Each week, the Real Estate Therapist radio show on Roundhouse Radio 98.3FM, hosted by REW.ca editor Joannah Connolly, offers information and advice on the Lower Mainland real estate market, drawing on the expertise of an industry guest. In the first of our weekly series on five key takeaways from the show, the February 4 edition's guest, lawyer Ron Usher, offers his pearls of wisdom from decades of real estate conveyancing experience. Usher is General Counsel at the Society of Notaries Public of BC and an adjunct professor at SFU's department of criminology.
To listen to the full interview, click here – and for the audio clips on each of the topics below, scroll to the minute-mark cited.
1. Both overseas buyers and developers need to be careful of contract assignments motivated by foreign buyer tax: Usher says that since the 15 per cent foreign buyer tax was introduced in August, there has been a slew of contract assignments as buyers wanted to get out of their purchases over the extra cost. However, both they and the building’s developers have to be careful not to be seen as flouting anti-tax-avoidance laws – and this has led to a bottleneck of applications for advance rulings at the Property Transfer Tax office. “Developers are very reluctant to consent to assignments that before would never have been a problem,” says Usher. “When you bring in a new policy, you need to make sure – are you staffed up enough to respond to this?” (Clip starts 9 mins 45 secs.)
2. Beware real estate seminar scams – here’s how to spot them: Usher says, “The scams are so darn predictable in their format, they’re actually easy to spot in the wild. The scams we’ve looked at have remarkable similarities.” Usher explains that you need to look out for free seminars with overblown marketing using testimonials, celebrity names and promise of extravagant free gifts. He adds that at the event itself, there are multiple ways in which even the most skeptical of delegates could easily get hooked into getting out their credit cards and paying for further courses. “The psychology of it is extraordinarily powerful. Be very careful – and don’t take your credit card if you go to one of these seminars.” (Clip starts 16 mins.)
3. Always do your own due diligence when buying a home: “Trust, but verify,” advises Usher. He explains that real estate agents, the vast majority of whom are trustworthy, could themselves be misinformed about a home’s condition, strata history or lot size, for example. “Fortunately we live in a golden age of fact verification. There’s information available both through the excellent Land Titles system and through public records.” Usher adds that just Googling a home's address can offer a buyer great insight into the property, and that GIS – geographic information sites – have dramatically improved over the past few years and allow users find visual information such as pipework, zoning, lot sizes and much more. “These tools make the invisible visible,” adds Usher. (Clip starts 29 mins.)
4. Budget for multiple home inspections in your home purchase: Far from considering home inspections to be an annoying and unnecessary expense, Usher recommends that home buyers automatically budget for several home inspections as part of their whole home-purchasing process. “A home inspector will look in the attic, in the walls, behind the stove. People think that if they spend the money on a home inspection, especially when it comes back negative, that it was a waste of money. But I say no – budget in two or three home inspections. Consider it a blessing, especially when a home’s problems are revealed and you are not going to be responsible for that – that’s good news.” (Clip starts 36 mins 30 secs.)
5. Don’t think that notaries are just less-qualified lawyers – they’re just as good at real estate conveyancing: In answering a listener's question, Usher explains that the difference between lawyers and notaries is that lawyers train in all aspects of the law, whereas notaries are specialist legal professionals who have focused their training on real estate conveyancing. One profession is no better than the other, the fees are very similar and it’s best just to use a professional who specializes in residential real estate and perhaps is recommended to you. “The selection process will be based on the other ways you’d select a professional,” says Usher. “Is someone available to you? Do you like their attitude? Do you feel appreciated by them? But there is no separate standard for advice given.” (Clip starts 40 mins 30 secs.)