85: Why You Never Buy the Nicest House on the Street with Lawrenson Walker Appraisers' Derek Funk

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Welcome back to the Colonial Real
Estate Podcast.

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I'm your mortgage broker host,
Taylor Atkinson.

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And I'm your real estate agent
host, Matt Klan.

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What's happening today, Taylor?
Hey, I was at a lender

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presentation yesterday and they
bring in a CMHC rep, like awesome

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information they're providing at
these events.

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I'm gonna ask you a skill testing
question.

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I would never have gotten this
right.

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It is like, it blew my mind.

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It absolutely blew my mind.

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So CMHC data across Canada, what
do you think the average age is

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for a first-time homebuyer?
blew my mind.

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homebuyer?
Okay, I saw something like this.

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It was like way older than you
thought.

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It was like 55, right, or
something?

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So it was 36 across Canada, 39 in
BC, which to me is like, yeah,

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pretty mind-blowing.

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Okay, so that's the age of the

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first-time homebuyer.

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Okay, so that's the age of the

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first-time homebuyer.

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Yeah.

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Okay, because it was like the
average age, that's the one I saw

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was like of a regular home buyer,
it was like 50.

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Yeah, so like somebody just
getting in the market, which is

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pretty wild.

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And then 20% of people buying

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their first home have a gifted
down payment, which I actually

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thought that would probably be
higher.

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Yeah, I would think that too,
yeah.

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And then the collective household
income for those first-time

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homebuyers you know one household
unit whether a couple or solo was

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144 000 which again i thought was
like fairly high so pretty

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interesting data out there but
we're projected to like see more

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first-time homebuyers in the
market with some of the programs

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and incentives that are coming out
and younger they didn't really

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specify on the age, I would
assume.

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But yeah, I mean, we do have a
younger population coming in a

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little bit, but yeah, some
interesting stuff.

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Today we have on Derek Funk from
Lawrence and Walker, residential

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appraisal company throughout BC
and Alberta.

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I work with these guys a lot.

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They're awesome.

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Yeah.

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Just very straightforward,

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transparent, quick, good
communication.

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One thing I'll say that's really
annoying to me about the appraisal

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process, and this is not anything
to do with Derek, but just to

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explain to the listener and
clients is most of the time we

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have to order a blind appraisal.

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So it's arm's length.

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You can't get involved, manipulate
it, whatever.

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It's not like I can just pick
Derek's company all the time

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unless it has to go direct to a
lender.

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Part of that process is basically
just working with someone you

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don't really know.

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And a lot of clients come back to

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me and ask me for the report.

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We can't provide that.

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It's technically property of the
lenders.

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So again, just something for
people to keep in mind.

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Like, are you allowed to tell them
what they came back what came back

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with for value?
Yeah.

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So we can discuss that.

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We just can't provide the report.

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There's like a liability there and
you're legally not allowed to.

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So just a part of the education
process, like these guys are a

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really good resource and like a
necessary part of the buying and

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selling process that everyone has
to kind of just let them do their

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job and not try and get it does
kind of make sense that you can't

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just pick the appraiser all the
time although you can with some

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like is it certain lenders that
don't does kind of make sense that

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you can't just pick the appraiser
all the time although you can with

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some like is it certain lenders
that don't let you do that certain

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lenders they have an approved list
and you're allowed lenders they

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have an approved list and you're
allowed to pick that approved list

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the appraisal still has to be sent
directly to the lender.

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But yeah, the blind ordering
system is pretty frustrating.

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Yeah.

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One of the takeaways I really

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liked, which Derek said on the
show, was opportunities in the

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market.

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And this kind of seems simple, but

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he took it one step further.

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He was like, don't buy the nicest

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house on the street, but also
don't overspend on your property

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if it is not going to get the
value back from it that you're

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looking for an investment so he's
like you know don't spend twenty

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thousand dollars on a fridge if
you know the house shouldn't have

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a twenty thousand dollar fridge so
that's probably like a common

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thing he sees in Kelowna I would
imagine but I'd imagine that too

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yeah people like People like their
that too yeah people like People

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like their stuff.

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Yeah.

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So actually full disclosure, Beck
and I had a house downtown that

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just like look like one of the
other houses, but we just

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renovated the shit out of it.

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So when he walked into this house,

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it was just like totally did not
fit at all.

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It definitely was probably who he
was talking about with that one.

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So. I mean, if you're going to
live there for a while, for sure.

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But if you're looking for an
appraiser to come in and be like,

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oh, yeah.

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If you're doing it for the value,

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probably not great.

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If you're looking to sell it or

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not great.

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If you're looking to sell it or

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refi, like he's probably kind of
between a rock and a hard place

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being like, I can't add it.

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add it.

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The most annoying part about mine
is we ended up selling to a

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developer who's going to like tear
it down.

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So it's like, okay.

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Yeah, you should have put in the

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contract like comes with no fridge
no appliances i was going to do

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that when i was going to do that
when we leave like take the

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cabinets take the fridge take the
appliances everything but uh he's

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got to rent it out for a few years
he's renting it out so couldn't

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even really do that so we enjoyed
it while we had it yeah it's fun

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to we had it yeah it's fun to do
those projects we're actually

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getting a appliance package right
now i'll say yeah we went around a

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bit man trail appliances there's a
guy named dave there legend we

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were in there for like two and a
half hours i thought i was in

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there for 20 minutes the amount of
knowledge like i was blown away

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how smart dishwashers are now he
knows everything man if you guys

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are looking to get appliances go
see dave at trail he was like

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unreal that's a nice plug we're
not not getting a $20,000 fridge.

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I'll say that.

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Dave wasn't good enough then.

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Well, he was too good.

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No, He probably said the same

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thing.

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Yeah.

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All guys.

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right, This like every episode, is

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sponsored episode, by Century 21
Assurance Realty.

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We are growing.

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We're growing north.

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We're growing east.

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Basically all over the interior.

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So if you're a new agent or an
agent looking for a change, give

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us a Or call.

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if you're a buyer or seller

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looking for an agent, call Century
21 Assurance Realty.

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All right.

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Thanks a Enjoy lot.

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the episode.

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Okay, Derek, welcome to the the

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show.

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Thanks for joining us, man.

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Yeah, thanks for having me.

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Yeah, so we like to start our show

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just kind of what's your perfect
Friday look like?

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What's productive for you?
Gives you energy leading into the

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weekend?
And yeah, what do you do for fun?

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Yeah, so we Oh, well, it depends
on the season.

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But I mean, a perfect Friday from
the business standpoint, I always

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feel Friday afternoons are busiest
day of the week, you know, meet

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all our clients deadlines, a lot
of subject removals.

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As you know, the appraisal is
usually the last piece of the

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puzzle to get the deal done.

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And it's usually rushed,

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especially if they're unsure of
the lender they're using.

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So it's always a bit of a rush to
get some of these deadlines

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completed.

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Successful Friday to me and a

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productive one is just meeting all
of our clients' deadlines by that

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5pm cutoff.

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Usually, we've got a pretty large

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admin team, so they usually stick
around if we know we're going to

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be a little delayed.

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At least we can get the report in.

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They can upload it.

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If our clients need a verbal and

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just need a bit of peace of mind,
and I know the value is going to

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hit the purchase price, I'll
usually reach out, give them a

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heads up that the purchase price
seems fine here.

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So as long as we meet our clients'
deadlines, usually if it's a

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purchase, I'm pretty happy on a
Friday and our clients are happy

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and we can move on into the
weekend.

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to get some of these Yeah, I will
say on that note, you guys have

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been great communication-wise.

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And the deal flow basically goes

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from Matt, who probably has no
stress, to offload and some of

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that down to the broker and then
down to the appraiser.

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Yeah, the timelines just get
tighter and tighter.

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So yeah, apologies from everyone
in the industry.

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It's better than the better than
the COVID days because, you know,

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I thought that market was going to
tank and it did the complete

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opposite.

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And we just couldn't keep up, you

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know, in 2021, 2022, it just like
everybody in this industry, we

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were overworked and I would get
calls from our clients saying,

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where's the appraisal?
I'm like, well, you haven't even

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ordered it yet.

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Well, I need it today.

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I'm like, well, you got to submit
this in.

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So it's always good when our
clients reach out ahead of time.

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They'll either email me direct or
text me for any of the Okanagan

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files and give me a heads up.

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And at least I can reach out to

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the appraiser and say, hey, here
you go.

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This is coming through.

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Reach out for an appointment right

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now.

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They need this by end of day or

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tomorrow morning.

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At least we can get started on the

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file and ensure we can reach that
deadline.

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So that's one thing we do at
Lawrence & Walker is communicate a

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lot with our broker clients.

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That's what we focus our business

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a lot on is just communication
from start to finish from the

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file.

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It's a long process actually from

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when we get the order, from when
the payment link sent from when

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the appointment's out, you when
the payment booked,, link sent

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know, out from when the
appointments booked from the

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second review process that we
offer with our firm, just to

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ensure that everything's correct.

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There's a lot that goes into these

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reports.

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So there's quite a bit that

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actually goes in the appraisal
process that, you know, is kind of

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forgotten about.

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So we've got a solid team.

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So it really helps.

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Can you kind of tell us a little

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bit about Lawrence and Walker?
obviously I know who you You guys

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have Like, been great for me in
the we've are.

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got a solid team so it really
helps can you kind of tell us a

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little bit about lawrence and
walker like obviously i know who

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us a little bit about Lawrence and
Walker?

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obviously I know who you You guys
have Like, been great for me in

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the we've are.

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got a solid team so it really

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helps can you kind of tell us a
little bit about lawrence and

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walker like obviously i know who
you are you guys have been great

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for me in the okanagan is it
alberta bc you guys cover now yeah

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so the company started yeah so the
company started back in the 90s my

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partner lee walker took it over a
while back now and we were mainly

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00:08:24,836 --> 00:08:24,964
based in vancouver fraser valley
and then our other partner

244
00:08:24,922 --> 00:08:25,042
chantelle opened up an office in
Calgary over in Alberta, and she's

245
00:08:24,997 --> 00:08:25,102
expanded out to Edmonton and now
Lethbridge.

246
00:08:25,057 --> 00:08:25,140
And I was in Vancouver at the
time.

247
00:08:25,132 --> 00:08:23,694
And I said, we have to expand this
business more.

248
00:08:23,694 --> 00:08:24,886
So he said, well, why don't we go
to the Okanagan?

249
00:08:24,844 --> 00:08:25,101
I actually brought that up to him.

250
00:08:24,914 --> 00:08:25,003
So we came up here and we

251
00:08:24,961 --> 00:08:25,084
purchased the company up here over
five years ago now.

252
00:08:25,041 --> 00:08:25,140
So I made the move with the family
from Olympic Village.

253
00:08:25,140 --> 00:08:26,233
So never look back.

254
00:08:26,233 --> 00:08:26,943
What a sacrifice, eh?

255
00:08:26,943 --> 00:08:27,545
For company, man.

256
00:08:27,545 --> 00:08:28,036
Wine country.

257
00:08:28,036 --> 00:08:30,213
You really had to take one for the
team there.

258
00:08:30,213 --> 00:08:30,488
Yeah.

259
00:08:30,488 --> 00:08:33,698
So one thing is that we have done

260
00:08:31,589 --> 00:08:36,817
a lot of expansion in the last six
years, but we do have managers and

261
00:08:36,817 --> 00:08:40,392
partners in all of our major
locations that are experts in all

262
00:08:40,392 --> 00:08:41,400
these locations.

263
00:08:41,400 --> 00:08:43,876
So if you've got an Okanagan

264
00:08:43,876 --> 00:08:48,133
appraisal coming through, you're
going to be dealing with me who

265
00:08:48,233 --> 00:08:52,670
actually lives in that region and
follows the market trends, knows

266
00:08:52,570 --> 00:08:55,416
what's going on in the community,
and has a really good sense of

267
00:08:55,416 --> 00:08:57,268
idea what's going on in the market
here.

268
00:08:57,268 --> 00:09:00,038
So if you go to Alberta, you're
going to be speaking and dealing

269
00:09:00,038 --> 00:09:01,249
with Chantel who's from there,
lives there.

270
00:09:01,249 --> 00:09:03,440
So you're not getting someone from
Toronto that's, you know, working

271
00:09:03,440 --> 00:09:05,594
on a file that doesn't really know
the market.

272
00:09:05,594 --> 00:09:09,183
So, you know, you're in good
hands, whatever region you're in,

273
00:09:09,183 --> 00:09:12,156
because you're dealing with an
expert in that territory.

274
00:09:12,256 --> 00:09:12,832
Nice.

275
00:09:12,732 --> 00:09:13,020
Yeah.

276
00:09:13,260 --> 00:09:13,960
And Yeah.

277
00:09:14,120 --> 00:09:14,976
And can you pull back the curtain

278
00:09:14,976 --> 00:09:18,468
a little bit in terms of like
being on an approved list?

279
00:09:18,468 --> 00:09:22,836
Because it's not like you can just
do your four-year degree, get the

280
00:09:22,836 --> 00:09:25,384
appraiser certificate, and then
you're good to go, right?

281
00:09:25,384 --> 00:09:28,887
You need to be registered with
certain lenders and have the

282
00:09:28,787 --> 00:09:29,692
capability to be doing certain
properties.

283
00:09:29,692 --> 00:09:34,718
So I remember one of the first
ones I used you guys with was on

284
00:09:34,718 --> 00:09:38,425
raw land up in Big White, which
not very many people had the

285
00:09:38,425 --> 00:09:39,441
ability to do.

286
00:09:39,341 --> 00:09:40,805
So what's kind of the process and

287
00:09:40,805 --> 00:09:43,387
benefit of using somebody that has
access or approval for most of the

288
00:09:43,387 --> 00:09:45,424
lenders?
I think it's just in the industry

289
00:09:45,424 --> 00:09:49,316
for so long, it's just in the
industry for so long, like Lee has

290
00:09:49,316 --> 00:09:51,301
been, and building these
relationships with the lenders,

291
00:09:51,301 --> 00:09:53,350
the private lenders, the MIG
lenders, and just building a

292
00:09:53,350 --> 00:09:55,771
trusted relationship and showing
them we know what we're talking

293
00:09:55,771 --> 00:09:58,446
about because we have been doing
this for many years now.

294
00:09:58,546 --> 00:09:59,888
We've got very experienced people
on our team.

295
00:09:59,888 --> 00:10:02,384
And it's taken a long time to get
on the approved list for...

296
00:10:02,384 --> 00:10:05,099
We work with the majority of the
lenders across the board here.

297
00:10:05,099 --> 00:10:06,733
We have great relationships with
them.

298
00:10:06,633 --> 00:10:08,996
We talk to them on the phone.

299
00:10:08,996 --> 00:10:10,300
It's always good for our clients

300
00:10:10,300 --> 00:10:13,501
as well because if they order
appraisal and they need to move

301
00:10:13,501 --> 00:10:15,963
from one lender to another, likely
they don't have to reorder the

302
00:10:15,963 --> 00:10:17,718
appraisal because we're likely on
that other lenders approved list.

303
00:10:17,718 --> 00:10:23,120
So it's not easy to get on these
lists, but I think it's just a lot

304
00:10:23,580 --> 00:10:24,387
of trust and experience.

305
00:10:24,387 --> 00:10:26,826
And that's the reason why we're on

306
00:10:26,826 --> 00:10:29,538
the majority of all lenders across
the country.

307
00:10:29,538 --> 00:10:29,726
country.

308
00:10:29,726 --> 00:10:30,008
Yeah.

309
00:10:30,008 --> 00:10:32,457
I'll point out another thing using
you guys.

310
00:10:32,457 --> 00:10:33,427
So generally, like for certain
lenders, we have to use a blind

311
00:10:33,427 --> 00:10:35,995
ordering system software so we
don't have access.

312
00:10:35,995 --> 00:10:41,262
But I find the hardest part about
that is the client gets a payment

313
00:10:41,252 --> 00:10:44,406
notification and usually it'll be
super low for some appraisers just

314
00:10:44,406 --> 00:10:48,358
to kind of, I don't know, win the
work or that's how they bid it.

315
00:10:48,358 --> 00:10:51,196
And then like it doubles the very
next day.

316
00:10:51,196 --> 00:10:54,012
And then you have to explain to
the client like, ah, yeah, the fee

317
00:10:54,012 --> 00:10:57,079
just went up because it's a luxury
home or it has market rents or

318
00:10:57,079 --> 00:10:57,338
whatever.

319
00:10:57,338 --> 00:10:58,012
Yeah.

320
00:10:58,012 --> 00:10:59,945
You guys seem to consistently have
more transparency and like, here's

321
00:10:59,945 --> 00:11:03,220
the fee, you know, it is what it
is right from the start.

322
00:11:03,220 --> 00:11:04,982
So yeah, I just appreciate you
guys doing that.

323
00:11:04,982 --> 00:11:08,992
you know it is what it is right
from the start so yeah just

324
00:11:08,992 --> 00:11:13,065
appreciate you guys doing that
yeah you know a few years back up

325
00:11:13,065 --> 00:11:16,549
here in the okanagan i set all of
our fees for every location where

326
00:11:16,549 --> 00:11:22,813
there was going to is what it is
right from the start so yeah just

327
00:11:22,813 --> 00:11:26,500
appreciate you guys doing that
yeah you know a few years back up

328
00:11:26,720 --> 00:11:30,162
here in the okanagan i set all of
our fees for every location where

329
00:11:30,162 --> 00:11:34,290
there was going to be like a
travel charge down to a so use

330
00:11:34,290 --> 00:11:39,949
because it's a bit of a drive from
colonna so i wanted to post like

331
00:11:39,949 --> 00:11:43,582
our actual fee that you're going
to be charged without tacking on

332
00:11:43,482 --> 00:11:46,682
the travel after the fact so i
know a lot of the blind ordering

333
00:11:46,682 --> 00:11:49,954
systems, how they work, you know,
it might just get selected by a

334
00:11:49,954 --> 00:11:52,686
cheaper firm, but our rates that
are posts on solidify or whatever,

335
00:11:52,686 --> 00:11:56,029
you know, AMC it is, you know,
that's the fee it's going to be,

336
00:11:56,029 --> 00:12:00,225
like you say, unless it's going to
be some kind of high end luxury

337
00:12:00,325 --> 00:12:02,872
waterfront, you know, then we kind
of base the fee on like, you know,

338
00:12:02,872 --> 00:12:05,501
the amount of hours it's going to
take to actually get that file

339
00:12:05,501 --> 00:12:05,583
done.

340
00:12:05,583 --> 00:12:06,567
And if it is more complex

341
00:12:06,531 --> 00:12:08,593
property, I know we try to get
appraisals done within 24 hours of

342
00:12:08,593 --> 00:12:09,706
viewing the property, but
sometimes those do take longer.

343
00:12:09,706 --> 00:12:05,583
And I don't mind if we do take an
extra day or two to just ensure we

344
00:12:05,583 --> 00:12:07,432
get the right value, right?
It's more important to get the

345
00:12:07,397 --> 00:12:08,593
right value rather than just push
these appraisals out.

346
00:12:08,593 --> 00:12:08,840
So yeah.

347
00:12:08,840 --> 00:12:09,040
Yeah.

348
00:12:09,005 --> 00:12:11,125
And we'll give our clients a heads
you if up, it's going know, our

349
00:12:11,125 --> 00:12:13,403
clients a heads you know, up, if
it's going to take a bit longer,

350
00:12:13,403 --> 00:12:15,687
you know, we're doing our best,
but you know, some just take

351
00:12:15,687 --> 00:12:18,407
longer, especially here in the
Okanagan, there's not a lot of

352
00:12:18,407 --> 00:12:21,719
cookie cutter properties and very
limited sales on a lot of complex

353
00:12:21,719 --> 00:12:22,489
properties on acreages and
waterfront homes.

354
00:12:22,489 --> 00:12:25,392
So they just typically take longer
and just take more time.

355
00:12:25,492 --> 00:12:25,846
Yeah.

356
00:12:25,746 --> 00:12:27,515
And do you guys do residential and

357
00:12:27,515 --> 00:12:29,142
commercial appraisals?
We're just residential Yeah.

358
00:12:29,142 --> 00:12:31,447
do you guys do residential and
commercial appraisals?

359
00:12:31,347 --> 00:12:32,079
We're just residential firm.

360
00:12:32,179 --> 00:12:33,205
Lawrence Walker is a residential

361
00:12:33,205 --> 00:12:33,374
firm.

362
00:12:33,374 --> 00:12:33,599
Yeah.

363
00:12:33,599 --> 00:12:33,881
Interesting.

364
00:12:33,881 --> 00:12:35,120
When would clients use you Yeah.

365
00:12:35,120 --> 00:12:35,388
Interesting.

366
00:12:35,388 --> 00:12:36,662
When would clients use you outside

367
00:12:36,662 --> 00:12:39,075
of a purchase?
Like, you know, obviously I'm

368
00:12:39,075 --> 00:12:41,256
going to facilitate ordering it,
but if somebody wanted to do like

369
00:12:41,256 --> 00:12:42,936
a private sale between family
member or separation agreement,

370
00:12:42,936 --> 00:12:46,568
that kind of stuff, like where do
you guys provide value outside of

371
00:12:46,468 --> 00:12:48,482
like the lending channel?
I mean, it's the same thing.

372
00:12:48,482 --> 00:12:52,102
It's just, you know, if it's a
private request, it's the same as

373
00:12:52,002 --> 00:12:54,045
a, you know, obviously the purpose
is different than a purchase, but

374
00:12:54,045 --> 00:12:56,911
I would say lately, the majority
of our files have been refinances,

375
00:12:56,911 --> 00:12:58,208
especially in these market
conditions.

376
00:12:58,208 --> 00:13:00,925
So, you know, we do get a few
legal files.

377
00:13:00,925 --> 00:13:04,387
The issue with legal files I've
been finding lately is with all

378
00:13:04,387 --> 00:13:05,141
the upzoning now where they want
the actual true value if it's a

379
00:13:05,117 --> 00:13:06,955
legal file now, which we can do a
hypothetical appraisal on, you

380
00:13:07,055 --> 00:13:09,131
know, a potential lot that has,
you know, future development

381
00:13:09,131 --> 00:13:09,360
potential.

382
00:13:09,360 --> 00:13:10,965
Like, you know, in Kelowna South

383
00:13:11,065 --> 00:13:14,619
North, a lot of this MF1 zoning
might allow up to six units.

384
00:13:14,619 --> 00:13:18,118
And as residential appraisers, we
can only appraise properties up to

385
00:13:18,118 --> 00:13:19,420
four units.

386
00:13:19,600 --> 00:13:20,974
So if it's for residential

387
00:13:20,974 --> 00:13:24,320
lending, we will reach out to our
client or the lender and say, hey,

388
00:13:24,320 --> 00:13:23,543
are you okay with a hypothetical,
you know, appraisal value without

389
00:13:23,543 --> 00:13:25,942
taking in that future development
potential into consideration,

390
00:13:25,938 --> 00:13:28,095
which is fine if they want that.

391
00:13:28,095 --> 00:13:30,635
But if they want like, you know,

392
00:13:30,635 --> 00:13:31,400
if it's a legal file for
separation, they're gonna want to

393
00:13:31,400 --> 00:13:35,524
know what's this actually worth if
I can put six or eight units on

394
00:13:35,524 --> 00:13:37,731
this lot now, right?
If I actually go through the

395
00:13:37,731 --> 00:13:38,545
development process.

396
00:13:38,545 --> 00:13:40,987
So we have been turning down those

397
00:13:41,087 --> 00:13:44,253
files now because it's just out of
our scope now from the residential

398
00:13:44,253 --> 00:13:44,670
side.

399
00:13:44,670 --> 00:13:46,755
That has been a bit of an issue

400
00:13:46,855 --> 00:13:47,887
for those types of files.

401
00:13:47,887 --> 00:13:49,488
If it's a private request, same

402
00:13:49,488 --> 00:13:49,824
thing goes.

403
00:13:49,724 --> 00:13:51,434
If it's not for residential, we

404
00:13:51,434 --> 00:13:54,925
kind of have to refer those out to
maybe a commercial appraiser now

405
00:13:54,925 --> 00:13:59,180
that can give them the true value
that can take on.

406
00:14:00,060 --> 00:14:03,397
I mean, all the UC5 zoning may
allow up to six stories now.

407
00:14:03,397 --> 00:14:08,678
We do a few of those, but if it's
a private request, it's best that

408
00:14:08,678 --> 00:14:11,025
a commercial appraiser takes that
file on now.

409
00:14:11,025 --> 00:14:11,444
It's interesting.

410
00:14:11,444 --> 00:14:13,623
Maybe we can talk a little bit on

411
00:14:13,623 --> 00:14:16,390
new construction for just single
family then.

412
00:14:16,390 --> 00:14:19,240
You guys work in that space?
Oh yeah.

413
00:14:19,240 --> 00:14:20,162
Yeah.

414
00:14:20,162 --> 00:14:23,674
We do a lot of new new

415
00:14:23,774 --> 00:14:26,269
construction, but I do feel lately
builders have been holding off

416
00:14:26,269 --> 00:14:30,542
building as much as they were just
with the lot prices are pretty

417
00:14:30,542 --> 00:14:30,833
expensive now.

418
00:14:30,833 --> 00:14:33,769
off building as much as they were

419
00:14:33,769 --> 00:14:35,880
just with the lot prices are
pretty Now, expensive.

420
00:14:35,880 --> 00:14:37,252
the cost to build is expensive.

421
00:14:37,152 --> 00:14:39,066
And once you build out, you know,

422
00:14:39,166 --> 00:14:45,241
you buy your lot for a 750 with a
lake view, you build a one and a

423
00:14:45,241 --> 00:14:47,707
half million dollar home, people
aren't even willing to pay that

424
00:14:47,607 --> 00:14:48,578
price now after it's built.

425
00:14:48,578 --> 00:14:50,784
So yeah, well, I guess that's what

426
00:14:50,784 --> 00:14:53,857
I I guess that's what I was gonna
ask is like you take two

427
00:14:53,857 --> 00:14:55,988
approaches, right?
Like, you know, the cost to build

428
00:14:55,988 --> 00:14:58,190
and then comparables for the
market.

429
00:14:58,190 --> 00:15:01,442
Is it a pretty tough conversation
right now to be like, yeah, these

430
00:15:01,442 --> 00:15:02,047
plans look great.

431
00:15:02,047 --> 00:15:03,620
The future value for comparables

432
00:15:03,800 --> 00:15:06,933
is probably going to land you at
$2 million, but they're spending

433
00:15:06,933 --> 00:15:08,795
two and a half to build.

434
00:15:08,895 --> 00:15:11,166
I've seen that a lot lately.

435
00:15:11,166 --> 00:15:11,420
Yeah.

436
00:15:11,420 --> 00:15:11,605
Yeah.

437
00:15:11,705 --> 00:15:13,829
And I mean, budgets are all over
the place.

438
00:15:13,829 --> 00:15:16,599
It depends who's actually doing
the work where we'll get really

439
00:15:16,599 --> 00:15:17,123
low budget.

440
00:15:17,123 --> 00:15:18,943
I'll tell our client, you can't

441
00:15:18,843 --> 00:15:19,965
build this house for 500,000.

442
00:15:19,965 --> 00:15:22,452
So we kind of have to go with what

443
00:15:22,452 --> 00:15:23,563
the market's actually going to
cost, right?

444
00:15:23,563 --> 00:15:25,874
So we know what builders charge in
certain locations.

445
00:15:25,874 --> 00:15:30,202
So we kind of already know like
what the price per square foot is

446
00:15:30,202 --> 00:15:33,519
going to be to build that kind of
house and what a pool actually is

447
00:15:33,519 --> 00:15:34,032
going to cost.

448
00:15:34,032 --> 00:15:35,795
It's not just going to cost you

449
00:15:35,795 --> 00:15:38,004
50,000, likely over a hundred
thousand if it's a nice pool,

450
00:15:38,004 --> 00:15:40,701
right?
But lately, I have seen a lot of

451
00:15:40,701 --> 00:15:43,460
budgets coming in very high and
the comparables just don't support

452
00:15:43,460 --> 00:15:44,689
what it costs to build anymore.

453
00:15:44,517 --> 00:15:44,711
So they do get a little tricky.

454
00:15:44,681 --> 00:15:49,604
It is tough for a builder.

455
00:15:49,604 --> 00:15:50,351
We're not even talking about

456
00:15:50,251 --> 00:15:51,178
carrying costs for a year at high
interest rates, right?

457
00:15:51,178 --> 00:15:51,509
Well, yeah, I'm curious.

458
00:15:51,488 --> 00:15:52,240
Do you have like a rule of thumb

459
00:15:52,218 --> 00:15:53,680
right now or something generic
that you've kind of seen, like is

460
00:15:53,680 --> 00:15:56,702
the cost to build 10 to 15% more
expensive than comparables right

461
00:15:56,602 --> 00:15:57,001
now?
Like I'm just trying to wrap my

462
00:15:57,001 --> 00:15:59,029
head around how builders can
justify continuing to build, which

463
00:15:59,029 --> 00:16:01,906
obviously a lot aren't right now,
but a lot have slowed down.

464
00:16:01,906 --> 00:16:04,693
It depends when they bought their
when they bought their lot, right?

465
00:16:04,693 --> 00:16:09,910
Because a lot of the profits in
there, if they got in when it was

466
00:16:09,910 --> 00:16:14,168
cheap, but a lot of the lots have,
you know, over doubled in value

467
00:16:14,168 --> 00:16:14,622
now.

468
00:16:14,622 --> 00:16:16,300
So, you know, if they bought five

469
00:16:16,288 --> 00:16:19,922
or 10 lots at a good time, you
know, now they're sitting pretty

470
00:16:19,922 --> 00:16:21,471
good because all their profits
still there.

471
00:16:21,471 --> 00:16:21,756
Right.

472
00:16:21,756 --> 00:16:24,142
But if you have to go buy a lot

473
00:16:24,142 --> 00:16:27,920
now, and there's not a lot out
there right now and then it build,

474
00:16:27,920 --> 00:16:31,159
it not just, a lot out there right
now, and then build, it really

475
00:16:31,259 --> 00:16:33,703
doesn't make sense right now
because people just aren't pulling

476
00:16:33,703 --> 00:16:36,831
the trigger on a lot of that
high-end stuff when it's over,

477
00:16:36,831 --> 00:16:37,721
say, 2 million.

478
00:16:37,721 --> 00:16:38,675
Everything is just sitting there

479
00:16:38,675 --> 00:16:39,120
right now.

480
00:16:39,120 --> 00:16:40,463
So I think it's just a waiting

481
00:16:40,463 --> 00:16:41,280
game right now.

482
00:16:41,280 --> 00:16:43,031
So I think the market will turn in

483
00:16:43,031 --> 00:16:43,907
the spring, though.

484
00:16:43,807 --> 00:16:44,121
now.

485
00:16:44,121 --> 00:16:46,106
Yeah, well, what have you seen in
the 2024 market?

486
00:16:46,006 --> 00:16:49,600
And what do you think is going to
happen in 2025?

487
00:16:49,600 --> 00:16:50,420
Crystal ball.

488
00:16:50,420 --> 00:16:51,440
Oh, easy question.

489
00:16:51,440 --> 00:16:52,976
No, it's super easy.

490
00:16:52,976 --> 00:16:54,646
You know, this question a lot,

491
00:16:54,646 --> 00:16:57,830
right?
Like, is it a good time to get the

492
00:16:57,830 --> 00:16:59,087
appraisal done?
It's all based on interest rates,

493
00:16:59,087 --> 00:17:00,793
right?
I mean, people just can't afford

494
00:17:00,793 --> 00:17:05,195
or qualify, but you know, they are
trying to improve things for

495
00:17:05,096 --> 00:17:06,330
first-time home buyers and the
market in general.

496
00:17:06,330 --> 00:17:09,108
So I think rates are trending the
right way now.

497
00:17:09,108 --> 00:17:11,353
Hopefully on December 11th, we see
another drop here.

498
00:17:11,353 --> 00:17:16,174
But like you guys know, it's very
seasonal here in the Okanagan, but

499
00:17:16,174 --> 00:17:19,749
I don't feel like the real estate
market has followed its normal

500
00:17:19,749 --> 00:17:21,180
trend where January, February is
slow.

501
00:17:21,180 --> 00:17:22,443
Springtime, it goes crazy.

502
00:17:22,343 --> 00:17:23,917
Sum it goes crazy summertime slows

503
00:17:23,818 --> 00:17:26,160
down fall it picks up again winter
it drops again but lately after

504
00:17:26,160 --> 00:17:28,292
covid it's just been all over the
place like yes we've been

505
00:17:28,292 --> 00:17:30,308
extremely busy and our slowest
times usually in the past right so

506
00:17:30,408 --> 00:17:33,536
i guess what's made refinances
yeah that'd make a lot of sense

507
00:17:33,436 --> 00:17:36,114
yeah so 2024 in the beginning was
still slow because rates were

508
00:17:36,014 --> 00:17:36,841
still high, obviously.

509
00:17:36,841 --> 00:17:38,345
Things are improving.

510
00:17:38,345 --> 00:17:41,651
I'm noticing that right around
that million mark, a lot of buyers

511
00:17:41,651 --> 00:17:42,777
can still qualify, especially
homes with suites, pretty

512
00:17:42,677 --> 00:17:42,839
desirable.

513
00:17:42,839 --> 00:17:44,028
But anything over that 1.5 mark,

514
00:17:44,028 --> 00:17:44,698
it's still pretty slow.

515
00:17:44,624 --> 00:17:44,949
I think people are waiting.

516
00:17:44,775 --> 00:17:48,305
But I do think that by March,
April, May next year, you're going

517
00:17:48,247 --> 00:17:49,579
to see some people jumping off the
fence and getting back in the

518
00:17:49,579 --> 00:17:52,740
market and potentially see some
multiple offer situations again in

519
00:17:52,740 --> 00:17:54,992
a heated up spring market here.

520
00:17:54,969 --> 00:17:55,501
So hopefully.

521
00:17:55,501 --> 00:17:56,234
So buy now.

522
00:17:56,234 --> 00:17:56,516
Buy now.

523
00:17:56,516 --> 00:17:57,469
You're going to probably, yeah.

524
00:17:57,457 --> 00:17:59,193
I mean, I don't know for sure, but

525
00:17:59,175 --> 00:18:01,186
there's some deals out there right
now, right?

526
00:18:01,186 --> 00:18:02,037
If you can.

527
00:18:02,037 --> 00:18:03,720
There are some deals out There

528
00:18:04,000 --> 00:18:04,341
definitely there.

529
00:18:04,329 --> 00:18:05,224
are some deals out there right

530
00:18:05,224 --> 00:18:07,763
right?
If you now, There are some can.

531
00:18:07,863 --> 00:18:09,205
deals out there.

532
00:18:09,205 --> 00:18:11,188
There definitely are some deals

533
00:18:11,188 --> 00:18:11,999
out there.

534
00:18:12,099 --> 00:18:12,459
Yeah.

535
00:18:12,359 --> 00:18:15,485
So do you get a lot of questions
about appraisal versus assessment

536
00:18:15,485 --> 00:18:17,448
value?
Like I answer this question all

537
00:18:17,548 --> 00:18:21,693
the time, but I'm wondering from
your point of view, how do you

538
00:18:21,793 --> 00:18:22,997
answer that question?
We do.

539
00:18:22,997 --> 00:18:25,157
I mean, they're all over the
place.

540
00:18:25,158 --> 00:18:26,260
Like, you know, right?
Yeah.

541
00:18:26,260 --> 00:18:29,478
And we always tell our clients,
you know, before you order the

542
00:18:29,578 --> 00:18:32,965
appraisal and you think it's 2
million,, do a little bit of

543
00:18:32,965 --> 00:18:33,213
homework.

544
00:18:33,213 --> 00:18:35,194
Take a look at the property, see

545
00:18:35,194 --> 00:18:38,186
what you're really dealing with
and see if the value is actually

546
00:18:38,186 --> 00:18:40,210
going to be even close to that.

547
00:18:40,210 --> 00:18:43,482
I mean, BC assessment is kind of a

548
00:18:43,382 --> 00:18:46,820
good starting point just to get an
idea of, okay, well, it's assessed

549
00:18:46,820 --> 00:18:47,226
here.

550
00:18:47,226 --> 00:18:48,988
But lately, I have been noticing

551
00:18:48,988 --> 00:18:52,240
that a lot of the values have been
coming in below assessed value.

552
00:18:52,240 --> 00:18:54,681
Once it's not for every again,
property.

553
00:18:54,681 --> 00:18:56,493
Every location is so different up
here.

554
00:18:56,493 --> 00:19:00,132
From a newer house, from an older
house, from Rutland to Upper

555
00:19:00,132 --> 00:19:01,485
Mission, they're all over the
place.

556
00:19:01,485 --> 00:19:06,260
And BC Assessment doesn't know if
they actually put a pool in

557
00:19:07,040 --> 00:19:09,101
sometimes, if they've renovated
the place.

558
00:19:09,101 --> 00:19:11,797
So there's a lot of factors that
can be missed.

559
00:19:11,797 --> 00:19:17,263
That's why an appraisal is always
good to actually pinpoint a value.

560
00:19:17,263 --> 00:19:21,420
But at least BC Assessment gives
you a starting point.

561
00:19:21,420 --> 00:19:24,005
And keep in mind, like BC
assessment, those values are based

562
00:19:24,005 --> 00:19:27,293
on July dates, right?
So market can shift quite a bit

563
00:19:27,293 --> 00:19:28,817
from July to where we are now,
right?

564
00:19:28,817 --> 00:19:33,821
But it is a good starting point to
get an idea of where it might fall

565
00:19:33,821 --> 00:19:34,224
in.

566
00:19:34,224 --> 00:19:37,796
So we always tell our clients if

567
00:19:37,796 --> 00:19:39,372
they're really unsure, do a bit of
homework.

568
00:19:39,472 --> 00:19:40,850
And we do offer a pre-estimate
service.

569
00:19:40,850 --> 00:19:44,418
If you're really unsure, you can
reach out to us and we can try to

570
00:19:44,418 --> 00:19:45,098
like ballpark where it may come in
at.

571
00:19:44,932 --> 00:19:45,290
If it's even worth getting the
appraisal done, if you're already

572
00:19:45,254 --> 00:19:46,250
like 300K short, well, maybe hold
off until the market picks up a

573
00:19:46,250 --> 00:19:46,657
bit, right?
So yeah.

574
00:19:46,657 --> 00:19:48,089
Yeah, actually, that's a good
point.

575
00:19:48,089 --> 00:19:51,145
What does that service entail?
So it's a free service we offer to

576
00:19:51,139 --> 00:19:51,601
our clients.

577
00:19:51,577 --> 00:19:52,539
And if there's enough information

578
00:19:52,539 --> 00:19:54,539
online, you know, and it's not a
super complex property, we can

579
00:19:54,539 --> 00:19:57,594
kind of have a decent idea of
where it might fall.

580
00:19:57,594 --> 00:20:01,169
You know, the gap might be pretty
large we provide, but at least it

581
00:20:01,269 --> 00:20:05,731
kind of gives you an idea of like,
if you even have a chance to get

582
00:20:05,731 --> 00:20:07,104
the deal done or not.

583
00:20:07,104 --> 00:20:09,195
So I'll send you a property right

584
00:20:09,195 --> 00:20:11,420
send you a property right after
the show then.

585
00:20:11,420 --> 00:20:11,550
Perfect.

586
00:20:11,550 --> 00:20:13,755
Got a refi on the go and there's a

587
00:20:13,855 --> 00:20:14,209
big gap.

588
00:20:14,209 --> 00:20:15,701
So yeah, saves time and money.

589
00:20:15,701 --> 00:20:16,551
So yeah.

590
00:20:16,551 --> 00:20:17,545
What's like the most detrimental

591
00:20:17,645 --> 00:20:21,320
thing that you see clients do to
their house that kind of devalues

592
00:20:21,320 --> 00:20:21,618
it.

593
00:20:21,618 --> 00:20:23,330
And then on the opposite to that

594
00:20:23,330 --> 00:20:27,220
is like, what's the biggest value
add that people can do, you know,

595
00:20:28,860 --> 00:20:34,767
like pre getting an appraisal or
pre selling their house, whether

596
00:20:34,815 --> 00:20:36,453
it's a simple, like, you know,
clean up and paint some walls and

597
00:20:36,453 --> 00:20:38,015
brighten up the space, light
fixtures, or like as big as, you

598
00:20:38,015 --> 00:20:39,400
know, Hey, bathrooms or garages,
or like, what's kind of the

599
00:20:39,900 --> 00:20:41,450
biggest value add and what's the
biggest mistake people make?

600
00:20:41,450 --> 00:20:43,607
Well, typically, you know,
kitchens go a long ways.

601
00:20:43,588 --> 00:20:46,741
If you spend some decent money on
a kitchen and bathrooms, I see

602
00:20:46,741 --> 00:20:50,178
like that's the best way to add
value to your house.

603
00:20:50,078 --> 00:20:55,054
The worst thing to do, I think, is
having the nicest house in the

604
00:20:55,054 --> 00:20:55,140
street.

605
00:20:55,140 --> 00:20:56,850
And if you're not in the greatest

606
00:20:56,950 --> 00:20:59,974
area and you've just spent $30,000
on a fridge that you really like,

607
00:20:59,974 --> 00:21:02,963
and we see that, they say, well,
look at this fridge, it's got to

608
00:21:02,963 --> 00:21:03,850
be worth 50.

609
00:21:03,950 --> 00:21:04,737
Well, you know, maybe don't

610
00:21:04,837 --> 00:21:07,220
overspend just for yourself,
because you like it, because

611
00:21:07,660 --> 00:21:09,413
doesn't mean the market's gonna
like it.

612
00:21:09,413 --> 00:21:11,367
So we've seen some renovations in
areas that aren't the greatest

613
00:21:11,367 --> 00:21:15,126
where you know, that could be a
bit of a waste of time and money

614
00:21:15,126 --> 00:21:17,725
where you're not probably going to
get it back, right?

615
00:21:17,725 --> 00:21:19,780
And just overspending on things
that just the market's not willing

616
00:21:20,100 --> 00:21:22,558
to pay extra for, you're probably
going to lose that money.

617
00:21:22,558 --> 00:21:25,522
And we always tell our clients if
they're doing a purchase plus

618
00:21:25,522 --> 00:21:29,184
improvements to get the appraisal
done before they start ripping

619
00:21:29,284 --> 00:21:30,376
apart the kitchen, the house.

620
00:21:30,376 --> 00:21:32,660
Because if the lender wants the

621
00:21:32,660 --> 00:21:35,140
as-is value, you've actually taken
away value from the property.

622
00:21:35,140 --> 00:21:38,012
So I would suggest and give advice
to your clients saying like, if

623
00:21:38,012 --> 00:21:39,628
you're doing a purchase plus
improvements to just hold off on

624
00:21:39,728 --> 00:21:42,052
the renovation until you get the
appraisal done before you start

625
00:21:42,052 --> 00:21:44,168
ripping the house apart, because
you're actually taking value away

626
00:21:44,167 --> 00:21:44,560
it.

627
00:21:44,560 --> 00:21:44,118
from your house.

628
00:21:44,118 --> 00:21:46,420
If you start that renovation a
little too early.

629
00:21:46,680 --> 00:21:46,864
early.

630
00:21:46,864 --> 00:21:48,210
It seems wild that you have to

631
00:21:48,210 --> 00:21:50,363
state that, but I run into the
same issue.

632
00:21:50,363 --> 00:21:50,800
Yeah.

633
00:21:51,000 --> 00:21:55,141
Hey guys, like we need to get the

634
00:21:55,141 --> 00:21:55,722
appraisal done.

635
00:21:55,722 --> 00:21:57,716
Just like, don't do anything to

636
00:21:57,716 --> 00:21:59,088
the house, leave appliances,
whatever.

637
00:21:59,088 --> 00:22:01,722
And then you see the photos and
like, you know, half the house is

638
00:22:01,722 --> 00:22:01,969
missing.

639
00:22:01,969 --> 00:22:03,206
You're like, what did you expect

640
00:22:03,306 --> 00:22:05,808
was going to happen?
Avoid that if you can.

641
00:22:05,808 --> 00:22:06,700
So yeah.

642
00:22:06,800 --> 00:22:07,246
Okay.

643
00:22:07,146 --> 00:22:10,924
So what's the difference that you
see between a house having a legal

644
00:22:10,924 --> 00:22:14,260
suite and a non-conforming suite?
Like, is there a big appraisal

645
00:22:14,260 --> 00:22:16,640
difference when you go through a
house like that?

646
00:22:16,740 --> 00:22:19,880
I mean, it definitely adds value
and adds value and have a legal

647
00:22:19,880 --> 00:22:20,900
suite for sure.

648
00:22:20,900 --> 00:22:22,824
A hundred percent definitely adds

649
00:22:22,924 --> 00:22:23,256
value.

650
00:22:23,156 --> 00:22:24,615
I mean, it's done the code.

651
00:22:24,615 --> 00:22:26,340
It's got, you know, the right
construction done.

652
00:22:26,340 --> 00:22:28,596
It's got the extra insulation in
the house.

653
00:22:28,596 --> 00:22:29,429
So definitely adds value.

654
00:22:29,429 --> 00:22:31,126
I mean, every suite, in my

655
00:22:31,126 --> 00:22:33,339
opinion, this current market
definitely adds value to the

656
00:22:33,339 --> 00:22:34,004
overall market.

657
00:22:34,004 --> 00:22:36,228
It's that extra rent you can get.

658
00:22:36,228 --> 00:22:40,051
And the rental market, there's a
lot going on the rental market

659
00:22:40,051 --> 00:22:40,620
right now.

660
00:22:40,620 --> 00:22:42,551
But I do think that people are

661
00:22:42,651 --> 00:22:44,334
always going to need space to
rent.

662
00:22:44,334 --> 00:22:47,929
So I do see a lot of demand for
homes that have that secondary

663
00:22:47,929 --> 00:22:48,951
suite in it.

664
00:22:49,051 --> 00:22:51,060
So it definitely adds value having

665
00:22:51,060 --> 00:22:55,365
the suite and the right setup of a
suite, you know, not one that you

666
00:22:55,365 --> 00:22:57,052
share the backyard with maybe.

667
00:22:57,052 --> 00:22:58,558
So, you know, all suites are set

668
00:22:58,558 --> 00:23:01,440
up differently, but if you can
have one where you don't even

669
00:23:01,440 --> 00:23:04,127
notice your tenants there, those
are usually the best, you know,

670
00:23:04,127 --> 00:23:08,504
not sharing the yard with them or,
you know, having it off to a

671
00:23:08,504 --> 00:23:11,483
certain area of the house where
you can't really hear them as much

672
00:23:11,483 --> 00:23:12,206
definitely adds value.

673
00:23:12,206 --> 00:23:13,820
So, and legal suites definitely

674
00:23:13,820 --> 00:23:16,215
add more value than a, you know, a
non-legal suite.

675
00:23:16,315 --> 00:23:19,252
We try to avoid that term legal in
our reports.

676
00:23:19,252 --> 00:23:23,974
We either say like it either
conforms to the zoning or it

677
00:23:23,974 --> 00:23:24,437
doesn't basically.

678
00:23:24,437 --> 00:23:26,290
And the majority of the zoning

679
00:23:26,290 --> 00:23:29,288
here in Kelowna and the Fraser
Valley and everywhere do allow a

680
00:23:29,288 --> 00:23:31,125
suite, but that doesn't really
necessarily mean it's actually a

681
00:23:31,125 --> 00:23:31,707
legal suite.

682
00:23:31,707 --> 00:23:33,309
So we do avoid using that term,

683
00:23:33,409 --> 00:23:37,283
but if zoning does permit a suite,
we will say, yes, the zoning does

684
00:23:37,283 --> 00:23:38,606
allow the suite.

685
00:23:38,606 --> 00:23:40,377
And we don't confirm if it's

686
00:23:40,377 --> 00:23:41,315
actually a legal suite.

687
00:23:41,315 --> 00:23:42,663
It's out of our scope to contact

688
00:23:42,663 --> 00:23:45,521
the city and say, Hey, this
address has a suite.

689
00:23:45,521 --> 00:23:47,431
Can you tell me if it's legal or
not?

690
00:23:47,331 --> 00:23:50,327
Because then they may go knock on
the door and then you have an

691
00:23:50,327 --> 00:23:50,481
issue.

692
00:23:50,481 --> 00:23:52,227
So that is out of our scope to

693
00:23:52,227 --> 00:23:53,865
confirm all that information.

694
00:23:53,765 --> 00:23:56,420
So we do definitely just go by if

695
00:23:56,640 --> 00:24:00,702
the, you know, the RU1 zoning
allows a secondary suite, then in

696
00:24:00,702 --> 00:24:03,436
our reports, we'll say, yes, this
zoning does allow for a suite.

697
00:24:03,436 --> 00:24:03,654
So, okay.

698
00:24:03,654 --> 00:24:04,420
Interesting.

699
00:24:04,420 --> 00:24:07,169
In terms of like purchase plus, I
mean, there are grants and new

700
00:24:07,169 --> 00:24:09,650
legislation being changed for, you
know, basically adding suites and

701
00:24:09,650 --> 00:24:10,148
basements that's coming up in
2025.

702
00:24:10,148 --> 00:24:12,980
Do you guys do a purchase plus
improvement market evaluation for

703
00:24:12,980 --> 00:24:14,336
clients before they start that
project?

704
00:24:14,336 --> 00:24:18,170
And you say like, yes, if you did
add a suite in this location and

705
00:24:18,170 --> 00:24:23,299
it was a one bedroom, one bath, et
cetera, you know, we would

706
00:24:23,399 --> 00:24:27,738
probably come back in six months
and appraise it at X amount of

707
00:24:27,738 --> 00:24:29,337
dollars more.

708
00:24:29,237 --> 00:24:31,698
Like, is that a service you

709
00:24:31,798 --> 00:24:34,925
provide?
So it takes the guesswork out.

710
00:24:34,925 --> 00:24:35,447
the guesswork out.

711
00:24:35,447 --> 00:24:35,736
Yeah, definitely.

712
00:24:35,736 --> 00:24:36,084
Yeah.

713
00:24:36,084 --> 00:24:37,300
And even if they want a

714
00:24:37,300 --> 00:24:40,765
hypothetical value of, you know,
of a two bedroom suite being built

715
00:24:40,665 --> 00:24:43,661
in the house, we can give the
hypothetical if the lender is

716
00:24:43,661 --> 00:24:45,721
willing to accept that.

717
00:24:45,721 --> 00:24:48,145
And we can also give you a

718
00:24:48,145 --> 00:24:50,296
hypothetical rent on a suite to be
built.

719
00:24:50,296 --> 00:24:51,945
We get that quite a bit actually.

720
00:24:51,945 --> 00:24:53,793
They've bought the house, it's got

721
00:24:53,893 --> 00:24:56,951
an unfinished basement and the
lender will say, yeah, what is the

722
00:24:56,951 --> 00:24:58,613
potential rent it can get once the
suite's built?

723
00:24:58,613 --> 00:25:00,243
And we can provide that service as
well.

724
00:25:00,243 --> 00:25:03,091
That's a really good point that I
think a lot of people don't know

725
00:25:03,191 --> 00:25:06,215
of those programs is you can a
really good point that I think a

726
00:25:06,215 --> 00:25:09,860
lot of people don't know of those
programs is you can do exactly

727
00:25:09,860 --> 00:25:11,943
that, like projected income on
that hypothetical suite.

728
00:25:11,843 --> 00:25:14,700
And then we can use that projected
income in the application to help

729
00:25:14,700 --> 00:25:16,148
the approval, which is just
amazing.

730
00:25:16,148 --> 00:25:19,251
So if anyone out there is looking
to basically switch over their

731
00:25:19,251 --> 00:25:22,119
suite, obviously contact Derek and
talk about those numbers.

732
00:25:22,119 --> 00:25:22,745
Yeah, anytime.

733
00:25:22,745 --> 00:25:25,042
Derek, I have a question about GST

734
00:25:25,042 --> 00:25:28,807
when you're selling a new build
like i know you can finance gst

735
00:25:28,807 --> 00:25:32,116
but when you do your appraisal
like your prices include gst or it

736
00:25:32,116 --> 00:25:37,491
does yeah so if we do it does yeah
so if we do a new build we'll say

737
00:25:37,491 --> 00:25:40,043
you know that final complete value
is 2.5 and that includes the net

738
00:25:40,043 --> 00:25:43,321
gst yeah okay and so vacant lot
sales though we always say plus

739
00:25:43,221 --> 00:25:44,253
applicable gst because it's always
negotiable.

740
00:25:44,253 --> 00:25:47,237
You don't know if it's actually
GST on top of that.

741
00:25:47,237 --> 00:25:49,540
So for vacant land, we do it the
opposite way.

742
00:25:50,000 --> 00:25:53,300
We'll say plus applicable GST if
it is applicable on that lot sale,

743
00:25:53,300 --> 00:25:54,803
if it's already been paid, maybe.

744
00:25:54,803 --> 00:25:56,102
But for any new construction, we

745
00:25:56,102 --> 00:25:58,674
always include the net GST in the
final value.

746
00:25:58,674 --> 00:26:01,606
And for pre-sales as well, right?
So a lot of pre-sales are

747
00:26:01,606 --> 00:26:03,220
completing here in.

748
00:26:03,380 --> 00:26:06,191
you So, know, a lot of pre-sales

749
00:26:06,091 --> 00:26:07,380
are completing here in Kelowna.

750
00:26:07,380 --> 00:26:09,683
There's a ton coming up here.

751
00:26:09,583 --> 00:26:14,106
So like, cause the posted sales
prices are not going to have GST.

752
00:26:14,006 --> 00:26:14,407
That's right.

753
00:26:14,407 --> 00:26:16,816
You just assume that all the

754
00:26:16,816 --> 00:26:20,752
comparables are plus GST, but then
yours is including GST.

755
00:26:20,752 --> 00:26:20,967
Yes.

756
00:26:20,967 --> 00:26:22,615
So, you know, we try to avoid

757
00:26:22,615 --> 00:26:25,747
comparables that actually haven't
completed yet for like high rises.

758
00:26:25,747 --> 00:26:25,860
Okay.

759
00:26:25,860 --> 00:26:27,567
So, you know, we might select like

760
00:26:27,667 --> 00:26:30,320
a one-year-old condo where we know
that the GST is already including

761
00:26:30,320 --> 00:26:30,606
that sale price.

762
00:26:30,606 --> 00:26:30,950
Right.

763
00:26:30,950 --> 00:26:33,698
Or if it's an assignment, we will
call that listing realtor and say,

764
00:26:33,698 --> 00:26:36,844
Hey, was there GST on top of the
459 or whatever it is.

765
00:26:36,844 --> 00:26:36,952
Yeah.

766
00:26:36,952 --> 00:26:38,671
And if they say, no, it's plus

767
00:26:38,671 --> 00:26:41,517
GST, like, you know, typically it
is plus GST that's posted on MLS

768
00:26:41,517 --> 00:26:43,700
unless the realtor has mentioned
that in the comments.

769
00:26:43,700 --> 00:26:46,226
I mean, there's a lot of
developments that are starting to

770
00:26:46,226 --> 00:26:47,845
close in the mid months here.

771
00:26:47,845 --> 00:26:49,076
Are you seeing those be assigned

772
00:26:49,076 --> 00:26:51,837
for a lesser value than what they
sold for three years ago?

773
00:26:51,837 --> 00:26:54,388
Not quite what they sold for three
years ago?

774
00:26:54,288 --> 00:26:54,855
Not quite yet.

775
00:26:54,855 --> 00:26:56,622
I think over the next six months

776
00:26:56,622 --> 00:26:59,651
as more complete and hit the
market, we'll have a better idea

777
00:26:59,651 --> 00:27:00,712
of where they're coming in at.

778
00:27:00,712 --> 00:27:02,026
So we just did close to 50

779
00:27:02,026 --> 00:27:00,459
appraisals in one new building and
it was sold in 2021.

780
00:27:00,459 --> 00:27:02,930
And we pretty much were able to
meet the purchase price on all

781
00:27:02,930 --> 00:27:05,338
those units, it was a good time to
buy.

782
00:27:05,338 --> 00:27:09,327
I know there's a few coming up
that have pre-sold in 2022 in

783
00:27:09,327 --> 00:27:10,928
April when the market spiked.

784
00:27:10,928 --> 00:27:13,338
Those may be a little tricky to

785
00:27:13,238 --> 00:27:16,210
reach those pre-sale prices, just
the way the condo market's going

786
00:27:16,210 --> 00:27:16,840
as well.

787
00:27:16,940 --> 00:27:19,220
And with the new Airbnb rules.

788
00:27:19,220 --> 00:27:19,570
Yeah.

789
00:27:19,570 --> 00:27:22,445
I was going to ask you about that.

790
00:27:22,445 --> 00:27:25,010
Does that change of use affect the
appraisal?

791
00:27:25,010 --> 00:27:25,237
Yeah.

792
00:27:25,237 --> 00:27:27,274
I think it's going to change the

793
00:27:27,274 --> 00:27:28,707
whole economy here, actually, in
Cologne itself.

794
00:27:28,707 --> 00:27:30,970
I mean, it's a vacationville,
right?

795
00:27:30,970 --> 00:27:32,127
Like people rely on Airbnb.

796
00:27:32,127 --> 00:27:31,800
And, you know, this summer, I

797
00:27:31,800 --> 00:27:33,109
didn't even really notice many
tourists come up.

798
00:27:33,109 --> 00:27:34,745
The roads are pretty quiet.

799
00:27:34,745 --> 00:27:37,198
It wasn't the same feel as it

800
00:27:37,198 --> 00:27:39,946
usually is, right?
So I don't think that's a good

801
00:27:39,946 --> 00:27:43,557
thing, especially for the condo
market and, you know, restaurants

802
00:27:43,557 --> 00:27:46,877
and everybody, you know, people
just aren't coming up and wanting

803
00:27:46,877 --> 00:27:49,539
to spend $900 at the grand, you
know, it's very expensive to come

804
00:27:49,539 --> 00:27:49,869
up now.

805
00:27:49,869 --> 00:27:52,431
So with the lack of Airbnb units

806
00:27:52,431 --> 00:27:52,568
available.

807
00:27:52,568 --> 00:27:52,705
Yeah.

808
00:27:52,705 --> 00:27:56,400
And like you point It like you
point out, like, it's not just

809
00:27:56,860 --> 00:28:00,062
those units that are affected
because, you know, it hurts

810
00:28:00,062 --> 00:28:02,356
restaurants and everyone else
that's working in a supported

811
00:28:02,356 --> 00:28:04,287
economy by that so even if
someone's in a single family home

812
00:28:04,287 --> 00:28:05,817
like they're probably still seeing
the ripple effect of that oh yeah

813
00:28:05,817 --> 00:28:09,705
where do you see opportunity in
the market right now or where do

814
00:28:09,705 --> 00:28:12,149
you see kind of the most
transactions or most undervalued

815
00:28:12,249 --> 00:28:15,131
assets like you know matt and i've
kind of discussed before on the

816
00:28:15,131 --> 00:28:18,929
show like condo market seems like
it's going to be flat for a while,

817
00:28:18,929 --> 00:28:21,893
especially with all the products
coming online.

818
00:28:21,893 --> 00:28:26,414
Are you seeing like single family
homes with suites, you all the

819
00:28:26,414 --> 00:28:29,347
know, moving at a faster pace or
yeah.

820
00:28:29,347 --> 00:28:33,570
What are you looking to buy in the
next couple of years as an

821
00:28:33,570 --> 00:28:35,648
investor?
Well, I I mean, the market that's

822
00:28:35,648 --> 00:28:39,009
moving the best right now is, you
know, single family under that

823
00:28:39,009 --> 00:28:41,765
one, two mark I've been seeing,
you know, lot of activity there.

824
00:28:41,865 --> 00:28:44,995
And that's usually where it
usually starts at the lower end

825
00:28:44,995 --> 00:28:47,958
market and moves up if you go over
that one, five mark.

826
00:28:47,958 --> 00:28:50,799
But I think the best opportunity
right now is to find something

827
00:28:50,799 --> 00:28:54,130
between that one, five and 2
million mark that's actually worth

828
00:28:54,230 --> 00:28:54,706
2 million.

829
00:28:54,706 --> 00:28:57,263
You can pick some of those up for

830
00:28:57,263 --> 00:28:58,440
pretty good deal right now and do
that upgrade if you're looking to

831
00:28:58,440 --> 00:29:02,966
you know get into that nicer house
and get that space i think there's

832
00:29:02,966 --> 00:29:07,253
a lot of opportunity there's quite
a few listings out there super

833
00:29:07,253 --> 00:29:10,918
nice homes that usually aren't
available and right now you can

834
00:29:10,818 --> 00:29:15,184
get out there and kind of pick
your favorite one you know work on

835
00:29:15,184 --> 00:29:18,837
a good price so that could change
in the spring so and lakefront

836
00:29:18,837 --> 00:29:21,511
properties i mean they're
lakefront properties, you know,

837
00:29:21,611 --> 00:29:22,491
down by Hobson.

838
00:29:22,491 --> 00:29:23,917
I mean, those that really changed

839
00:29:23,917 --> 00:29:27,570
too much, you know, there's a lot
of money down there.

840
00:29:27,570 --> 00:29:31,045
So they don't really necessarily
need to drop their prices.

841
00:29:31,045 --> 00:29:34,605
They'll just wait for the right
buyer to come through and pick it

842
00:29:34,605 --> 00:29:34,780
up.

843
00:29:34,780 --> 00:29:36,416
So it's weird how those don't

844
00:29:36,416 --> 00:29:36,825
really change.

845
00:29:36,825 --> 00:29:38,716
And typically the buyer for that

846
00:29:38,716 --> 00:29:40,187
doesn't really care about interest
rates.

847
00:29:40,287 --> 00:29:44,343
They've usually coming in with a
cash offer coming up from the

848
00:29:44,343 --> 00:29:45,191
coast or somewhere.

849
00:29:45,191 --> 00:29:46,986
So it's weird how that market

850
00:29:46,986 --> 00:29:50,103
doesn't really care about interest
rates they've usually coming in

851
00:29:50,003 --> 00:29:54,433
with a cash offer coming up from
the coast or somewhere so it's

852
00:29:54,433 --> 00:29:57,994
weird how that market doesn't
really change too much i see i

853
00:29:57,994 --> 00:30:02,731
feel so i think it's such a such a
good time to upgrade or not

854
00:30:02,731 --> 00:30:05,749
upgrade but like upsize if
someone's looking for that larger

855
00:30:05,749 --> 00:30:08,980
home or more space you know as a
whole the market's obviously lower

856
00:30:08,971 --> 00:30:13,588
so now's the time to kind of sell
at a loss and then make up for it

857
00:30:13,588 --> 00:30:14,573
on the purchase side.

858
00:30:14,473 --> 00:30:16,291
It's kind of a tough one for

859
00:30:16,391 --> 00:30:17,454
people to swallow.

860
00:30:17,454 --> 00:30:17,906
Well, and people are budging on

861
00:30:17,906 --> 00:30:19,263
their prices, which is good.

862
00:30:19,263 --> 00:30:20,620
You know, overall, the prices

863
00:30:20,620 --> 00:30:23,718
haven't really dropped too, too
much, really, because people just

864
00:30:23,718 --> 00:30:25,822
don't want to give their homes
away here.

865
00:30:25,822 --> 00:30:28,043
I mean, there's a lot of wealth
here in the Okanagan.

866
00:30:28,043 --> 00:30:31,078
So I don't think people are really
forced to sell.

867
00:30:31,078 --> 00:30:34,431
We had a few listings up by our
place here and people just they

868
00:30:34,431 --> 00:30:37,618
took them off the market because
they weren't willing to just give

869
00:30:37,618 --> 00:30:40,791
them away and maybe they'll relist
in the spring but not really

870
00:30:40,791 --> 00:30:42,974
seeing people just giving their
homes away they're just they're

871
00:30:42,974 --> 00:30:45,586
keeping that there has not like
we've talked about this before but

872
00:30:45,586 --> 00:30:48,664
like seeing like the media
narrative that there's just so

873
00:30:48,664 --> 00:30:52,205
many distressed sellers when it's
just not like that in reality like

874
00:30:52,205 --> 00:30:54,490
no i totally agree with you that
most people will just wait.

875
00:30:54,490 --> 00:30:54,632
Yeah.

876
00:30:54,632 --> 00:30:54,726
Right?

877
00:30:54,726 --> 00:30:55,762
They'll just wait for the right
price.

878
00:30:55,762 --> 00:30:55,856
Yeah.

879
00:30:55,856 --> 00:30:57,106
Obviously, there always are a few

880
00:30:57,106 --> 00:31:00,055
here and there, but they're not
enough to bring down the market.

881
00:31:00,055 --> 00:31:00,409
No.

882
00:31:00,409 --> 00:31:01,987
No. I mean, it's a pretty

883
00:31:01,987 --> 00:31:05,754
desirable place to a pretty
desirable place to live, as we all

884
00:31:05,754 --> 00:31:06,103
know.

885
00:31:06,103 --> 00:31:08,057
So I think it'll just be getting

886
00:31:08,057 --> 00:31:08,476
better.

887
00:31:08,476 --> 00:31:10,220
Even if you went to fire sale your

888
00:31:10,320 --> 00:31:13,190
property, there's so many people
on the sidelines, like pent up

889
00:31:13,190 --> 00:31:13,520
demand waiting.

890
00:31:13,520 --> 00:31:13,652
Yes.

891
00:31:13,652 --> 00:31:16,048
It's not going to go for way
undervalued.

892
00:31:16,048 --> 00:31:19,102
Like, you know, people are just
going to start buying those if

893
00:31:19,102 --> 00:31:19,897
there is value there.

894
00:31:19,897 --> 00:31:20,468
So yeah.

895
00:31:20,468 --> 00:31:20,985
All right.

896
00:31:20,985 --> 00:31:23,052
If you could give your 20 year old

897
00:31:23,052 --> 00:31:25,120
self any piece of advice, what
would it be?

898
00:31:25,120 --> 00:31:27,520
of advice, what would it be?
Oh, that's a good question.

899
00:31:27,520 --> 00:31:30,116
I think just working on building
those trusted business

900
00:31:30,116 --> 00:31:32,278
relationships and partnerships
right from the start.

901
00:31:32,278 --> 00:31:35,953
Kelowna has been a great area to,
you know, build this business up.

902
00:31:35,953 --> 00:31:39,500
There's a lot of good people that
work here and we've built up a lot

903
00:31:39,500 --> 00:31:41,058
of great relationships and trusted
relationships.

904
00:31:41,058 --> 00:31:45,160
I think that's the number one
thing is just getting out there

905
00:31:45,700 --> 00:31:46,718
and meeting people.

906
00:31:46,618 --> 00:31:48,808
It goes a long ways in this

907
00:31:48,908 --> 00:31:49,826
business, at least.

908
00:31:49,726 --> 00:31:51,280
I I agree There are agree.

909
00:31:51,380 --> 00:31:52,915
so a long Yeah, ways in this
totally.

910
00:31:52,883 --> 00:31:53,348
at I agree.

911
00:31:53,448 --> 00:31:53,938
business, least.

912
00:31:53,938 --> 00:31:54,529
Yeah, I agree totally.

913
00:31:54,529 --> 00:31:55,829
There are so many good

914
00:31:55,829 --> 00:31:56,655
professionals in the Kelowna
market.

915
00:31:56,555 --> 00:31:59,655
Like, I mean, I don't know any
other markets, but like from

916
00:31:59,655 --> 00:32:01,912
lawyers to appraisers, like
everyone here just seems to want

917
00:32:01,812 --> 00:32:02,800
to work together collectively.

918
00:32:02,800 --> 00:32:03,530
So yeah, it's nice to see.

919
00:32:03,530 --> 00:32:03,730
Yeah.

920
00:32:03,652 --> 00:32:04,324
What's your favorite charity or

921
00:32:04,324 --> 00:32:06,278
how do you guys give back?
We do charity for Can knox place

922
00:32:06,278 --> 00:32:07,836
that's a good one for us also had
some uh family history there too

923
00:32:07,836 --> 00:32:09,688
so it's close to my heart so
that's a pretty good one that we

924
00:32:09,668 --> 00:32:11,999
kind of focus on we've also helped
out and donate to ukraine um in

925
00:32:11,999 --> 00:32:16,873
the past so there's quite a few so
you kind of have to select the

926
00:32:16,873 --> 00:32:21,229
ones that you kind of stick with
and go from there so good for for

927
00:32:21,229 --> 00:32:21,611
you.

928
00:32:21,611 --> 00:32:22,188
Those are awesome.

929
00:32:22,188 --> 00:32:22,420
awesome.

930
00:32:22,420 --> 00:32:23,347
All right, Derek, how can Taylor

931
00:32:23,347 --> 00:32:25,874
or I help you stop sending them
rush deals on a Friday?

932
00:32:25,867 --> 00:32:26,400
No, I'll be here.

933
00:32:26,400 --> 00:32:29,106
I'll get them out no matter what.

934
00:32:29,106 --> 00:32:32,106
I mean, I guess just relaying your
experience to other potential, you

935
00:32:32,006 --> 00:32:35,920
know, clients or, you know, people
that you work with in the

936
00:32:35,920 --> 00:32:37,630
industry, letting them know how
your experience has been with our

937
00:32:37,720 --> 00:32:37,920
firm.

938
00:32:37,817 --> 00:32:38,568
We operate a little differently

939
00:32:38,568 --> 00:32:39,933
where we like to build up our
relationships.

940
00:32:39,933 --> 00:32:42,513
We feel like we're in the customer
service industry rather than just

941
00:32:42,513 --> 00:32:43,476
providing a product for our
clients.

942
00:32:43,476 --> 00:32:45,986
So we get on the phone, we'll
discuss the values with them after

943
00:32:45,978 --> 00:32:47,526
hours, before, when we get to
work, anytime.

944
00:32:47,518 --> 00:32:49,707
So it's always good to just,
rather than send the appraisal

945
00:32:49,707 --> 00:32:52,086
through, if you have any
questions, we're there to answer

946
00:32:52,086 --> 00:32:54,794
your questions and kind of just
give you a reasoning why we're

947
00:32:54,794 --> 00:32:55,971
coming in where we are.

948
00:32:55,971 --> 00:32:58,144
And yeah, we just want to have

949
00:32:58,144 --> 00:33:01,740
that customer service level and
just go above and beyond for our

950
00:33:01,740 --> 00:33:04,291
clients and pick up the phone,
call them and build that

951
00:33:04,291 --> 00:33:04,801
relationship up.

952
00:33:04,801 --> 00:33:07,421
So that's why I think we stand out

953
00:33:07,421 --> 00:33:11,267
a little bit more than some others
as we really focus on the customer

954
00:33:11,267 --> 00:33:13,140
service part of our business and
the appraisal side.

955
00:33:13,440 --> 00:33:14,320
Yeah, absolutely.

956
00:33:14,420 --> 00:33:15,562
I can vouch for that.

957
00:33:15,562 --> 00:33:15,159
You guys are incredible.

958
00:33:15,159 --> 00:33:17,242
And, you know, for the cost of

959
00:33:17,242 --> 00:33:21,511
transaction of, you know, buying a
million dollar house, the fee for

960
00:33:21,511 --> 00:33:24,499
an appraisal is so small and
comparable that, you know, if

961
00:33:24,499 --> 00:33:28,169
you're trying to save 50 bucks
between one appraiser or the

962
00:33:28,169 --> 00:33:30,756
other, like having somebody that
does the report correctly on time

963
00:33:30,656 --> 00:33:33,005
provides it to allow you to remove
subjects or just, you know,

964
00:33:33,005 --> 00:33:34,148
highlights any issues with the
property.

965
00:33:34,248 --> 00:33:35,806
Like it's an insurance at this
point, right?

966
00:33:35,806 --> 00:33:36,991
Like it really is a necessary
insurance.

967
00:33:36,991 --> 00:33:37,405
So yeah, I've always appreciated
working with you guys.

968
00:33:37,405 --> 00:33:38,417
So thank you.

969
00:33:38,417 --> 00:33:39,048
I appreciate that.

970
00:33:38,948 --> 00:33:42,068
I think the second review process
helps the second review process

971
00:33:42,068 --> 00:33:48,051
helps too, because you know, the
odd thing can get missed in there.

972
00:33:48,051 --> 00:33:50,980
So having that second set of eyes
really goes a long ways.

973
00:33:50,980 --> 00:33:53,230
And from somebody that's actually
focusing on that specific market

974
00:33:53,230 --> 00:33:54,451
also goes a long ways too.

975
00:33:54,451 --> 00:33:54,901
So yeah.

976
00:33:54,901 --> 00:33:55,737
Fantastic.

977
00:33:55,737 --> 00:33:58,470
Well, thank you so much for

978
00:33:58,470 --> 00:33:59,616
joining us Thanks today.

979
00:33:59,616 --> 00:34:00,021
for Yeah.

980
00:34:00,021 --> 00:34:01,236
having I appreciate me.

981
00:34:01,236 --> 00:34:01,708
Yeah.

982
00:34:01,708 --> 00:34:02,462
So you.

983
00:34:02,462 --> 00:34:02,706
yeah.

984
00:34:02,706 --> 00:34:02,767
Fantastic.

985
00:34:02,767 --> 00:34:04,294
thank you so Well, much for

986
00:34:04,294 --> 00:34:05,248
joining us today.

987
00:34:05,202 --> 00:34:05,325
much for joining us Thanks today.

988
00:34:05,278 --> 00:34:05,400
for Yeah.

989
00:34:05,291 --> 00:34:05,400
having I appreciate me.

990
00:34:05,352 --> 00:34:05,400
Yeah.

991
00:34:05,378 --> 00:34:05,400
So you.

992
00:34:05,423 --> 00:34:05,400
yeah.

993
00:34:05,458 --> 00:34:05,400
Fantastic.

994
00:34:05,620 --> 00:34:07,424
thank you so Well, much for
joining us today.

995
00:34:07,424 --> 00:34:07,648
Yeah.

996
00:34:07,648 --> 00:34:09,047
Thanks for having me.

997
00:34:09,047 --> 00:34:09,440
Yeah.

998
00:34:09,659 --> 00:34:10,195
I appreciate you.

999
00:34:10,094 --> 00:34:11,677
So keep up the good work out
there.

1000
00:34:11,677 --> 00:34:15,690
As soon as you know of any, you
know, fire sales, let Matt and I

1001
00:34:15,690 --> 00:34:17,306
know about it.

1002
00:34:17,407 --> 00:34:17,773
Okay.

1003
00:34:17,672 --> 00:34:20,232
Well do take care of of guys.