Alex McFadyen

It's been the better part of six months of nonstop fire in the real estate market. The difference right now is that it's spreading like wildfire to every market and every different region of Canada. We're going to talk about some opportunities to beat the market. There's a lot of buyer fatigue right now in the real estate space. Conversations that I'm having with real estate agents on a daily basis is that there are people dropping like flies that are stressed out. We want to give back some hope to the market, not only to those people that are shopping for resale properties, but also different ways and opportunities to beat the market, whether it's what you're actually looking for right now or just different things that you might not have thought about.

Deryk Williamson

It's a super challenging market for buyers. People are literally throwing the towel in and saying, forget it. We have a couple really good strategies that we've seen some of our clients pursue to try to get around this. Some people are deciding not to purchase here, but they're looking at other locations.

Dean Lawton

You got to really find what's going to fit for you and your lifestyle and then look at these opportunities that we're going to go through today. If one of these can work for you, I highly recommend asking more detailed questions about these opportunities. We're happy to share further details on all this stuff.

Alex McFadyen

Why is this still happening? I think we've had this conversation since May of last year. I had the same feedback all the time.

"I want to see what the market does."

"I want to see what's going on."

"Rates might come back up."

None of those things have happened other than the market going up and less people wanting to sell.

Dean Lawton

There's just not a lot of inventory. Everyone wants the same thing and that seems to be the single family home with a basement suite. There's just not a lot of inventory for that. When you have 100 people looking at one property and only one person wins that offer, we have now another 99 people looking for that same product the very next day.

Deryk Williamson

It's been starting to pick up in the Langley area. You're starting to see more people listing. Another couple of factors that play in is people can work remote, so people are moving away from the city. Interest rates are a big part of this. A lot of people were on the fence and were skeptical of the market when when the pandemic hit, no one knew what was going to happen. Everyone's going to watch and see if the market is going to tank and then when it starts going up. Now you get all these people that were on the fence and they're like, I guess now's the time. I need to make this move because I'm getting priced out. You get all these people that were looking for six months wanting to buy.

Alex McFadyen

This is across Canada. We just had clients purchase a detached home in Ontario, which was listed for $199,000. They bid $125,000 over asking. They bought it for 324,000. Literally almost double the price of the property is what was offered. I personally just purchased another piece of real estate and I was able to obtain this on what we call an off market deal, which is a private sale. I came across someone who wanted to let go of their property, we found a fair price at the time, and came to an agreement to buy the property. So and I'm not the first person to do that. Having gone through that myself, it was a fantastic experience on my end of the equation and a perfect opportunity where I didn't have to bid. I got full subjects, the seller is extremely happy, I'm extremely happy, and we will be able to make that work.

Deryk Williamson

Off market opportunities are not easy to come by. You're not gonna bump into someone when you're walking down the road and they're going to offer to sell you their home. So how do you achieve this? Talk to people and let them know you're looking. It can be anyone from friends to people in your workplace. If you're a pre-approved buyer and your realtor knows exactly what you want and need, they could potentially have a lead to put that together for you. I've seen posts on Facebook with people posting, "I'm trying to buy a house for under a million in Walnut Grove. Is there anybody out there that has anything?" It might not come to fruition, but it's definitely worth a conversation.

Alex McFadyen

It can make sense as an opportunity for a lot of people to look at making that kind of situation occur. Moving on to a second opportunity outside of market or private transactions...

Deryk Williamson

The resale market is hot. That's where a real estate agent is doing showings on a Saturday and Sunday. We're seeing 100 parties come through and accepting offers on that Monday by 5pm. Those are the situations that are causing the rush and the panic. You're getting multiple offers and everyone's really thinking "how high do I have to go?" New Development properties, I believe by law, actually have to offer you a seven day rescission period, which is essentially a subject period. You have seven days to line up your financing, typically no inspections because it's not built. After seven days, you can either decide to proceed or walk away from that offer. If you don't have a strong enough application to go subject free on a property, that's a way to get into a property because they legally have to give you that seven days.

Another huge factor with the pre-sales is developers typically aren't doing showings and then accepting offers on Monday. It's first come first serve. If you go to that sales center and you find a property and you're able to put a contract together, it's yours. You're usually not going over asking price either. There's a set price, and if you're willing to pay it, you'll you'll be able to tie out that property.

Alex McFadyen 

There's a huge push by a lot of people in the industry to get a seven day rescission period for resale as well. I don't think we'll see it, at least not anytime soon. If you are looking to buy a new development property a few tips there are as follows

First is to make sure you're represented separately by the real estate agent. Personally, I've had a couple clients who have tried to deal with a sales center. It's turned into an absolute nightmare with prices changing last minute. You're going to pay the exact same amount with working with an agent or not, the difference is you'll have representation. My feedback is if you want to buy a new development property and if that's what's in your mindset, reach out directly to us to get a referral to a specialist who knows that market. We will introduce you to someone you can trust so you're well taken care of.

I'll just jump right into the next one which is buying out of town. To be more specific, what we're talking about is someone essentially relocating and looking at different markets to do their work. This doesn't work in every scenario, as an example, trying to move to Kelowna and look for the exact same product in the exact same locations as a lot of people that are looking, you're going to have some of the same challenges. If you can start to look at some other cities and other towns or different types of product solutions, or combine it with one of these other options, there is an opportunity for you to have some success. I've had some families moving up to, believe it or not, Salmon Arm on the island. Trying different places like Port Alberni going up north to, you know, some other spots that are up there as well. Looking at different types of products has been very helpful and very useful. So if you have a remote job and you've wanted to live in this beautiful place, it's more serene, maybe less busy, and a great opportunity.

Dean Lawton

What if you don't have a remote job and you are just getting frustrated with the current market? You will probably jump into another market out of town that would be similar in regards to competitiveness such as multiple offers. The price point is going to be a lot lower. If you're looking in Calgary, opposed to Vancouver, the price point for a single family home is not even comparable. An alternative option that I've seen quite regularly is people buying an investment property in Calgary. That's just my example of a city that I've seen lately where you can get a great single family home under $600,000 with a basement suite that produces fantastic rental income. The rental rates are similar to here, believe it or not.

Alex McFadyen

Don't let your money sit. One of the biggest mistakes that I've seen year after year people making is piggybacking on your previous point of jumping into a similar market somewhere else. I vividly remember a couple in 2016. Their entire family told them sell the property. The property that they sold at that time went for around $440,000. They were advised wait one year. We stayed in touch with them, that same property now, this is four and a half years later, is worth over $1 million dollars and the property they wanted to buy at the time was worth about $600,000. That property is worth about $1.4 million. From an investment piece, put your money into the market where it makes sense. Look at different regions. Put your money into a deposit or something of that nature, something that you trust. I did a consultation this morning for with someone who said we actually want to get our money into the market and make it work for us. One of the three parties is going to live in the home in the new property. The other two are basically going to put their money in as an investment. A joint venture opportunity where one has a place to live and the other two of course are part of that that journey. Basically, get creative, be open to ideas, look at different strategies, talk to family members. If you have kids, what are you going to do for an inheritance in 30-40 years. How can help your kids in the future?

Deryk Williamson 

That's a really good point of buying with family. You've gotten priced out of your million dollar qualification and maybe your parents are in a paid off home. As a group, you guys could essentially buy a $2 million property and you get your mortgage, and your parents are essentially clear title. It's beneficial to keep your eyes open.

Alex McFadyen

Start to look for markets that aren't booming. Whether this is an investment or owner occupied, open up your mind to different opportunities. In fall of 2020, the condo market in Vancouver, in particular single family condo was really depressed and they weren't selling for nearly as much as you would like to think. That's an example from a couple months ago but looking for those types of opportunities that really will start to roar back in six to 12 months when the COVID restrictions subside is a smart idea. Maybe not the play today, but you're thinking 12 months out. What is that opportunity? Those towns that haven't quite hit yet, they're going to see some increases. That home that needs a whack load of work, you know, talk about some different lending products that will help you with the renovation, look for places that maybe aren't as appetizing to you and put some effort into it that the hard work will pay off.

Dean Lawton

Most people right now are selling prior to buying. They have very restrictive dates that they have to meet. Buying a home that's not move-in ready is not a good product for a lot of people right now. Just because they don't have the flexibility or the ability to do anything with that property. They need to get their family. If you're somebody that has flexibility with dates and being able to get handy and put some work into a property, that is a fantastic opportunity, and that is definitely something we're seeing as an added viable option.

Alex McFadyen

I've probably received maybe 10 or 15 emails in the last two or three weeks from existing clients and new clients and also lots of phone calls, saying, "Hey, could I build a home? Is that even a possibility?" What does that look like for me?

Deryk Williamson

I'm helping upwards of 10 clients build their next home right now. In this market everyone wants resale. Everyone wants an existing home with a suite that they can move into. A lot of people are spinning their wheels so much that they are starting to look into other options. Construction is a big one. Construction is a piece that most people just don't understand. How would you know unless you go through the motions or talk to a professional, but a lot of people just think it's completely unachievable. There are nowhere near as many people that are looking for a bare lot and to build their next home as their are trying to get into the resale market. This gets you into a market where you can actually negotiate a decent subject period on a lot where you can build a home that could be your forever home. There's obviously a lot of benefits to building and there's also flaws to building. It's going to take you a year to build your house. You're probably going to be renting or living with family which is not always achievable. There's a lot of benefits such as when you build you will make money. Construction costs have gone through the roof recently. There are definitely still some benefits if you do it properly. You're going to create more equity than you would in a resale purchase. It's case by case and you need to run the numbers. At the end of the day qualification is the exact same whether you're buying or building. You have to qualify for the mortgage that you're using to buy or build your home. It's definitely a conversation worth looking into. Typically, minimum down payments a little bit higher, you're looking at a bare minimum 25%, sometimes more. It comes down to everyone's personal situation, but it's a great opportunity for somebody that might be fighting a brick wall in this market.

Dean Lawton 

What we were finding was people essentially settling for what they're not wanting. They wanted the extra bathroom or they wanted the master the en suite, little things that they're having to settle with because of the market. When you build, you get to build exactly what you want. In most cases, you get all these fine details that are important to you. That's that's a big reason why I'm seeing a lot of people build because they get to do exactly what they want.

Alex McFadyen

Reach out to us, we'll put you in the right direction. That pretty much wrapped up everything that we wanted to touch on today, is there any other ideas that I've not touched on?

Dean Lawton

If there's  anything you can do to change your lifestyle a little bit just to have more flexibility, because the person selling has very restrictive dates to meet, that could win the day for you.

Deryk Williamson

I've had a handful of clients that have sold their home, not realizing how challenging it's going to be to find their next home. They're now in a position where they have two and a half months to vacate their current property. They are writing offer after offer. They're actually writing off offers on properties they don't even want to buy. If you're going to be selling before you buy, have a backup, have a rental, have family that you can move in with. If you can actually write and get an accepted offer on a new home, if you're in a good market with your existing home, it's probably going to sell right now very quickly. You're probably going to sell in two days for the price that you want. Always be conservative on that price. Don't think that your million dollar home is going to sell for $1.3 million because if it sells for $1.1 million and you don't have enough to close, that can be a challenge. Just be conservative in what you're expecting to get from your house.

Alex McFadyen

This is true, especially in an unpredictable market where it is going above because these agents. Most agents are trying to price a house properly for what they think it would realistically sell for and anything above that is just a guess at best. 

Have more questions? Get ahold of us!

We're on Instagram!

instagram.com/thrivemortgageco

instaggram.com/theyvrremoshow

Check us out on Facebook!

facebook.com/thrivemortgageco

How to Reach US! 📲

Call 604.398.5575 or Email us! 

More Questions or READY to get started!?

Just Ask US > Click Here to set up a call or EMAIL us