history is that the year after a recession, the home sales in the province rise anywhere between 25 and 40 per cent. But, that really relies on interest rates coming down,” he said.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source: BIV

NEWS Bank of Canada Interest Rate Update

 

The Bank of Canada raised its overnight policy rate by 25 basis points to 4.5 per cent this morning. In the statement accompanying the decision, the Bank noted that recent economic growth in Canada as been stronger than expected and labour markets remain tight but it sees growing evidence that monetary policy is working to slow the economy. The Bank expects the economy to stall through the middle of 2023 before picking up later in the year.  The Bank sees improvement in the inflation outlook with signs that core inflation has peaked and it projects a significant decline in inflation this year. It expects inflation to return to its 2 per cent target by 2024.

Most importantly, the Bank stated that it expects to hold its policy rate at 4.5 per cent as it monitors the impact of the last year of rate increases. While the door remains open to further rate increases should the outlook for inflation change, the Bank for now is on hold.  From here, the trajectory of mortgage rates will depend on the outlook for the economy. With growth expected to slow in 2023, markets are pricing in Bank of Canada rate cuts by the end of this year and average five-year fixed mortgage rates have declined in January from their peak of 5.5 per cent to 5.19 per cent and will likely fall further in coming months. However, the average variable rate mortgage, now at 6.35 per cent will stay elevated until the Bank of Canada begins lowering its policy rate.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source: BCREA

Canadian home prices remain well above pre-pandemic levels

Canadian home prices fell in the fourth quarter but they are still well above pre-pandemic levels, a report.

In a House Price Survey released on Friday, it said the national aggregate home price dropped 2.8 per cent on a year-over-year basis in the fourth quarter, to $757,100.

This marked the first year-over-year decline since the end of the 2008, during the financial crisis.

It may be headline-grabbing to say that prices are down by double digits, yet well less than one per cent of property owners completed their purchases in February or March of last year, when the pandemic-driven urgency to buy and serious housing supply shortages came together to create a final spike in prices said the report.

The Greater Vancouver Area posted record year-over-year house price declines in the fourth quarter. The aggregate price of a home in Vancouver dropped by 3.5 per cent to $1,208,900.

However, some markets reported a jump in housing prices.

The aggregate price of a home in Calgary increased by 3.9 per cent to $599,100 on a year-over-year basis in the fourth quarter, while home prices rose by 2.2 per cent to $544,300 in the Greater Montreal Area.

While the red-hot market conditions are behind us, there remains a widespread shortage of homes in Greater Vancouver and all Canada that cannot be offset by temporarily cooling demand.

Record immigration rates, high levels of employment and strong savings will put pressure on limited housing supply once again, which will drive home prices up.

Soon enough, these buyers will return to the market and will be met, once again, with the realities of low inventory and high competition.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source:  BNN Bloomberg (abridged)

New Regulations Prohibit Purchase of Residential Property by Non-Canadians

 

Purpose

The purpose of this Advisory is to provide a summary of the federal government’s Regulations, released on December 21, 2022, respecting the Prohibition on the Purchase of Residential Property by Non-Canadians Act (“the Act”). The Regulations, along with the Act itself, come into force, on January 1, 2023. 

Overview of Changes

The Regulations introduce a number of clarifications to the Act and address certain aspects of how the Act will operate when it comes into force. Specifically, the Regulations include:

Definition of “Non-Canadian”

• Expand the definition of non-Canadian to include entities that were formed other than under the laws of Canada or a province, or entities formed under Canadian or provincial laws but controlled by someone who is a non-Canadian. In other words, the definition of non-Canadian now includes partnerships, trusts, and all other persons who are not individuals or corporations;

Definition of “Residential Property”

• Exclude, from this definition, property located in an area of Canada that is not within major urban areas, defined as a census agglomeration (CA”) or a census metropolitan area (“CMA”). See Statistics Canada’s Census Tract reference maps here to determine which areas are excluded;

Expand the definition of residential property to include vacant land that does not contain a habitable dwelling, that is zoned for residential use or mixed use, and that is located within a major urban area or CA or CMA;

Definition of “Purchase”

• Clarify that a purchase means the acquisition, with or without conditions, of a legal or equitable interest or a real right in a residential property;

Introduce situations where the prohibition does not apply, such as: when a person acquires residential property resulting from death, divorce, separation or as a gift; when a dwelling is rented to a tenant who will occupy the unit; or when the transfer is under the terms of a trust created prior to January 1, 2023;

Definition of “Control”

• Clarify that privately held corporations controlled by a non-Canadian or an entity controlled by a non-Canadian are “controlled” when a non-Canadian has a three per cent direct or indirect ownership interest in an entity or corporation;

Exemption for Temporary Residents

• Clarify the prescribed conditions necessary for a temporary resident to be exempted from the prohibition;

Exemption for Foreign Nationals and Refugee Claimants

• Add foreign nationals who meet specified criteria and persons who have made a claim for refugee protection and been found eligible to the list of exempted persons;

Exemption for Indigenous People and Communities

• Clarify that the Act does not apply if it is incompatible with the rights recognized and affirmed by Section 35 of the Constitution Act, 1982, which recognizes the existing Indigenous and treaty rights of Indigenous peoples of Canada; and

Issuing Orders for Contravening the Act

• Set out that if an order under Section 7(1) of the Act is made to sell a property that was wrongly purchased by a non-Canadian that the proceeds of the sale be distributed in a specified order.

Considerations For Regulated Entities

Regulated entities are advised to review both the Act and the Regulations to ensure they fully understand the scope and application of the prohibition. The Regulations clarify a number of definitions and shed light on the full range of exempted persons, transactions, and property.

Regulated entities are reminded that once the Act is in force, any person or entity that assists a non-Canadian in purchasing directly or indirectly any residential property is guilty of an offence and could be liable to a fine of not more than $10,000.  

Regulated entities should also be aware that the Act does not apply to non-Canadians who enter into or assume liability under agreements of purchase and sale before January 1, 2023. While the sale of residential property to a non-Canadian after January 1, 2023 will remain valid, a court may order a sale of any residential property that has been purchased by a non-Canadian in violation of the Act and the non-Canadian cannot recover more than what was paid for the property.

Regulated entities that are unsure if a client, property, or transaction is captured by the Act, should advise their client to seek legal advice before continuing to provide their services.

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source:  BCFSA