As in the UK, if you wander down the main streets in an Alberta town you will find Estate Agents or as they are called in Canada, Realtors, advertising property sales. However, unlike the Uk, these are ‘brokerages’ staffed by ‘independent’ realtors managing their ‘own set’ of properties and newspaper/internet adverts. As such therefore, property advertisements in the media are under the name of an individual realtor which is a bit strange at first sight. The brokerages are staffed at the desk by the individual realtors taking turns. So if you walk in off the street and express an interest in a property, that realtor then becomes ‘yours’ and if a sale is ultimately concluded then the fees paid by the seller are split between the realtor at the desk and the realtor whose property it ‘was’. Canmore operates an MLS system (multiple listing system). This means that other brokerages can advertise your property and if a realtor in another brokerage sells it, then as before, the realtor fees are split. Compared to the UK this does seem a bit strange but it does seem to work and the seller does get maximum local exposure for the property. However the MLS and dual realtor system does mean high fees compared to a single realtor option. Typically in Canmore the fees are 6% on the first $100,000 and 3% on the balance. If the listing agent sells the property it is 3% on the first $100,000 and 1.5% on the rest. Compared to the UK these fees are high. However, as in the UK, there are internet selling options also available but not very popular.
Because Canmore is a ‘tourist town’ with some 30-50% of the properties classed as ‘tourist’, there is quite a high turnover of properties in a ‘transient’ marketplace so the realty market is very active and for the size of the place, a lot of realtors competing for business.
Now anyone over the age of 18 can become a realtor but unlike the UK, the profession is more tightly regulated, in this case by RECA, the Real Estate Council of Alberta, and realtors, by law, are required to be licensed. To become a RECA ‘certified’ realtor, this requires a study course, exams and a subsequent years ‘apprenticeship’ with a brokerage. Having met a number of realtors, the exams and study course would not appear to be too intellectually challenging. As an independent realtor, the financial rewards reflect the amount of time and energy you e are prepared to put into selling property and as such it is attractive to housewives wanting an independent source of income. That is why you find that 50% of realtors are female.
The Process of Buying
We were staying in Canmore in 2008 and on the off chance we walked into a brokerage one day to see what was available in our price range. We were pretty ignorant about Canmore properties at the time but the realtor on duty offered to take us to see a few properties. She was a lovely lady, very helpful but a rookie, not very wise on the technical aspects. When we did get serious about our Condominium apartment we asked her to get a professional inspection of the ‘in slab’ heating system in the apartment.....she sent someone down to look at the boiler room in the Condo. She did not explain the purchasing process to us as novices in a foreign land but we did muddle through and it was an interesting experience.
As you might expect with Canada, buying and selling are legally regulated beaurocratic procedures designed to protect both parties by keeping them well apart. Initially we were required to fill in a 6-page document with various deadline commitments, SEE HERE. An understanding of the perchase and sale agreement can be found HERE. First of all the buyer makes an offer somewhat below the asking price just to see what happens. The realtor negotiates with the seller’s realtor and a counter offer usually comes back and then a game of offer/counter offer ping-pong gets underway until finally a deal is reached. In our case we got a bit fed up with this and threatened to pull out......we got our price. As you can see from the form, there is an initial date for paying the deposit, allowing the buyer to get finances in place and a final completion date agreed by all parties. Once the deposit is paid, the purchaser cannot normally pull out without loss of deposit. Where a cash sale occurs, the sellers lawyer may ask for a Tenancy at Will agreement but generally by agreement you can refuse to sign this. In Alberta it is quite usual to transfer the property title just prior to closing or on the closing day but the Land Titles Registry Office can experience high workloads which does mean your lawyer has to apply for title transfer well before the completion date but to make sure it happens, the lawyers need to have all purchase monies paid into their trust account early. Your lawyer may ask you for a signed letter confirming what you believe the property is worth such that the lawyer can complete the land transfer as your agent. Somewhat bizarre but it does not mean the purchaser has a contractual right to the property at an early date, that only occurs when the money moves on the day of closing. There is usually a walkthrough before 12 noon on the day of possession to ensure the property is still as per the purchase contract.
Prior to completion, and in the case of a condominium apartment, the purchaser’s realtor has to obtain a number of documents from the condominium corporation on behalf of the buyer, namely Board Meeting minutes, the latest Reserve Fund study, a copy of the ByLaws, a copy of the Insurance Certificate and the Estoppel Certificate for approval by you and your lawyer.
We purchased our apartment from a Mr and Mrs D.Naylor and although the purchasing process is designed to keep the buyer and seller apart, as strangers from overseas, there were a number of things we did not understand and would have welcomed some direct discussion so we wrote to them. They were very helpful in explaining some of the basics of Condo ownership for which we were grateful. They had decided to settle in Mexico, which although a bit odd we thought, is a popular place with Canadians apparently. However, over the next few months we started getting mail from various sources which cast some explanation on why they had skipped the Country, namely:-
- • A demand from Ford Leasing Canada for $619
- • A delinquent balance of Payments report request from The Central Bank of the Bahamas for Renaissance
- Beach Ltd., and Renaissance Land Development Ltd.
- • Canadian Revenue Tax demands for Renaissance Beach Ltd., $2140
- • Canadian Revenue Tax demand for Renaissance land Development Ltd., $3100
- • Bank of Montreal statements for Inland Resort Group Ltd., and David Naylor Professional Corp.