A question asked by Chris in my previous blog post comments: Metro Vancouver Housing Inventory drops almost 37%… prompted this post.
Did you know that a potential buyer of a new home walking into the developer’s pre-sale office without a professional REALTOR® is compromising their position by automatically limiting their representation?
It is not possible for the developer’s agent to fulfill all the duties to both parties in a situation where, what is called, a limited dual agency relationship has been agreed to.
Don’t be confused or misled about the role of a full-service REALTOR® and how you will benefit.
Far too often new home buyer’s sign up for a “V.I.P.” pre-registration, and then not realizing all of the consequences, consent to Limited Dual Agency in writing.
Perhaps this explains why so many new home buyers don’t feel so “V.I.P.” after the fact, and protest; not that any good generally comes from complaining then though.
It may be a new condo but I will always recommend a Pre-Delivery Inspection (PDI) for the buyer’s protection. I will also recommend this CBC Marketplace video: Condo Crunch.
New home buyers often need help with many things, including completing their due diligence; making arrangements with other professionals, i.e. Lawyers, Mortgage Brokers, etc., is just one example.
My job as a REALTOR® is to protect the best interests of the buyer while ensuring that they receive the best possible representation available, and let’s be clear, this representation is limited in a Limited Dual Agency arrangement.
Considering that real estate transactions may be among the largest investment decisions made by a buyer, using the professional services of a full-time REALTOR® is a smart business decision.
I live by the golden rule by doing unto others as I would have them do unto me; you don’t need to compromise your situation.
Please contact me for a completely free, no-obligation consultation to see just how I can best serve you. You might want to start here.
There was a manufactured frenzy at the “Flo” in Richmond last night:
How else can all 55 available homes sell out in just 3 hours?
If this is true Chris then the buyers caught up in the hype basically would have waived their right [see (b) below] to properly review the complete disclosure statement.
How many buyers do you think actually read the legal jargon in the thick disclosure statement (during the buying frenzy with red dots being put up by the minute for all to see in the sales office)?
Of course no buyers read it.
In BC, part 2 of the Real Estate Development Marketing Act (REDMA), Sec. 15. Providing disclosure statements to purchasers, reads:
– (1) A developer must not enter into a purchase agreement with a purchaser for the sale or lease of a development unit unless
(a ) a copy of the disclosure statement prepared in respect of the development property in which the development unit is located has been provided to the purchaser,
(b ) the purchaser has been afforded reasonable opportunity to read the disclosure statement, and
(c ) the developer has obtained a written statement from the purchaser acknowledging that the purchaser had an opportunity to read the disclosure statement.
Of course, clause (c) is the loophole (waiver) used. So the obvious question, what is a reasonable opportunity?
Well the only solution seems to be a reservation system that allows the potential buyer to reserve a property, say for a week, to have the disclosure and contract checked out with their lawyer, and before signing a contract (or waiver).
Considering that real estate transactions may be among the largest investment decisions made by a buyer, throwing caution to the wind is not something I would recommend.
I must assume that these buyers weren’t represented by Realtors.
Are you suggesting that the developers are violating the legislation?
The 7 day recission period will give buyers plenty of time to review the disclosure.
The recission period is the purchaser’s right under REDMA to cancel the pre-sale contract within seven days of SIGNING IT.
But remember, “A developer must not enter into a purchase agreement with a purchaser for the sale or lease of a development unit UNLESS…”
So, if “the purchaser has been afforded reasonable opportunity” then no problem. Otherwise a developer has probably violated the act and the purchaser should seek legal advice regarding the validity of the contract.