FAQ

The answers to all your questions

How do I find a good REALTOR?
You can start by asking your friends if there is someone they can recommend. You can contact several REALTORS yourself and interview them. Look for someone with whom you feel comfortable and who gives you the right answers to your questions. Do not automatically choose the person who quotes you the highest price for your home or the lowest rate of commission. Also consider if a person is advertising that they list or sell more properties than anyone else, are they going to have the time to give you the level of service that you want?

What if I start with one REALTOR and then realize that we’re not working well together?
If you are a seller, you usually have the ability to cancel a contract. All parties must sign to cancel the agreement. However, should someone who had seen your house while it was listed end up buying your house within a set amount of time (which would have been specified in your listing contract) you may owe a commission to the original listing agent.

If you are a buyer, you can change your REALTOR even if you have signed a Buyer’s Agency Agreement. All parties must sign to cancel the agreement. There are conditional and unconditional cancellation forms and your REALTOR should explain both to you. Buyer’s Agency Agreements are becoming more common, and are usually a good thing to have for both yourself as a buyer and for your REALTOR. Most reputable REALTORS will not expect you to sign such an agreement until you have established some kind of working rapport.

Whom do I call to find out about a listing I have seen and am interested in?
While you can call the listing agent for information, you are better to contact your own REALTOR to make the call. The listing agent is working on behalf of the seller. You want to have your own REALTOR working on your behalf. You can call the listing agent if you want and tell them that you are working with another REALTOR.

Do I need a REALTOR to view a property?
Yes, you need a REALTOR to view any property listed on MLS. You can view a property being sold privately on your own, but many people prefer to have their REALTOR along to have that level of expertise and experience with them.

How do I know what I can afford to pay when purchasing a property?
The Real Estate Council of British Columbia has an excellent PDF document entitled Buying a Home in British Columbia. It contains a section on What Can I Afford. Keep in mind that a huge variety of mortgage products are available now, and a different type of mortgage can make a difference in what you can afford. A mortgage broker is a good person to help you figure out how much you can pay for a property.

What is “staging”?
Staging is a process undertaken to make a home look its best before it is put up for sale. An analogy would be having a makeover before going to a job fair after being out of the work force for several years. You want to show off your best qualities to impress the most people, and first impressions are everything! Staging does the same for your home. You tidy up, clear out, make necessary repairs, freshen up, have a neutral décor that appeals to a wide variety of buyers, and make sure you have curb appeal. Staging pays for itself, usually several times over, and makes a home sell faster.

Why shouldn’t I sell my home myself and save the commission?
Some people today choose to sell their own homes, particularly when they can advertise it themselves on the Internet. For some people, it’s a good decision, but they have to be knowledgeable about the market and real estate law, be able to present their home well, negotiate for themselves, and be available to take calls at any time and be home to show their property. They will be paying a lawyer or notary to do some of the work that a REALTOR would usually handle. And, most buyers will automatically want the price reduced by the amount of at least the seller’s end of the potential commission. Another factor to consider is that REALTORS have insurance which offers some recourse should problems arise.

What if I want to purchase a property as an investment?
Talk to your REALTOR. Nanaimo is a good place to invest. You want to find a property that can be rented out to cover your carrying costs, and will continue to increase in price. Currently, prices are rising steadily in all parts of Nanaimo. People wanting to relocate here in the next few years would do well to invest in something to rent out for now to get into the market. If you are investing to rent out, you should become familiar with landlord and tenant law as set out in the Residential Tenancy Act. (www.rto.gov.bc.ca/documents/RTAGuidebook.pdf)

Is there something I should do to prepare for buying a house?
Become informed about the process by reading the Buying a Home in British Columbia booklet available online from the Real Estate Council of British Columbia. Decide what you are looking for in a home, and prioritize your wish list. See your banker or mortgage broker to get pre-approved for a loan. That saves a lot of time and puts you in a stronger position to make an offer on a property when you find one you want.

Who pays the commission for the REALTOR?
The commission usually comes out of the total purchase price paid to the seller. The Brokerage of the listing agent, (the seller’s REALTOR), sets the rate of commission and specifies how much of the commission goes to the buyer’s REALTOR when the deal closes. Most often, the total commission is split evenly between the seller’s and buyer’s REALTORS, but this is not always the case. If the buyer’s REALTOR works for a higher rate of commission than has been set for the property in question, he negotiates with his own clients to pay the additional commission, but that can mean that the buyers will take that amount off what they are willing to pay for the property.

Do I have to pay GST when buying a home?
Buyers have to pay GST on new homes, new lots, sometimes on properties that have undergone substantial renovations and on some properties that were purchased by a company with a GST exemption. There is a graduated rebate for primary residences $450,000.00. For investment properties that are going to be rented out, the full amount of GST is paid. GST is also paid on the commissions. However, GST is a complex issue and you should consult with your lawyer if there are concerns.

What about using a discount realty service or broker?
People often feel they can save thousands of dollars by using such a service. The discount REALTOR charges a significantly lower commission. However, this means that the sale pays a lower commission to the buyer’s REALTOR as well, who is probably not a discount REALTOR. He or she is providing full service and expects to be paid accordingly. If the buyers decide they want a property that is listed with a discount service, they may have to pay extra themselves to their REALTOR, which they will then have to take into consideration when deciding what they are willing to offer for the property.

What other specialists are normally involved in a real estate transaction?
Both buyers and sellers will need to have their own lawyer or notary. (In British Columbia, most home sales are handled by a notary.) Buyers usually hire a home inspection company to go over the house before finalizing the sale. In some cases, buyers might need an engineer’s expertise if there are structural questions.