Real estate in Calgary - another bubble?

[Mr.Coffee]

Originally Posted by Sliver

New one is two bedroom and has a heated garage I'm turning into a bunkhouse for my kids' friends. Lots of fun times to come!

Woah that’s sweet. Dad of the year!

[nik-]

Originally Posted by Mr.Coffee

Woah that’s sweet. Dad of the year!

Until you find out his kids are 27 and 29.

[DoubleF]

I'm kinda confused. Maybe there's a difference between Calgary and BC's real estate culture, but if you pull out of a deal based on a reason that wasn't a specific clause in the conditions, I thought you lose your deposit to compensate the seller? I've always done much more rigid conditions on a house sale and the conditions to pull out without losing the deposit is quite narrow.

Something like: if inspector finds deficiencies that requires remediation but is not in excess of $5K, can't break deal. But if the inspector find in excess of $5K of undisclosed issues then the buyer can renegotiate deal and potentially break it without penalty. Seriously though, if you haven't disclosed windows, roof and furnace, $5K of undisclosed issues is really fricken hard to come by and it just seems really damn dishonest to be unaware of that much requirement for remediation.

If sellers conditions aren't that rigid, then I wonder what the heck the realtor is doing. I've heard of some realtors being weird about that condition at first, but once you explain how difficult it is to exceed $5K, usually they tell their client it's no big deal.

Finance is another big one that I think is fair. If they can't get financing then they usually can walk, but the understanding is typically they then can't get financing in general to have been dicking around on other deals.

Another condition that can be used is that you have a short closing period (ie: 2 weeks ish) or they lose the deposit, but with approval, the seller can decide extend that time frame by a week or two to allow the seller enough time to sort out the paperwork to get the deal to go through. We didn't need the extension and I had told the buying party the reason I set it up that way was that if the banker saw the condition requirement would be in 3-4 weeks, they'd finish the paper work then. But if the condition was in 1-2 weeks, they'd finish the paperwork by that deadline.

Sucks for the poster who lost out on their deal before the open house, but that almost sounds like their representing realtor was an idiot and/or did not bother to properly ensure proper conditions in the offer to purchase. My realtor told me if a situation like that happened, we'd wait for the open house to complete but be honest in notifying those at the open house that there is an offer and if they want to put in an offer it would become a multiple offer situation. Someone would have to put in an aggressive offer with a short and very narrow or no condition time period to get me to pull the home from the market just prior to an open house. Otherwise, I'd take their deposit if they pulled out for nearly any reason. The conditions are meant to be relatively fair to both parties.

The offer to purchase should basically mean that there's a sale unless very specific #### show of situations and/or or lies causes the buyer to be unable or unwilling to purchase. I've pulled out of a purchase only once in my life based on the conditions. The seller was hiding/misrepresenting nearly $30-50K worth of immediate repairs as $5-10K worth of repairs required in a few years and they were unwilling to adjust the price or be honest, so we walked. I didn't mind there were repairs, but that differential was bull#### and their representing realtor had a reputation for being a liar that I thought was overstated until we dealt with them. The property was on the market for another 3 months with price adjustments to lower than what we had countered after the inspection and then finally pulled. I heard in the end it was sold for the price we had previously countered after the owners had spent nearly $20-40K remedying the issues we discovered. If the seller keeps saying "minor cosmetic issues" but the inspector says they're structural and has pics and stuff to prove it, that's pretty major.

[Weitz]

Fully depends on the market. If it’s a sellers market then sure use any conditions you want. If it’s a buyers market then you may have a harder time attaching such conditions.

[DoubleF]

Originally Posted by Weitz

Fully depends on the market. If it’s a sellers market then sure use any conditions you want. If it’s a buyers market then you may have a harder time attaching such conditions.

Agreed.

But the post I was responding to seemed to hint at the seller getting burned because of the use of incorrect conditions in a sellers (bidding war) market. I don't think I've ever heard of a situation where an offer to purchase wasn't blown apart because of the seller hiding significant deficiencies or without the seller basically mad that them keeping the $5-15K wasn't worth losing the deal over (they'd rather renegotiate the sale price lower than having to go through the listing process again).

[bizaro86]

I've had sellers try to pull out of firm deals twice. Once a strongly worded phone call from my lawyer was sufficient to get them in line, the other time it took an actual demand letter.

[Winsor_Pilates]

Originally Posted by DoubleF

I'm kinda confused. Maybe there's a difference between Calgary and BC's real estate culture, but if you pull out of a deal based on a reason that wasn't a specific clause in the conditions, I thought you lose your deposit to compensate the seller? I've always done much more rigid conditions on a house sale and the conditions to pull out without losing the deposit is quite narrow.

Something like: if inspector finds deficiencies that requires remediation but is not in excess of $5K, can't break deal. But if the inspector find in excess of $5K of undisclosed issues then the buyer can renegotiate deal and potentially break it without penalty. Seriously though, if you haven't disclosed windows, roof and furnace, $5K of undisclosed issues is really fricken hard to come by and it just seems really damn dishonest to be unaware of that much requirement for remediation.

This is technically true but hard to enforce.
If a buyer says they couldn't get financing or didn't like what they read in condo docs for example, it's difficult for a seller to prove otherwise and get them to perform the contract and continue.
Even with the inspection clause, they could make claims like the windows and roof are too old and will cost over $5000 to replace for example.
There's a lot of interpretation to these things, even if the buyer is clearly playing games.

While you might be right about that buyer being a liar, you'd still have to go through a legal process to get remedies (the deposit) and sellers usually just let it go and move on to other buyers.

My realtor told me if a situation like that happened, we'd wait for the open house to complete but be honest in notifying those at the open house that there is an offer and if they want to put in an offer it would become a multiple offer situation. Someone would have to put in an aggressive offer with a short and very narrow or no condition time period to get me to pull the home from the market just prior to an open house. Otherwise, I'd take their deposit if they pulled out for nearly any reason. The conditions are meant to be relatively fair to both parties.

It's only a multiple offer if the first offer is still open for acceptance.
If they're trying to come in quick before the open houses, they likely aren't leaving it open for your response into the weekend.
Would be something like an offer made Thursday morning with a response required by Thursday night.
That would be a terrible buyer's agent if they're giving you an open offer for your agent to shop around at the open houses.

[sketchyt]

Calgary Real Estate Board will vote in March whether they will merge with Alberta Real Estate Association.

Hopefully one of many moves to dismantle a shady AF industry and bring some more power/transparency back to the consumer.

[Hemi-Cuda]

https://www.reddit.com/r/Calgary/com...tment_unit_in/

$2100/mo for a crappy apartment is insane, the mortgage on our house is less than that. So glad we bought when we did in 2020, I feel for those that are stuck renting in this economy

[Locke]

Originally Posted by Hemi-Cuda

https://www.reddit.com/r/Calgary/com...tment_unit_in/

$2100/mo for a crappy apartment is insane, the mortgage on our house is less than that. So glad we bought when we did in 2020, I feel for those that are stuck renting in this economy

Except for the ones renting from me!



Seriously though, they might actually better off renting for a while rather than buying at what seems like the top of the market at high interest rates.

[Wormius]

Originally Posted by Hemi-Cuda

https://www.reddit.com/r/Calgary/com...tment_unit_in/

$2100/mo for a crappy apartment is insane, the mortgage on our house is less than that. So glad we bought when we did in 2020, I feel for those that are stuck renting in this economy

There seems to be more than a few 1+ bedroom apartments on Rentfaster under $2100.

[Mr.Coffee]

Mortgage rates are rising quick so can see why rents would be going with them, unfortunately. Look at rates a year ago, to today. Almost double?

[greyshep]

Originally Posted by Locke

Except for the ones renting from me!


Seriously though, they might actually better off renting for a while rather than buying at what seems like the top of the market at high interest rates.

Probably not wrong, we’ve been browsing for a new home in the Calgary market for a few months now and prices are kinda ridiculous. Not a lot of value out there. But it seems like part of the problem is a low amount of inventory. Hoping more choices start coming online in the spring.

[blankall]

Originally Posted by Mr.Coffee

Mortgage rates are rising quick so can see why rents would be going with them, unfortunately. Look at rates a year ago, to today. Almost double?

I think that's a bit of a myth. There are always landlords that will charge as much as possible, and that will then dictate the market.

Rent is going to, because there's more cash out there to pay for rent, and there's a general lack of housing supply. People are being forced into higher rents and worse quality of rentals. Not a good time to not already own your housing.

[Hemi-Cuda]

Originally Posted by greyshep

Probably not wrong, we’ve been browsing for a new home in the Calgary market for a few months now and prices are kinda ridiculous. Not a lot of value out there. But it seems like part of the problem is a low amount of inventory. Hoping more choices start coming online in the spring.

I wouldn't count on that. Low inventory has been an issue for almost 2 years straight now, and there doesn't seem to be any slowdown of people moving here from Vancouver and Toronto for the chance to buy a house for under 1m

[Calgary14]

I really enjoy checking bode.ca for sold data, it's something long overdue in the industry and info any potential buyer should have

[iggypop]

Originally Posted by Calgary14

I really enjoy checking bode.ca for sold data, it's something long overdue in the industry and info any potential buyer should have

Honestdoor seems to have the same info and is much easier to use the map.

[GGG]

In Calgary when oil is strong wages can support the current pricing. The median family can support the median SFH carrying costs. We just aren’t comparable to Toronto or Van.

[greyshep]

Originally Posted by Hemi-Cuda

I wouldn't count on that. Low inventory has been an issue for almost 2 years straight now, and there doesn't seem to be any slowdown of people moving here from Vancouver and Toronto for the chance to buy a house for under 1m

You are probably right. We made one offer on a home a couple months ago. Home needed 50-75k worth of immediate fix ups so we bid slightly under asking and were beat out by a buyer from BC who bought the home sight unseen at full ask.

[topfiverecords]

We just closed on our old place. Vancouver buyers. All cash.