In today’s post, I’ve interviewed a good friend of my HB and I’s. He actually grew up with my HB and was the M.C. at our wedding. But more importantly, he’s also a realtor in the greater Vancouver area, and was nice enough to let me interview him about all things real estate!
His name is Hiroshi Kubota and is a realtor for Keller Williams. Just an fyi, this is not a sponsored post or anything like that, I just thought it would be a good idea to interview him since he’s been our go-to real estate advice guy since he started his career.
Me: Thanks Hiroshi for letting me interview you. I think it was bound to happen considering I’ve got a personal finance blog and me and the HB are currently house hunting. Okay, let’s get right to it. How long have you been a realtor and how did you get into that line of business?
Hiroshi: It’ll be 6 years in April. What happened was, after I graduated high school I didn’t really know what I wanted to get into. I thought I wanted to do engineering and architecture, but I guess I didn’t really have a passion for it. So, I took a year off and talked to a few people about what I should do and someone recommended that I look into studying business.
That person also recommended that I read “Rich Dad, Poor Dad.” For some reason, that day I went straight to Chapters and bought the book. Once I started reading it, I just loved it. And that kind of became my bible. And even though the book doesn’t help people get into real estate, it still peaked that interest for me in real estate.
When I turned 21, I bought my condo, and I had a great realtor at the time, and my interest just continued to grow. So, I did this real estate course and got my license. And 6 years later I still love what I do. It’s great being able to help people through one of their big life events.
Me: Awesome. So, since my HB and I are currently looking for our first place, and since there are a number of other new or prospective home buyers out there reading this post, can you break down what the home buying process looks like at a glance? What are the main steps from starting as a prospective buyer to eventually being a homeowner?
Hiroshi: If you know somebody in real estate, I’d suggest talking to them first. Let them know that you’re starting to look and they can help set you up with either a banker or a mortgage broker so you can find out how much you’ll get pre-approved for.
And here’s the trick. When a banker or mortgage broker pre-approve you for a mortgage, they’re going to go fairly high. Higher than what most people can actually afford. It’s important to know what number you’re actually comfortable with financially, instead of just trying to find a place that reaches the top end of what you’re pre-approved for.
Me: Very good point. So after you get pre-approved, then the next step would be to find a realtor?
Hiroshi: Yeah, depending on how detail oriented you are, it’s good to sit down with a realtor to let them know exactly what you’re looking for and what you’re expectations are.
For example, how many bedrooms and bathrooms do you need, do you want a yard, are you okay with a driveway or do you need a garage, are you looking for something open concept? And what’s the most important thing to you. Having a big kitchen? Do you need lots of closet space?
Me: After that initial consultation, do you find most people’s wish lists change after their first or second rounds of house hunting?
Hiroshi: If the buyers really know what they want, it’s easier for a realtor to match what they are looking for. If they aren’t really sure what they want, then what I usually do is show them a variety of different homes to help narrow that down for them.
Me: Once the house hunting part starts, typically how many homes will buyers see before purchasing a home or making their first offer?
Hiroshi: For first time buyers, typically they’ll see about 10 to 15 homes before either putting in an offer or successfully buying a place. Then again, it’s different for everybody. For a resale buyer (a buyer who is selling their home and buying another one), they’ll see about 8 to 12 homes. But I’ve also dealt with buyers who have seen up to 20 to 25 homes before making a decision.
Me: I know the Toronto real estate market is very different than the Vancouver real estate market, but in my experience so far, if we see a house that checks all of our boxes, we’re encouraged to put in a bid immediately. Is that similar to how things are in Vancouver?
Hiroshi: Since we can see the number of days a home is on the market for, if a place has been sitting there for a while, there’s definitely less pressure on the buyers to put in a bid. But if it’s opening weekend, and there’s a well-received open house, you definitely want to be one of the first people to put in an offer.
Me: So moving onto home inspections, because the Toronto real estate market is so aggressive, you basically can’t make an offer with the contingency of a home inspection. That means, whenever you want to put in an offer on a house, you have to get a home inspection beforehand.
That can get pretty pricey, so I know a lot of buyers are either not getting home inspections at all or are just going by the seller’s pre-inspection report. What is your recommendation for buyers when it comes to home inspections?
Hiroshi: For every house get your own inspection. Even with a newly built house, you just never know how it was built or who built it, so it’s always better to pay for your own home inspection so you know exactly what you’re in for.
I think as a seller it is also good to have an inspection you can share with potential buyers too. As a buyer, would I suggest you trust the seller’s inspection 100%? No. No matter what, it’s always best to get a second opinion.
Me: Is there anything you could suggest for house hunters to be prepared for when they’re going in for their first inspection? Anything they should know to look out for alongside their inspector?
Hiroshi: When doing a home inspection, you’re not looking for small fixes – although it’s nice to know. The primary focus is to see if there are any fundamental issues with the home and what you can expect in the foreseeable future for necessary renovations.
Some inspectors will provide a home owners guide for you which tells you what needs to be serviced while owning the home, like a user’s manual for your house.
Me: What seems even riskier to me is buying a place that doesn’t even exist yet. What are your thoughts on buying a pre-construction house or condo?
Hiroshi: Well, I’ve sold pre-constructions many times. I guess the risk would really depend on the builder. You need to get a good feel for the builder’s reputation and what they’ve built in the past. And in B.C., every pre-construction comes with a home warranty. That’s required by law.
It’s called a 2-5-10 warranty, so for a house the warranty is 10 years on structure, 5 years on the building envelope, and 2 years on the workmanship in the house, like if your drywall cracks or something like that. It’s different for condos though, so definitely go over all the warranty details with your realtor before putting in an offer.
Another important thing to do is say you put in an offer on a pre-construction, you have 7 days to rescind your offer. So, in that 7-day period I’d suggest taking the contract papers to your realtor or a lawyer to look over all the details.
Also, never go into a sales centre and just buy a place based on the model or what the sales people tell you about it. Go in there with your realtor so they know all the important questions to ask and to prevent you from getting talked into buying something you don’t have all the info for.
Me: Well, thanks so much for answering my questions today Hiroshi. Any if anyone else, I guess anyone who lives in B.C., has any other questions to ask you, how can they reach you?
You May Also Want to Check Out:
- How I Dodged a Bullet by Not Buying a House in Toronto
- Did I Just Lose the Last Affordable House in Toronto?
- Letting Go of the Homeowner Dream for Now
- Beware of the Buyer Representation Agreement When Shopping for a House
- Another Week, Another Round of House Hunting in Toronto
- Buying a House is Emotional, Time-Consuming and Goddamn Expensive
- My First Bidding War: But Not My Last
- House Hunting Checklist: My Must-Dos When Checking Out a House
- House Hunting in Toronto: My Experience in a Seller’s Market
- Let the House Hunting Begin