Determining Your Home’s Value (The CMA)

Accurately pricing your home is a science that goes far beyond a quick online estimate or a guess based on neighbourly gossip. I utilize a comprehensive Comparative Market Analysis (CMA) to determine the true fair market value of your property. This detailed process involves analyzing “comparable’s”, similar homes in your immediate area that have sold in the last 3 to 6 months to establish a baseline. However, this data alone isn’t enough, I also assess your current competition (active listings) and factor in the unique nuances that algorithms miss, such as recent renovations, curb appeal, and specific location benefits. By combining hard historical data with real-time market trends, I will pinpoint a listing price that will attract qualified buyers while ensuring you don’t leave money on the table.

While every transaction is unique, most clients should plan for a 2 to 4 month journey (depending on the market)  from start to finish. For buyers, the search phase can take a few weeks to several months depending on inventory, for sellers, a correctly priced, prepared and presented home often attracts offers within the first few weeks of exposure on the  MLS system. Once an offer is accepted, the timeline becomes more structured. You typically enter a 12 to 20 day “Subject Removal” period for finalizing, inspections and any other subjects (conditions) in the Contract of Purchase and Sale. After the deal is firm, the standard wait time until Completion (closing) is 30 to 60 days, though these dates are negotiable. Finally, it is important to remember that, “Possession Day” (when you hand over or receive keys) usually happens 1 day following Completion. All will be explained in detail.

Closing costs are the final fees required to officially transfer ownership, they are distinct for buyers and sellers. For buyers, the largest expense is typically the Property Transfer Tax (PTT), which is calculated at 1% on the first $200,000 and 2% on the balance up to $2 million. On a $900,000 home, these taxes would be $16,000. Legal fees and a portion of the property taxes associated with the property purchased. See Notes.  Buyers should also budget for legal fees and potential adjustments for property taxes or strata fees. Additionally, if the home is brand new, the 5% GST will apply to the sale price. For sellers, the primary costs are real estate commissions and legal fees to clear the title. However, a critical and often overlooked expense for sellers is the Mortgage Prepayment Penalty, if you are breaking a fixed-term mortgage early, this fee can be substantial, therefore checking with your lender beforehand is essential.

Notes: – The Buyers portion of property taxes. In British Columbia, Property taxes for the year, January 1 to December 31 are to be paid by the owner(s) of the property by July 4 of that year. For example, If the Buyers take possession on May 1, they will have to pay those taxes when due on or before July 4. The Sellers will have had possession of the property for 4 months, January through April, therefore, on the Completion date, the sellers will pay the buyers the first 4 months of the taxes owing. If the Buyers take possession on September 1, the Sellers will have paid the full year’s taxes upto December 31. The Buyers in this case, will pay back the Sellers for four months taxes, September through December. 

Example, if the taxes amounted to $6,000 per year, 4 months taxes would amount to $2,000. There may also be portions of other prepaid utility taxes owed to the Sellers.