There are many rules and regulations surrounding real estate that are unique to BC. Here are some of the points you should be aware of:
1. Mortgage regulations in BC limit the amount of money you can borrow based on your household income.
Having equity may increase you chance of qualifying, but it will not increase the amount that you can borrow.
Check out this affordability calculator to get an estimate on the amount you can borrow based on your income. Next, talk to a mortgage specialist and get pre-approved for an exact amount. There is no cost to this and if interest rates are low, you can lock them in for up to 4 months with no obligation. Pro tip: Make copies of the first application you fill out so that you can shop around for the best rates without having to do the same paperwork over and over. The mortgage brokers can fill in their paperwork themselves as long as you provide the information.
2. Your real estate agent’s liability can be limited by what you communicate to them. Example, if you try to barbeque at your condo only to discover that the condo you purchased does not allow barbeques, you may not have any recourse if you did not communicate this to your agent. If you did communicate it to your agent and they made a mistake, they will be liable to you.
Ask your agent for a comprehensive list of the most common concerns that buyers have. Remember, it doesn’t cost you anything to communicate clearly with your real estate agent, but it could end up costing you thousands if you don’t do it properly!
3. In BC, there is a special tax for purchasing real estate called Property Transfer Tax. It is the highest extra cost that you need to be aware of. It is calculated as 1% on the first $200k of the purchase price and 2% of the balance. If you are a first time home buyer, you may be exempt.
If you go to my Buyers page, you can use the Property Transfer Tax Calculator and be sure to check out my list of Costs to Consider to help prepare yourself for the most important costs you need to consider before purchasing real estate. If you are a first time buyer, read about the PTT Exemption and other first time buyer opportunities on my First Time Home Buyer page.
4. Buyers do not pay their Realtors, most of the time. With the exception of “for sale by owner” properties and a few others, virtually all sellers with MLS-listed properties pay for the commission of both agents.
It is important to clearly communicate with your agent whether or not you would like to view properties where you may be responsible for their commission. But remember, even if you don't pay them directly, your real estate agent is likely being paid out of the purchase price, so you still want to make sure that you are getting the best value from your agent.