From the "Better Late Than Never" File

I just came across a heated email I sent off to CBC Radio's morning show, Daybreak, last spring. It was in response to a story that their breathless reporter Shawn Apel did about people who sell their homes themselves and can't believe that actual real estate agents dare phone them to try to persuade them to give them the listings.

The tone of the story was a little bit heated and indignant, in the vein of  "Pushy Realtors Won't Take No For an Answer."

Needless to say, it irritated the hell out of me. So I sat down and fired off this email. The reporter sent me a brief response but as far as I know, my comments were not read on the air or published on the Daybreak web page.

I am reminded of that snarky email, because I was just contacted by someone who found my name on the web and wanted me to recommend a building inspector. Strange, I thought. Why wouldn't she ask he own agent for some names?

I emailed her back and wouldn't you know it, she doesn't have an agent. She's buying directly from the seller.  She doesn't need an agent. BUT SHE NEEDS AN AGENT TO RECOMMEND A BUILDING INSPECTOR. Is it me, or is this the height of irony?

Here's the email I sent CBC. Note how high up on my hind legs I managed to get. I've used asterisks in place of the company's full name. They will get no cheap publicity from me. 

"Hello Shawn and CBC Daybreak

I listened with interest to your segment on D* P**p*o and the agents who "pester" homeowners who list with D* P**p*o. The word pestered is an interesting one. Is that like how reporters (I used to be one) "pester" people who might not want to speak to them. Isn't that just a matter of doing the job?

I am a real estate agent. I do not solicit people who choose to list with D* P**p*o. I have, however, had clients who listed with D* P*op*o and then asked me to represent them in the purchase of the next home. Interesting. They don't want to pay an agent to sell their house but they want an agent to advise them in the purchase their next home. Why?  The vast majority of properties are listed on the MLS system. Real estate agents have access to market information and the expertise to negotiate. Ironically, Nicholas Bouchard, D* P*op*o's co-founder, the guy heard chuckling in your report, uses a real estate agent when it comes time to sell his own property. 

http://www.montrealgazette.com/business/Chalet+partly+owned+D*P*op*o+founder+listed+with+broker/6438622/story.html

(Note: This link, no longer live, is from an Allison Lampert story in The Gazette about Bouchard listing his cottage with an agent on the MLS. It went with another one about D* P*o*o's celebrity spokesthingy using an agent to sell her home, too.)

Hypocrisy, much?

Whenever I have a client selling through D* P*op*o I end up advising them on how to negotiate when it comes time to sell. It is not unusual to have to handhold them through negotiations, financing and inspection. I don't get paid to do it, you understand. I do it out of self preservation. If the sale of their house falls through, the purchase of their next house is put in jeopardy.

I wish people understood that once D*P*op*o puts up the sign and takes the pretty pictures, they leave the seller to sink or swim. You end up getting less money for your house because most people are not good at selling real estate. It is harder than it looks. I wish people would stop pretending that any fool can sell their own house.

By the way, you are soft selling when you describe D*P*op*o as a company "that helps people sell houses". They sell a range of advertising services, that's it. D*P*op*o is a wholly owned part of Power Corp. The same Power Corp that owns La Presse and makes lots of money selling real estate ads every week. Kind of a win-win situation for Power Corp., if you ask me. Not necessarily for sellers, buyers or real estate professionals but I'm sure Paul Desmarais sleeps just fine at night.

P.S.  I know your story had its genesis in the press release D* P*op*o put out May 25th about how real estate agents bother people who list with them. The company issued a retraction on June 1 for some of the more inflammatory things in that press release. "

I feel much better for having shared that with you all. Good night.

Horse Palace to become working museum | Montreal

Horse Palace to become working museum | Montreal 

This makes me happy beyond all reason. As much as renewal and construction are part of the life of a city, there's something to be said for safeguarding those funky, grotty corners that give Montreal its soul.

Do Bother Me, Please!

I'm listening to one side of a phone conversation going on about 15 feet away from me.
My colleague is talking to a professional contact about a new condo that has just been listed. The contact wants to know what my colleague thinks about the location and the price.

If I understand correctly, the person on the other end of the line has just said she's going to go over and have a look at the place and then maybe she'll call back if she's interested in making an offer.

I can hear my colleague explaining politely, but with rising vehemence, that if the person wants to visit the condo she would be most pleased to visit with her,

She isn't just being nice, you know. The agent really, really, really would like to visit that condo with her.

Seriously.

I've heard the story too many times to count. It is the story of people who don't want to bother a real estate agent until they've seen the place they like. Then and only then will they ask an agent to negotiate the purchase on their behalf.

Too late, folks. Too. Freaking. Late!

Here's a little bit of inside baseball type information for you. If you want me to represent you in the purchase of a property, I have to be the one to make the appointment to visit the place. I have to go with you for the visit and I have to be with you for all subsequent visits.

(The exception to this rule is the open house. You can go to an open house without your agent, but you should tell the agent at the door that you are working with your own agent.)

Those are the rules. The Real Estate Brokerage Act, the regulations that govern the industry, are very clear about this. The agent who is the "effective cause of sale" is the one who gets paid at the end of the day. Being the effective cause of sale can mean showing the property, pointing out the pros and cons of the property, gathering supplementary and pertinent information that helps the buyer make up his or her mind and, finally, negotiating the deal.

Being as I sell real estate to feed my family, I am really, really, really interested in getting paid at the end of the day.

Early in my career I negotiated on behalf of a family who had a really hard time buying their first home. I held their hands through the whole process and, when their bank refused to give them a mortgage, helped them find a mortgage broker who could get them good financing.

I worked very hard on that file. And I never got paid. Why? Because they buyers had visited the property once before they met me and had spoken to the agent after their visit. The listing agent had a prior claim on them,

It was a painful and expensive lesson.

So by all means, call me to talk about properties that interest you but please do take with you to visit. You won't be wasting my time. Au contraire, it's how I earn my living.  I like visiting properties with my clients and will visit as many as they need to see before we find the right one.

Honest.

Masala Comes to Point St. Charles

I was doing errands on Centre St. in the Point this afternoon and stumbled upon a new restaurant near the corner of Shearer.

Imagine my delight in finding that Masala, a well-known downtown Indian eatery and cooking school has decamped to the Le Sud-Ouest.

 Let the debate about the merits of this Indian restaurant versus that Indian restaurant rage on Chowhound, I love Indian cookery and anything that multiplies the offerings of dhal and chicken masala in my part of the world, is alright by me.

Bring your friends. And your own wine.

The Home Inspection, A Vital Step in the Buying Process

 I recently sold a century-old home in the Plateau Mont-Royal to a buyer who opted to do his own home inspection.

It is not something I would ever recommend one of my clients do, but this gentleman, a foreign-trained architect new to Montreal, was not my client. I had no voice in the decision.

The house passed inspection with the usual quirks that one finds in a 100-year-old house that has undergone wave after wave of renovation.

A week after the sale closed, I began receiving calls from the buyer in which he sought basic information about the property. Where is the main water shut-off? Where is the electrical panel? There are three hot water tanks in the basement. How can I tell which of them is actually in use?

Do I look like Mike Holmes?

His were the type of questions that a competent building inspector would have answered on the spot and again in the written report submitted after the inspection.

The buyer opted not to hire a professional inspector.

For my money, the $400 - $600 cost of a pre-purchase inspection is about the best money you'll spend. You'll walk away with a better understanding of how your home is built and what to do to keep it in good shape.

An inspector will look at all of a home's components and systems for signs of trouble. The inspection usually begins on the outside with an overview of the roof, chimney, exterior cladding, foundation, windows and doors. He or she looks for signs of water infiltration, because water, if not kept at bay,  leads to other problems like mold, mildew and rot.

Inside, he or she will check the wiring, plumbing, heating, cooling and ventilation systems. Is the wiring safe? Is the plumbing leaky? How efficient is the furnace? How old is the hot water tank?

Inspectors read things like plaster cracks, uneven floors and interior doors that don't close, looking for signs that a building is moving, sagging or is structurally unsound.

They can spot things like asbestos found in some insulation and in heatproof pipe and furnace coverings, or urea formaldehyde foam insulation, which can give off nasty gases. In some areas, pyrite is a problem. An inspector will look for signs that pyrite has led to heaving in the basement slab and recommend further testing.

Inspectors don't open walls and ceilings. They don't take things apart. They only report on the things that are visible to the dilligent eye.

A good inspector can talk you down when a problem is small or send you scurrying if a problem is severe.

Last year, I had buyers who put a bid on a fixer-upper in Lachine. Only after they had placed their bid did the listing agent mention "Oh, by the way. There's vermiculite insulation in the attic."

Vermiculite is a thing that a vendor should mention up front because some granular vermiculite insulation contains asbestos. If disturbed, asbestos fibres become airborne. Breathing asbestos, not such a good idea. There are two schools of thought when it comes to asbestos. A) Don't disturb it ot B) Have it professionally removed by guys in HAZMAT suits working in a controlled environment.

In this case, the vendor made the declaration late but with an interesting offer.The sale prices is $329,000 and we take care of removing the vermiculite, or the sale price is $289,000 and the buyers take care of the vermiculite themselves.

After some thought, my clients opted for the second option. Their inspector, a true pro, made his way to the attic saying this: "Knowing what I know about this neighborhood and the year this house was built, I would be very surprised if there was asbestos in this attic."

Vermiculite insulation. No asbestos here.

He grabbed a handful and said "Nope, you've got nothing to worry about."

A sample of the vermiculite was sent for lab analysis and came back negative for asbestos. The house had a clean bill of health.

My clients had saved $40,000 on the purchase. They were able to shovel the vermiculite up and dispose of it at their local eco centre without any fear of breathing in asbestos.

I recommend that clients talk to friends, family and co-workers to get names of inspectors. You can also go to the web site of the AIBQ, the Quebec Association of Building Inspectors to find a good candidate.

Whichever way you go, consider the pre-purchase inspection an integral part of the buying process. It is money well spent. 

What Were THey Thinking?

There's air conditioning.

What If My Co-owner Wants to Rent Out His Flat?

One of the most popular posts on my blog is the one dealing with the differences between Properties Held in Divided Ownership Versus Undivided Co-Ownership

Here's the latest question. I thought it deserved its own entry. 

Hello,

I own the lower portion of an undivided co-property. The owner of the upper is moving and has has been trying to sell his section. Since he has not had any offers he is now considering renting. According to our co-prop agreement he requires permission from the institution with which he has a mortgage and from me. I do not feel comfortable having someone who is a tenant rather than an owner living above me. Therefore I do not want to give him permission. According to him he says that he does have the right to rent out his apartment regardless of any reason I give. Is this true? Can he challenge this if I don't want to give him authorization?

Thank you for any help

Hello Anonymous,

There are two issues. First, if the agreements says you must consent, then that should be the end of the story. I would hope that your neighbor would  drop the matter there.

The second issue has nothing to do with you but is equally germane and potentially waaaay more scary for your upstairs neighbor. What does the mortgage lender say? Generally speaking, lenders (and in Quebec that means either National Bank or Caisse Desjardins) do not allow owners of undivided co-owernship properties to rent their places out because there is no automatic right for a financial institution to repossess the unit, ie to get a tenant out. That makes it harder for them to sell if a borrower defaults on a mortgage.

You have the same mortgage lender, presumably. What does your mortgage say? If there is a prohibition against renting, it will be there in black and white. If your upstairs neighbor violates the terms of his mortgage the bank could, in theory, call the mortgage loan.

I would be surprised if he has the right to rent.I would be surprised if he would want to go up against his bank. That doesn't generally go well.

Hope this is helpful.

My Hero! Century 21 Agent Amy Barratt Jumps for Kids

Every year Century 21 puts its corporate clout behind the Easter Seals campaign, raising money to help handicapped kids and their families, in one way or another. Last year, the company launched a new campaign, Drop Zone, in which C21 agents across the country suited up and rappelled down tall office buildings. Each jumper pledged to raise a mimimum of $1,500 to send a handicapped child to camp.

I am so proud to say that Amy Barratt will be taking part in this year's Drop Zone challenge. She will be rappelling down the side of 1981 McGill College Ave. in the heaty of Montreal on Saturday, September 20. You might also know 1981 McGill College Ave. as the 20-storey glass building with the marzipan/margarine people sculpture out front.

I've already sponsored Amy in this endeavor and have encouraged her to wear a super hero costume as she makes the leap.

Check out her Drop Zone page by clicking on this link

Here's a video of last year's event. It makes the thing look hardly scary at all.

Mortgage Rules Change Today

Starting today, borrowers face a new set of rules when it comes to mortgage lending in Canada.
The changes will have particular impact on younger/first-time buyers and could make it harder and/or more expensive to buy that first home.

As of today, buyers with less than a conventional 20-per-cent down payment will no longer be able to spread their mortgages over 30 years. The amortization period is being shrunk to 25 years. This is the measure that has been making headlines since June when the new rules were announced by Finance minister Jim Flaherty.  Funny thing is, the 25-year mortgage was the norm until relatively recently. The 30-year mortgage was introduced to stimulate the housing sector. Now that the job is done, we are reverting to the old rules.

 If you have 20 per cent to put down and thus don't need the Canada Mortgage and Housing Corp. to insure your mortgage, you can still get a 30-year term.

The second change to the mortgage game is that home owners will no longer be able to take quite as much equity out of their homes. Starting today, owners will be able to refinance up to 80 per cent of the value of their homes, down from 85 per cent.

 Flaherty put the new measures in place to A) cool key overheated housing markets. B) to discourage Canadians from taking on too much debt C) to persuade homeowners to stop treating their houses like ATM machines and pay off those pesky mortgages.

Flaherty announced the new measures largely in response to overheating in the Toronto market. Not everyone thinks they were the best approach.

In an interview with The Globe and Mail, Philip Soper, the head of Royal LePage, said that Flaherty used a hammer, when a fly swatter might have done the job.

 “The market is clearly cooling on a national basis, and I’m concerned that what is essentially a Toronto problem is being attacked with a blunt instrument that’s going to hurt the housing market nationwide,”

Maybe so. Mortgage industry insiders say the tightening will have the same effect as a one-per-cent interest rate hike. The government says the more stringent requirements will have an impact on about 5 per cent of new buyers, forcing them to the sidelines until either they save more or have higher paying jobs.

Some think the tighter lending rules will result in a market slowdown that would make it easier for young/first-time buyers to get into the market. Guess we'll see.

Several of my buyer clients have asked me what the mortgage rules will mean. I'm not convinced it will have much impact in Montreal. I don't see too many buyers opting for 30-year mortgages. I think I've had two clients over the course of the last two years. In Greater Toronto, some 40 per-cent of first-timers opt for 30-year mortgages. Different market, different circumstances. If clients ask my opinion, I encourage them to put down as much of a down payment as possible and to opt for as short an amortization period as possible. Call me crazy but I don't think it would be a terrible thing if marginal buyers were forced to the sidelines.

One last point. As of today, the CMHC will no longer insure mortgages priced above $1 million. It boggles my mind that the federal government was up until now insuring houses worth that much. Whatever happened to buying within your means. scraping and skimping to buy that first home? Seems to me that a $1-million home ought to be a move-up property. It would be in Montreal, but I suppose that in hotspots like Toronto and Vancouver, that kinda cash will get you a crack house or shack.

Check out  Crack Shack or Mansion and you'll see what I mean.

What Were They Thinking?

I've been saving them up, folks!  Sometimes the details are a little fuzzy, but this is ridiculous.