As home sales in the province continue on a dizzying trajectory, the province's real estate watchdog and regulator are warning buyers to be wary of what they may be getting into.
The Real Estate Council of B.C. (RECBC) and the Office of the Superintendent of Real Estate said that in the first three months of 2021, they have seen an increase in inquiries and complaints.
Calls to the regulator were up 42 per cent over the previous year, while complaints, such as how offers were made and accepted, were double the number received in the same period in 2020.
"Buying a home is one of life's biggest financial decisions. There are potential risks at the best of times, but with the added pressure and stress of the current market conditions, those risks are amplified," Micheal Noseworthy, superintendent of real estate, said in a statement.
The Real Estate Board of Greater Vancouver says sales in the region have continued at a record-setting pace.
Residential home sales covered by the board totalled 5,708 in March 2021, up 126.1 per cent from March 2020, when the COVID-19 pandemic hit, and up 53.2 per cent from February of this year.
Rural and suburban areas have experienced the biggest spikes.
For the past two weeks, Jay Park has been in the middle of the buying frenzy.
He and his partner are trying to upgrade from their one-bedroom apartment to a two-bedroom condo or townhouse in Vancouver.
"I wish we had done this a month or two ago," he said.
Park put an offer on a $1-million condo, $4,000 above asking price.
"To entice the [seller], we put in a subject-free offer, but it wasn't successful," he said. "They accepted $110,000 over asking price that was also subject-free."
The hot market has led to bidding wars. Some would-be buyers have even lined up outside for days to try to get a jump on a property.
Erin Seeley, the CEO of the council, is warning buyers to do their research and be aware of risks before making an offer.
"It's really important that buyers have engaged with their lender before they're making offers so they know how to stay within a reasonable budget," she said.
Seeley said some of the complaints the council has heard from buyers is that they weren't aware the seller has a right to take an early offer.
"And the seller was really in the driver's seat about setting the pricing," she said.
Aaron Jasper, a Vancouver realtor, advises clients to avoid cash offers and to include finance clauses even if it may mean they lose a deal.
"There's a lot of frustration among buyers, feeling pressure to take some risk," he said.
"You're better to be delayed perhaps a year getting into the market as opposed to being completely financially ruined."
Jasper also says realtors are limited in the advice they can give to clients on legal matters, home inspections, potential deficiencies with homes, and financing.
'Caught up in the craziness'
Other tips from the council include seeking professional advice before making a subject-free offer or proceeding without a home inspection, and speaking to a professional to determine how market conditions may be affecting prices.
Meantime, people like Jay Park say they are still keen to buy. Park has more viewings scheduled and is optimistic.
"It's a very exciting time for us, but I also don't want to get caught up in the craziness and make a purchase that's above our means."