New federal rules force Realtors to seek IDs

June 24, 2008 · Filed Under Real Estate Articles, Remax Newfoundland and St. John's Real Estate · Comment 

New laws that kick in today will trigger major changes to real-estate transactions, as part of federal efforts to battle money laundering.

Under the new regulations, Realtors will have to collect personal information from property sellers and buyers, such as their name, address, date of birth and occupation, backed up by identification such as a driver’s licence or passport.

When dealing with foreign buyers, agents in Canada will now have to hire local agents who can vouch for the identity of the buyer.

The agents will be required to hang onto that information for five years and have it available for the Financial Transaction and Reports Analysis Centre of Canada (FINTRAC), if needed. Otherwise, the information will remain confidential.

The centre was established by the federal government in an effort to track suspicious property deals and prevent shady buyers from dumping large amounts of cash into property purchases.

Bill C-25, which was passed in 2007, demands several industries do their part to help put a stop to terrorist financing and money laundering.

It is estimated that nearly 63 per cent of money laundering is done through real estate.

ReMax reported having $2.6 billion in sales in 2007 in 67,000 transactions.

“Real estate agents have had legal obligations under the federal government’s push to prevent criminal activity and terrorism since 2001,” says Calvin Lindberg, president of The Canadian Real Estate Association. “In the first phase of compliance, real estate agents were required to report only suspicious transactions, or transactions involving more than $10,000 in cash,” he said in a news release issued Monday.

Now, real estate agents have to complete a report on the receipts of all funds received during the transaction, not just for $10,000 or more.

If an agent is dealing with the corporation, they must collect corporate documentation and the names of the corporation’s directors.

In cases where only one of the parties involved in the transaction is represented by the agent, identification must still be collected.

“Those buying or selling privately will be asked by the agent representing the other party involved in the transaction to provide proof of identity as well, and that record must be kept by the real estate agent involved in the transaction,” the news release said.

Bob Linney, CREA spokesperson, said there are also ways to keep track of buyers and sellers who choose to complete the transaction without the help of an agent.

“Sales involving private sellers only are not covered by the real estate regulations,” he told CTV.ca. “FINTRAC assumes they will be captured by regulations governing the banking industry now, and in addition by the legal profession when their compliance requirements kick in later.”

The new regulations will be non-negotiable and buyers who are unable or unwilling to provide the required information will not be able to complete property purchases. Additionally, the agent would be required to walk away from the deal or report the buyer to FINTRAC.

In Ontario alone, 47,000 realtors will be subject to the new rules.

Over the next six months, the government will perform random spot checks on real estate transactions. But once that window closes, agents will face fines, or even jail time, if they fail to comply with the regulations.

The new requirements for realtors are part of regulatory changes that Finance Minister Jim Flaherty announced in December of last year to strengthen Canada’s anti-money laundering and anti-terrorist financing regulations.

“The new regulations bring Canada’s anti-money laundering and anti-terrorist financing regime in line with the international standards set by the Financial Action Task Force, a G8 created body,” states a news release from FINTRAC.

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Free St. John’s Real Estate listings on kijiji – Is it worth it?

May 23, 2008 · Filed Under St. John's Real Estate · Comment 

I just was introduced to the world of kijiji. Kijiji is a website where you can post anything for sale or post looking for items to buy. Similar to to craigslist.org

I looked under the real estate section of St. john’s Kijiji and noticed there was 45 ads to sort through. The problem that I saw was the 40 ad’s from Realtors in Edmonton, PEI real estate, BC Real estate and realtors, free mortgage advice and online mortgage approvals from no name ad’s. However there was 5 listings there but you really had to look closely and sort through the Google Ad’s (St. John’s Real Estate Blog – www.stjohnsrealestateonline.com was there 4 times) and sponsored links. Of course I’m biased but I do not see a “free classified” online website the optimal way to promote your home for sale.

I looked on craigslist.org and ebay.ca as well for real estate listings. Much easier to find and sort through, however extremely limited in selections.

Personal plug: Why not just use a Realtor to purchase your home? It’s free to have a Realtor in St. John’s assist you in the purchasing of your new home. Both pre-existing homes and new home construction apply. Contact your local Realtor today and ask them how they can help.

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mls.ca updating to REALTOR.ca

May 21, 2008 · Filed Under Real Estate Articles · 4 Comments 

On May 28th, 2008, MLS.ca will be introducing some new features to the web site on behalf of REALTORS® across Canada. The result will be an even better real estate resource, with more information about the properties displayed on the site.

The first change will be the introduction of interactive mapping. You’ll be able to use Microsoft Virtual Earth software on the site to determine your search area, and to determine where a property is located. Interactive mapping will make it much more convenient to search traditional neighbourhoods or a specific region.

The web site will also have a new streamlined text search. You’ll be able to input your initial search criteria without all of the details of an Advance Search. The site will still offer the detailed or Advance Search option, but also has a streamlined text version to make looking for properties even more convenient.

There will be a new look, or design. The traditional REALTOR® map is still a key part of the web site, but the new layout will make it easier to look for properties and information.

And there will be a new address – www.realtor.ca Don’t worry, you don’t have to memorize it. You’ll automatically be redirected to the new address even if you input our old one.

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New money laundering legislation for Real Estate

April 28, 2008 · Filed Under First Time Buyers, Real Estate Articles and St. John's Real Estate · Comment 

Finance Minister Jim Flaherty has announced changes to Canada’s anti-money laundering legislation, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. The changes will have an impact on how real estate transactions are conducted in Canada. New amendments to money laundering legislation are effective on June 23, 2008.

Basically for the general public this means you will have to provide proof of identification when you sit down to purchase a property. Not really much difference from when you open a bank account, purchase a car or purchase insurance or receive a VISA. Need a Passport? Guess what….you need to show birth certificate and another form of identification. Need a marriage license…..same thing. Real Estate was lacking behind in this area. About time the government stepped up in my opinion.

For the Realtor? We have to Identify our clients. Currently, if you have identified an individual before, you do not have to do so again if you recognize the individual. Once the changes come into effect, if you have doubts about the information collected concerning an individual’s previous identification, you will have to identify that individual again.

If the parties in the transaction are each represented by a different real estate broker or sales representative, you will have to identify the individual or confirm the existence of the entity that you represent in the transaction.

If some parties in a real estate transaction are not represented by a real estate broker or sales representative while other parties are, each real estate broker or sales representative who represents a party to the transaction will have to identify or confirm the existence of the parties that are not represented.

To learn more visit FINTRAC’s website at www.fintrac.gc.ca

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The Basics of Making an Offer

January 16, 2008 · Filed Under St. John's Condos, St. John's General and St. John's Real Estate · Comment 

A written contract is the foundation of a real estate transaction. Oral agreements are not legally enforceable when it comes to the sale of real estate. Therefore, you need to enter into a written contract, which starts with an Agreement of Purchase and Sale.
The Newfoundland and Labrador Association of Realtors have standard purchase agreements and your Realtor will help you put together a written, legally binding offer that reflects the price as well as terms and conditions that are right for you. Your Realtor will guide you through the offer, counteroffer, negotiating and closing processes.

What is in an Offer?

The purchase offer you submit, if accepted as it stands, will become a binding sales contract. So it’s important that the purchase offer contains all the items that will serve as a “blueprint for the final sale.”

The purchase offer includes items such as:

  • address and the legal description of the property
  • sale price
  • seller’s promise to provide clear title (ownership)
  • possession date for closing (the actual sale)
  • amount of deposit accompanying the offer and how it’s to be returned to you if the offer is rejected – or kept as damages if you later back out for no good reason
  • provisions about who will pay for survey and real property report
  • Property Disclosure Statement
  • a provision that the buyer may make a final walk through inspection of the property just before the closing
  • a time limit (preferably short) after which the offer will expire
  • contingencies, which are an extremely important matter and that are discussed in detail below

Contingencies – “Subject to” Clauses

If your offer says “this offer is subject to a certain event,” you’re saying that you will only go through with the purchase if that event occurs. Here are two common contingencies contained in a purchase offer:

  • The buyer obtaining specific financing from a lending institution: If the loan can’t be found, the buyer won’t be bound by the contract.
  • A satisfactory Home Inspection: for example, “within 4 days after acceptance of the offer.” The seller must wait 4 days to see if the inspector submits a report that satisfies the buyer. If not, the contract would become void. Again, make sure that all the details are explicitly stated in the written contract.

The Deposit

This is a deposit that you give when making an offer on a house to show “good faith.” A real estate company usually holds the deposit in a trust account. This will become part of your down payment.

The Vendor’s Response to Your Offer

You will have a binding contract if the seller, upon receiving your written offer, signs an acceptance just as it stands, unconditionally. The offer becomes a firm contract as soon as you are notified of acceptance.

If the seller likes everything except the sale price, or the proposed closing date, or some of the applicances you want left with the property, you may receive a written Counter Offer including the changes the seller prefers. You are then free to accept it, reject it or even make another offer.

Each time either party makes any change in the terms, the other side is free to accept, reject or counter again. The document becomes a binding contract only when one party finally signs an unconditional acceptance of the other side’s proposal.

Buyers: Withdrawing an Offer

Can you take back an offer? In most cases the answer is yes, right up until the moment it is accepted. If you do want to revoke your offer, be sure to do so only after consulting a lawyer who is experienced in real estate matters. You don’t want to lose your deposit or find yourself being sued for damages the seller may have suffered by relying on your actions.

Counteroffers

When the Vendor receives a purchase offer from a would-be buyer, remember that unless you accept it exactly as it stands, unconditionally, the buyer is free to walk away. Any change you, the Vendor, makes in a counteroffer puts you at risk of losing that chance to sell.

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10 mistakes buyers make when purchasing a home

January 2, 2008 · Filed Under First Time Buyers and St. John's Real Estate · Comment 

1) Making an offer on a home without being pre-approved.

Being pre-approved will make your life easier so take the time to speak with a Mortgage Specialist. They will help you determine a price range you can afford and lock in a mortgage rate for a set period of time.

2) Not having a Home Inspection.

Trying to save money today can end up costing you tomorrow. A qualified home inspector will detect issues that buyers can overlook.

3) Limiting your search to open houses, ads or the internet.

Many homes listed on the website have already been sold. Your best course of action is to contact a Realtor. Call or Email Fraser & Stephen Winters. We have up-to-date information that is unavailable to the general public. The best resource to help you find the home you want.

4) Choosing a Real Estate Agent who is not committed to forming a strong business relationship with you.

Making a connection with the right Realtor is crucial. Choose a professional who is dedicated to serving your needs – before, during and after the sale.

5) Thinking there is only one perfect house out there.

Buying a home is a process of elimination, not selection. New properties arrive on the market daily, so be open to all possibilities. Ask your Realtor for a comparative market analysis. This compares similar homes that have recently sold, or are still for sale.

6) Not considering long-term needs.

It is important to think ahead. Will the home suit your needs 3-5 years from now?

7) Not examining insurance issues.

Purchase adequate insurance. Advice from an insurance agent can provide you with answers to any concerns you may have.

8] Not buying Title Insurance.
Title insurance is unlike any other kind of insurance. It is not house insurance which only protects the contents of your home or its structure and for which you have to pay a monthly or annual premium. Unlike house insurance, you only pay a one-time premium with no deductible.
Title insurance is distinctive in that it protects your ownership or title against losses incurred as a result of undetected or unknown title defects, for as long as you own your home. Even if you are the rightful owner of your home, there are instances such as real estate title fraud, when your title can come into question.

9) Not knowing total costs involved.

Early in the buying process, ask your Realtor or lender for an estimate of closing costs. Survey costs, home inspection costs, possible title insurance, possible CMHC fees and attorney fees should be considered. Remember to examine your settlement statement prior to closing.

10) Not following through on due diligence.

Buyers should make a list of any concerns they have relating to issues such as: crime rates, schools, power lines, neighbors, environmental conditions, etc. Ask the important questions before you make an offer on a home. Be diligent so that you can have confidence in your purchase.

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Property Descriptions – What’s in a word?

November 25, 2007 · Filed Under Real Estate Articles · Comment 

I recently read an article regarding Realtors “poetic descriptions” and how they relate to the property they were advertising. The article suggested that home sales from 1997 to 2000 found that listings using words such as “beautiful,” “good value” and “handyman special” sold faster, while listings with “rental” and “motivated” sat longer, and “must see,” “vacant” and “moving” made no significant difference. Whether this is fact or fiction, they did post a list of interesting words and “their” definitions of the words. Some are quite amusing.

LISTING LANGUAGE DECODER

Cut and paste from (www.seattlepi.com)

Some words and phrases real estate agents use in listings, along with what they (may) mean:

Very quiet interior: You can barely hear the freeway with the windows shut.

Convenient to shopping: Next to a strip mall.

3+1 bedrooms: The room in the basement isn’t a legal bedroom but, well, you know.

Great bones: You’ll need to tear it down to the studs.

Charming: Small.

Cozy: Tiny.

Cute: Small and fussy.

Dollhouse, adorable: Nauseatingly cute.

Turnkey: Just overhauled, complete with granite countertops and stainless-steel appliances.

Unique: Remodeled by someone on acid.

Handyman special: Bring boots.

Motivated seller: They need to sell before they default on their mortgage.

Dirty, ugly, smelly: Dirty, ugly, smelly.

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