THE BUYING PROCESS
Whether it’s your first time buying a house or you’re a seasoned investor, the process can be daunting and I'm here to guide you through that process. From the initial excitement of searching for your new home, to handing you the keys, I’ll be there every step of the way. Below is a brief step-by-step outline of the process, so you know what to expect.
We will sit down together and discuss what you’re looking for in a property. With access to all the Squamish listings, I will send property alerts to you as soon as a new property that fits your criteria becomes available, so you are the first to know.
2. View Properties
I will take you on a tour of the properties that are on your shortlist, allowing you to select the one that best suits your needs and wants.
3. Making an Offer
Once you’ve found a property that you’d like to purchase, we’ll work together to write an offer with the relevant terms and conditions that allow you to perform your due diligence on the property before finalising the sale. We may be required to review counter-offers and negotiate a final outcome that is acceptable to both you and the Seller.
Once reaching an agreement, the Seller will accept your offer or you will accept the Seller’s counter-offer, depending on the situation. If your offer is not accepted, we will continue searching together for the right property.
5. Subject Removal (if applicable)
If you had conditions in your contract (such as being approved for financing, getting an appraisal done, getting a property inspection or being approved for insurance), you will be allowed some time to complete these tasks. If you are satisfied that the conditions have been met, we will remove subjects by the due date, making your offer firm. If the conditions are not satisfied, you will not remove the subjects, which will terminate the offer.
Once subject conditions are removed from the contract (if there were any), the sale becomes firm and binding. This is the date that the balance (total purchase price minus the deposit) is paid to the Seller and Title is transferred to you. The completion date is usually set 2-6 weeks after the sale became firm and binding. It’s now time to get ready for moving day!
Usually the day after completion, possession day is the day you receive the keys to your new home and become official owners of the property!
Property Transfer Tax (PTT)
When you purchase or gain an interest in property that is registered at the Land Title Office, you're responsible for paying property transfer tax. This is calculated at 1% on the first $200,000, 2% on the portion of the fair market value greater than $200,000 and up to and including $2,000,000, 3% on the portion of the fair market value greater than $2,000,000, and if the property is residential, a further 2% on the portion of the fair market value greater than $3,000,000. This tax is payable at Completion and is usually accounted for in the Statement of Adjustments that is prepared by your lawyer or notary.
Your lawyer or notary will review all legal documents including your contract of purchase & sale, title and mortgage documents, and register the transfer of title. You can expect to pay approximately $1,500 plus GST, depending on the complexity of the transaction. Your lawyer or notary must be licensed in BC.
Depending on the size of the property, inspections can cost from $250 - $1,000. Inspections are highly recommended, and we can provide reputable contacts to you.
The federal government requires high-ratio mortgages with less than 20% down payment to be insured against default. The cost ranges between 0.60 to 3.85 per cent of the mortgage amount which is usually added to the mortgage principal.
In most cases the Realtor’s commission is paid by the Seller. However, there are some exceptions when the buyer is asked to provide some compensation.
Applicable to some transactions, GST is calculated at 5% of the sale price. It is applicable on new builds, properties that have been substantially renovated, as well as Phase 1 properties that have previously been used for commercial purposes (such as nightly rentals where the Seller is a GST registrant). A buyer of a GST applicable Phase 1 property can, like the previous owner, defer the payment of GST by becoming a GST registrant and continuing to make the property available for short-term rentals. However, a change of use of a Phase 1 property to full time residential by a new owner may trigger the requirement to pay GST on the purchase price. I always recommend that you seek independent financial advice regarding GST.
Before your lender approves your mortgage, you may be required to have the property appraised. Sometimes your lender will cover this cost. If not, you're responsible. The fee ranges from $300 to $450 plus GST.
Lenders may require a survey of the property. The fee ranges and is typically $500 plus GST.
You need to have your new property insured as of the date of Completion. For strata properties, strata fees include insurance on the building, but you still need to purchase home contents insurance.
You will be required to reimburse the seller for any prepaid property taxes.
If you purchase a property that is part of a strata, you will be required to pay monthly strata fees, which cover things such as building insurance, maintenance, snow removal, gardening, garbage removal and recreational facilities. Fees vary from property to property, depending on the level of services provided by the strata.
Canada welcomes home buyers from all countries, and there are no restrictions on the amount or kind of real estate you can buy. Non-resident clients are typically required to have a minimum 20% cash downpayment. Top Canadian lenders generally provide financing for USA residents but not other foreign buyers. Smaller lenders do sometimes provide financing for other nationalities, usually at higher than average interest rates. Often, foreign buyers are better suited to seek financing options in their home country and pay cash for their Canadian property purchase. As with any investment, it’s important to contact your accountant to understand fully how the purchase or sale of a property in Canada will affect you from a tax perspective. When buying a property in BC, foreign buyers pay the same property transfer taxes as Canadian residents.
It’s sometimes difficult for non-residents to obtain insurance for an investment property. Given that proof of home insurance is required to obtain a mortgage, this is an important factor to consider.
Below are some websites where you can find further information on buying real estate in BC, as well a list of reputable local lawyers, mortgage brokers and other experts that I personally recommend.
BC Real Estate Information
- Real Estate Council of British Columbia https://www.recbc.ca/
- Real Estate Board of Greater Vancouver https://www.rebgv.org/
- British Columbia Real Estate Association http://www.bcrea.bc.ca/
- Canadian Real Estate Association https://www.crea.ca/
- BC Assessment https://www.bcassessment.ca/
- BC Residential Tenancy Board https://www2.gov.bc.ca/gov/content/housing-tenancy/residential-tenancies
- Real Estate Foundation of BC http://www.refbc.com/
Squamish Lawyers & Notaries
- Cam Sherk, Notary Public - http://kensherknotary.com/
- Kathleen van der Ree, Race & Co. - http://www.raceandcompany.com/
- Shawn Jones, Jones & Co. - http://www.jones-co.net/
Squamish Mortgage Brokers
- Michelle Kelly - http://www.squamish-mortgage-broker.com/
- Paul Hudson - https://paulhudsonmortgages.ca/
Squamish Home Inspectors
- House Sound Home Inspection - https://housesoundhomeinspections.ca/
Squamish Home Insurance Providers
- Louise Browning, The Co-Operators - https://www.cooperators.ca/en/david-livesey-associates/Home.aspx