Occasionally, somebody thinks it will be easier to avoid the middleman and purchase a home in Calgary by themselves. It seems logical on paper — and why pay a commission with a Calgary Home Buying Agent when you can peruse houses on your cell phone as easily as anyone else? The problem arises after the purchase, typically at the time of the inspection report or in fine print of the condo document, when the purchaser discovers that he or she did not know what he or she was signing.
What Actually Happens Without Representation
It's not all that much cheaper to purchase a home without an agent than people think. Commission split, in Alberta, is usually paid by the seller, not the buyer, meaning that it doesn't always increase your available cash flow if you're a solo buyer. It takes out the person whose sole job is to catch issues before they are costly issues. All the things that buyers overlook when they are so pumped about the listing picture that they are straight down with the seller's agent whose sole duty is to the seller: the basement smells of mildew, the roof needs to be replaced in two years, the title search shows an old easement, etc.
As an older community, Calgary's older neighbourhoods have their own eccentricities: older wiring, older sewer lines, foundations that have shifted their course over the last sixty or seventy years. Areas such as Cranston or Auburn Bay have different risks, primarily related to developer warranties, and some upgrades being coded. A Calgary home buying agent who has walked through a number of homes in both types of neighbourhoods will be able to see patterns that a first-time home buyer can't see.
The Paperwork Nobody Warns You About
Missing a deadline isn't particularly forgiving on Alberta's real estate contracts. There are windows for financing conditions, inspection windows, condo document review windows etc. etc. etc., and if you miss them and don't formally waive or extend them, you may lose your deposit, or end up locked into a purchase you're no longer certain of. The same people who are not represented often will not be aware of how tight these windows are until they are in one, trying to get the final stamp on a mortgage application in 48 hours before the deadline.
Purchasing condos is another completely different ball game. This may sound tedious, but it is a crucial step that buyers often overlook, leading them to find themselves having to pay $30,000 on a special assessment of the unit they purchased in a building. A condo specialist in Calgary home buying is familiar with the questions that he or she should ask the property manager and what red flags in a reserve fund study are important and what are routine questions.
A Cost That's Easy to Miss
The emotional price of negotiating alone is an issue that is never really talked about in these discussions. When buyers aren't represented, they are inclined to either overprice in order to appear "cool," or lowball so much they risk being so intractable they lose the property altogether. The third party between you and the seller's agent completely alters the dynamics — it removes the personal attack from a rejection of an offer, or a potentially awkward counteroffer.
AJ Sidhu has experienced this more times than he can count, when clients had initially attempted to do everything on their own to lose a property they really wanted. At this stage it's not so much the money, it's more about the logic. It's the unknown unknowns to them.
Questions Worth Asking Yourself First
It's important to be honest before making a decision to go into business on your own:
Are you familiar enough with a home inspection report to be able to use it to negotiate the repairs or a reduction in price?
Can you read the financial statements and reserve fund study of a condo without assistance?
If the answer is either of the above, then it is likely that you should consider a sign, even if you are fine with handling listings yourself.
The Calgary real estate market takes its time and when it comes to buying without a guide, errors often reveal themselves months or years after closing rather than the day of closing. A clause that was missed, an issue with property lines and boundaries, a special assessment vote that has not been brought to the fore — none of these can be seen at first glance, and that is why they are so shocking. The short-term advantage of representing oneself is not always worth the short-term disadvantages that become apparent in the long term.
Contact AJ Sidhu
Email: ajsidhurealty@gmail.com
Phone: +1 (403) 667-0048
Location: Calgary, Alberta, Canada
Website: https://ajsidhu.ca/