Buying Process for Whistler Real Estate
The buying process for Whistler real estate is explained in detail so that you have an understanding of what will be expected of you. How many times have you been in a process and you have no idea what is coming next? Worse yet, you have no idea what your role is in the process. Hopefully I have taken the guesswork out of the buying process so that you know what the next step is going to be.
- Process for Whistler Real Estate
- 1) First conversation
- 2) Non-residents of Canada
- 3) Financing
- 4) Property Search
- 5) Found a property
- 6) Write the contract
- 7) Accepted offer
- 8) Due diligence period
- 9) Deposit due
- 10) File conveyed
- 11) Prior to closing
- 12) Closing day
- 13) Possession day
- 14) Testimonial
- Closing Costs
- Professionals for buying Whistler real estate
- Sutton Group-West Coast Realty Deposit Instructions
- Legal Process for Closing
1) First conversation
- Review and sign the Disclosure in Representation of Trading Services Form.
- Discuss the market conditions and what type of property you need and want.
- Review this Buyer’s Guide, so you understand the buying process.
2) Non-residents of Canada
- Plan to open a bank account in B.C. and start using it for small transactions. HSBC is a good choice however, TD Canada Trust, RBC and CIBC all have branches in Whistler Village. ScotiaBank has a branch at Whistler Creekside. You won’t be sending money into the bank as part of the buying process so you don’t really need an account. However, the lawyers always suggest that potential buyers open an account so that you have the bank account status.
- When you are in Whistler, arrange to meet with a Whistler or B.C. lawyer and they will take a photocopy of your passport. The Federal Government requires you do this prior to sending money into Canada, which may cause a delay in the funds being transferred. Which could cause a breach in the contract which you definitely want to avoid.
- Meet with legal and accounting professionals to answer any questions you may have.
- Connect with your bank or a mortgage broker. Work with one broker, there is no advantage to picking more than one broker to let them duke it out. This could complicate your application, especially if it ends up on the same desk, but with different information on the application.
- Complete the required mortgage application forms – remember to inquire about financing on renovations.
- Financing does not cover furniture in the property.
4) Property Search
- Marion will call you when a property is listed which fits your criteria, and also with news of relevant sales.
- Auto-email option to view all new listings and sales is offered.
- www.WhistlerListings.com (WLS) is the site where all the Whistler agents market their listings.
5) Found a Property
Before writing the offer review the following where applicable. You may be asked to sign off on these when signing the initial offer:
- Strata documents including financials.
- Property disclosure statement. This will form part of the contract.
- Tenancy agreements.
- Forecasted rental bookings in place. You may have to honour these.
- Revenue generated from unauthorized accommodation.
- Unauthorized accommodation, or non-conforming space may be reported to the Fire Department. You will be asked to return the space to the original state as per the building plans on file at the RMOW. You will be required to acknowledge this on the contract.
- Waive the right to a building inspection, if applicable.
- Title will require your initials, look for any warning signs which could result in the lack of funds to close the sale.
- Assign the contract to give you options before closing.
- Hold-back clause for property owned by a non-resident, does the seller have the funds to close?
- Furniture. What if it is not all there when you take possession? Value of furniture, PST is applicable. Mortgage doesn’t cover furniture.
- Closing date is the date the title and money is transferred.
- Possession date is the date you, the buyer is allowed to legally access your property. If the property is a residential home, you may need to give the seller 2-3 days from closing to possession.
- Adjustment date is the date the lawyers use to calculate the change over of property taxes, Tourism Whistler fees, strata fees, electricity, propane bills etc.
6) Write the contract
My advice to my clients is this, if it is not written in the contract then it cannot be considered or included later without opening up the contract. You don’t want to re-open the contract, giving the the seller the opportunity to pull out..
- Include all relevant terms and conditions.
- Furniture inclusion or exclusion list.
- Involve any professionals needed.
7) Acceptance of the offer
- With an “accepted offer” the listing realtor can now accept a back-up offer if they choose.
- No-one can bump you at this stage, and the vendor cannot pull out of the contract.
8) Due diligence as per the terms of the contract
With some of real estate agents, this is the time they pass you over to their assistant, whom you have probably never met, or knew existed. For Marion, this is the most important stage of the contract. This is where Marion will dedicate herself to ensuring that everything is in order. To ensure this, Marion will:
- Coordinate due diligence with all the terms and conditions of the contract. Marion will advise you of your duties.
- Refer you to 3 building inspectors, and set you up to work with the one you have chosen. The relationship is between you and the building inspector, the cost is usually around $500-$1,000.
- Contact you when the strata documents are received, Marion will read these, and you must too.
- Time to update your mortgage broker to let them know you have an accepted offer.
- Call for a GST# if you need one 1-800-959-5525 press*
9) Deposit due
Do not send prior to subject removal.Deposit must be in the Sutton trust account by the date on the contract. Once the deposit has been received it is a “firm” transaction, and noted as “sold” on WLS. If the deposit has been sent but is not in the Sutton account, the seller may walk away, as the buyer has not fulfilled their part of the deposit agreement.
- Important to send Marion proof that the funds were transferred.
- Sutton requires all funds to be wired into the Sutton trust account.
- Upon receipt, Marion forwards the proof of deposit to the listing realtor.
10) File conveyed by Sutton
- Sutton sends the documents to your lawyer – See Legal Process for Closing, below.
- Time for you to organize services, utilities and insurance.
11) Prior to closing
- Walk-through on property prior to closing may be requested in the contract. If it has not been requested, you may not be allowed a walk-though.
- Marion and listing agent coordinate keys and passes.
12) Closing day
- Transfer balance of funds to your lawyer, as per lawyer’s instructions. Have a read of my blog on the real estate transaction closing process, especially interesting if the vendor had a mortgage registered on title.
- Lawyer receives notification from Land Title Office and forwards on notification of the sale to the buyer.
13) Possession Day
This is the date and time on the contract when you are legally permitted to enter your property. Some listing agents will not allow access on the day until the actual time on the contract. The reason for this is should something go wrong, who will be responsible?
14) Testimonial for Marion
Marion may ask you for a review on Linkedin or Google. Thank you in advance.
1) Building inspection
This ranges from $600 up to $1,500. The price is based on the size of the house. The building inspection is a relationship between the buyer and the inspector. This relationship protects the buyer but it also protects the inspector. The building inspection is typically done once there is an accepted contract.
2) Lawyer or Notary Fees and Expenses:
Further to the Contract of Purchase and Sale, the following are the customary costs. In particular circumstances there may be additional costs, but the following costs are applicable in most circumstances. The closing costs for the Buyer can range from $1,200 to $3,000 depending on whether the property is strata, has a mortgage component, location of the buyer, etc. It is always prudent to ask for a quote from your lawyer. I recommend a lawyer over a notary because should anything go sideways then the lawyer is on-hand to offer a solution. The notary will not be able to jump in should anything go sideways, they will recommend you find a lawyer.
- searching and investigating title.
- drafting documents.
- Land Title registration fee.
2) Accountant Fees and Expenses:
- GST and Tax advice
3) Goods and Services Tax (GST) 5%
This is a complex topic. In essence, if the property has been used as a residence then it is GST exempt. The seller is obligated to inform the buyer of the GST position on the property. The buyer cannot determine the GST position.
4) Survey Certificate
Never fails to amaze me how many people buy or sell a house without a land survey. This will cost you around $1,500 for the survey and another $1,000 for the surveyor mark the land with pins and tags.
5) Costs of Mortgage
- Mortgage company’s Lawyer /Notary.
- Appraisal by bank (if applicable).
- Land Title Registration Fees.
Further to the contract, insurance must be in place by 12.01 am on the closing date. If you buy a strata property, you will be required to obtain insurance against water damage. Content insurance which is approximately $600/year, is usually worthwhile.
7) Property Sales Tax 7% (PST) on furniture.
If you are getting financing the mortgage company does not fund furniture. They will want to know in the contract the value of the furniture. For example, the house is being sold for $4m and the value of the furniture is separately valued at $500,000. The seller and the buyer agree on this value of the furniture when negotiating the contract. Calculate the $500,000 at 7%.
When financing is not required and there is furniture of value included in the sale, your lawyer will tell you that PST at 7% is due. However, the lawyers are not required to submit a report to the Government. So, in essence it is up to you whether your conscience will let you skip paying the PST. The worst that can happen is you get audited, receive a letter demanding payment for the PST and then you pay up.
8) Property Transfer Tax (PTT)
This tax is due at the time of title transfer. See Frequently Asked Questions page for details and how to calculate.
Please note, I am not making any recommendations with these suppliers. I am simply providing you with a list of suppliers who have worked with me and other Sutton Group-West Coast Realty clients. Please use your own judgement. I am happy to recommend three in each category for you to choose from.
- Gordon Wiber, Gordon Wiber & Assoc., [email protected] Whistler, 604 935 1114.
- Don Barr, Barr Building Projects, [email protected] 604 905 8378.
- John Maxon, Wolf Pack Technical Services, [email protected] 604 932 9897.
- Sylvain “Slinky” Girard, [email protected] 604 938 2115.
- Sholto Shaw, Race & Co, Whistler, [email protected] (604)932 3211
- Ralph Yetman, Ralph Yetman Law, Vancouver, [email protected] 604 682 1311
- Chuck Piercy, Ratcliff and Associates, North Vancouver, [email protected] 604 988 5201
- Karen Garrett, Dominion Lending Sea to Sky Mortgages, [email protected] 604 938 3638
Marion typically writes the contract so that the deposit is not due until two business days, three business days if the buyer is a non-resident. This time excludes Saturday, Sunday and statutory holidays. The contract has a standard clause which says that the deposit is due within 24 hours of acceptance. That is overridden because should you not remove the subjects then there could be a delay in getting your deposit refunded. By issuing a deposit after the subjects have been removed, ensures that you are confident about your property purchase.
It is important to get the deposit organized in advance. Do not deposit it into the Sutton Group Realty Services Ltd. account until after the subject removal date. Marion will alert you when to make the deposit. The deposit is typically not less than 5% of the initial offer, and it is held in trust by Sutton Group Realty Services Ltd., until it is forwarded to your lawyer minus the listing (and buyer’s agent’s) commission.
The deposit funds must be received by the Sutton Group Realty Services Ltd. account by the deadline noted on the Contract of Purchase and Sale. Failure for this money to arrive on time, could result in the Seller voiding the contract. By wiring the funds the deposit is instantly received by Sutton Group Realty Services Ltd., account.
Wire Transfer Instructions
ScotiaBank which is Sutton Group’s bank, will charge you around $20 to receive a wire transfer. Please ask your sending bank to add the correct fee to the amount you are sending. Failing to add this to your wire will result in your deposit being less than what is stated on your Contract of Purchase and Sale. It is not a matter of Marion subbing you $20, it is vital to get the amount correct. Send more if you are unsure. For non-residents, arranging the deposit transfer into a Vancouver or Whistler bank during the period of subject removal will ensure you can sleep for the two nights between subject removal and the date the deposit is due in the Sutton trust account.
Upon receipt of contractual documents from Brokerage representing the Buyer. The Buyer’s lawyer will:
- For non-residents: File an application stating the sale price, for the Clearance Certificate from Canada Revenue Agency.
- Searches the title for any encumbrances.
- Contacts all applicable organizations as detailed in the contract, including ordering the strata for a Form F, which is a current financial snapshot of the unit and the strata; Tourism Whistler for fee status; financial institution for mortgage details; RMOW for property tax status; review Residential Tenancy Agreements of any tenants for transfer of security deposits and rents; prepares a Statement of Adjustment – to calculate and show the calculations that determine the exact amount the Buyer will have to pay to the Seller on closing.
- Sends the Statement of Adjustment to the Seller’s lawyer who will forward to the Seller for their sign
- Retrieves the balance of the deposit funds from Sutton Group trust account and the mortgage funds (if applicable) from the financial institution, or funds directly from the Buyer. These funds are held in trust with the Buyer’s Lawyer.
- Collects the Statement of Adjustment signed by the Buyer and the Seller, together with the funds and prepares the Land Title Transfer document.
On Closing Day
- Buyer’s lawyer sends the the Land Title Transfer documents to the Land Title office.
- Upon receipt of the Land Title Registration, the Buyer’s lawyer will fax a copy of the Registration to the Buyer’s Real Estate Brokerage and to the Seller’s Lawyer.
- The Buyer’s lawyer writes a cheque for the monies due to the Seller and sends the cheque to the Seller’s lawyer.
- Upon receipt of the cheque for monies due to the vendor, the Seller’s lawyer forwards the amount to the Seller.
- If the Seller is a non-resident, 25% of the sale price will be held back by the buyer’s lawyer until the Clearance Certificate has been received, which can take up to 18 weeks.
If you are not working with a real estate agent, and would like me to interpret this information for you, please contact me. I am here to help my clients before, during and after the transaction.
Marion Anderson, PREC*