Port Moody REALTOR, Coquitlam REALTOR, JOHN GRASTY, Prudential Sterling Realty

Should you buy or sell first?

Some of the many reasons for wanting to move include: downsizing; family growing; and, relocating.

The key to your decision on whether you should sell or buy first is planning ahead and we’ll help you explore your options.

For those that don’t have the financial ability to temporarily carry two properties, the options will be limited.

Option #1 Buy first with interim or bridge financing

Getting into an accepted offer on a new home without a subject-to-sale clause can be very costly and is not recommended unless you have made the necessary financing arrangements for the interim.

Arranging temporary funds will allow a seller with an unsold home to proceed with a purchase. This means that they will have the flexibility to move over the period of time between the possession dates of both properties, which can also be used for renovations.

The most important consideration here is that the seller must have a home that is marketable and being reasonably marketed, otherwise carrying two properties could start to get very expensive, especially if the market declines.

Occasionally a short possession date for a new home can be negotiated on behalf of a seller to reduce or eliminate the need for temporary financing.

Option #2 Sell first

Obviously the safest choice but it can also be the most rigorous. Inevitably it means an interim accommodation will be required, and perhaps two moves. This is often the case when someone is relocating and staying in temporary accommodation with their personal belongings in storage.

Focusing on selling your existing property first is often the best strategy in order to maximize your return. With cash in hand it also qualifies you in the eyes of a seller as a serious buyer, and could, depending on timing and local market conditions, strengthen your negotiating position.

If a buyer really wants your property you might even get away with a provisional rental agreement, or a contingency clause allowing you time to buy your next home, although this doesn’t happen very often.

Option #3 Subject to sale clause

In some markets choosing to write an offer with a subject to sale clause will work, but from experience in the Metro Vancouver area, it seems sellers are less open to accommodate this option.

It also requires a solid offer and probably very close to the asking price, which can limit your ability to negotiate.

Trying to match the dates exactly to accommodate both parties can also be challenging.

This balancing act is not for the faint of heart, and one of the many reasons why you should allow a REALTOR® to share some of his or her expertise.

With a savvy swagger and access to a wealth of information, it’s clear that today’s consumer is quite capable when it comes to buying a home. The irony is that smart people are still buying homes and having problems.

It’s commonplace to purchase a home and then discover that there’s something wrong with it after the fact. Just ask one of the 58 Olympic Village owners in Vancouver who have filed a lawsuit against the Developers.

The Internet can be a great way to research but it can also be a source of misleading information, like listing inconsistencies, and incomplete information.

Fortunately for future homeowners, there’s a better way to approach real estate than relying on the Internet.

It was Benjamin Franklin who said, “An ounce of prevention is worth a pound of cure”.

Too many entering the real estate market say they are anxious, and yet they have the ability to manage and control the outcome; it’s in their hands. Confidence is gained by managing risks and in real estate that is achieved by performing due diligence.

Risk goes hand in hand with confidence, so I say to those who don’t take steps to protect their interests, “Let the buyer beware”.

This week’s Buyer Beware seminar on April 12th (this Tuesday) is free, and if you’re unable to attend yourself please consider forwarding this post to anyone in your network you care for who you feel might be interested. Thank you.

For the first time we’re going to have a panel for the second half of the seminar consisting of a Certified Financial Planner, a Mortgage Broker, a Lawyer and yours truly. When was the last time you had the chance to get so much free advice?

If you’d like to register please call Grace at 604-202-5775, and I look forward to seeing you there.

This time of year is when some Real Estate Brokerages, perhaps fewer and fewer, take out an ad in the local newspaper to extend greetings. I’m not going to get into the merits of newspaper advertising, although it is well known that they have a depleting readership.

What I found interesting was comparing some seasonal ads for 2009 and 2010. This is all very unscientific of course, but it does help to illustrate a point.

There were only two local brokerages I came across doing the seasonal newspaper ads year over year and this is how they stacked up.

Brokerage #1 had a base of 33 REALTORS® in 2009, and by 2010, 10 had left and 8 had joined them. So 23 REALTORS® had been in the seasonal ads both years.

This meant that 30 percent of the REALTORS® from 2009 were now gone, and 6 percent hadn’t been replaced in the year.

Brokerage #2 had a base of 81 RELATORS® in 2009, and by 2010, 18 had left and 18 had joined them. So 63 of the 81 REALTORS® had been in the ads both years.

In one year, 22 percent of the REALTORS® had been replaced in brokerage #2.

The main point is that there is a big turnover in the real estate industry.

There are about 16,000 REALTORS® in the Province of British Columbia, and there has been about the same number of new REALTORS® licensed in the past 5 years but the total has remained fairly constant.

The total turnover of REALTORS® in BC for a 5 year period is darn close to 100 percent, and I believe that this turnover is going to get higher as we move forward.

Take your pick; a piece of the pie, or turnover?

Generally speaking, many of the more tenured REALTORS® seem to want to go to the same seminars with the same speakers and continue doing business the way they always have, and they’re all competing for the same diminishing piece of the traditional clientele pie.

The Gen “X” & “Y” are where the majority of business is today, and becoming even bigger markets every year. These markets are where the new REALTOR® might want to focus on getting established, and probably where many other REALTORS® will need to shift.

What are your thoughts?

In real estate we have to deal with legal contracts which can involve some very complex clauses. In the tradition of our professional practice I’d like to introduce a special seasonal “Santa” clause:

Subject to all prospective home buyers and sellers
celebrating this special time of year with family and
friends in whatever chosen tradition, and may whatever
brings you happiness be yours to receive this coming year.
This condition is for the benefit of all willing parties.

Whatever your goals and dreams are for 2011, I wish you all the best in achieving them, and I look forward to staying in touch in the New Year.

As you enjoy the festivities of the holiday season, travel safely and take good care.

Merry Christmas.

Information for Port Moody Real Estate, and the rest of the Tri-cities and surrounding areas of the Lower Mainland, is now available directly from your mobile device…

Apple iPhone and Windows Phone 7 users, are invited to try the REALTOR.ca app at no cost. The Blackberry® app is scheduled for release in February 2011.

My real estate clients now have the ability to check out houses whenever they want, wherever they want from their smart phone. Then they can simply and directly contact me about a specific property if they have any questions.

Try searching for me on the app; it’s easy. A setup guide has been posted online at the Canadian Real Estate Association website: www.crea.ca

More here: Port Moody Real Estate from your Mobile Device…