Robert McLister wrote in the Financial Post last week that Greater Vancouver and the Fraser Valley have logged 946 court-ordered listings through September, close to the 2012 record. Only 38% have sold, against a normal year’s 60%, and they’re taking about 70 days to go versus 23 for an ordinary listing.
I read that from two sides of my desk. Some of my clients want to buy one. A few are quietly worried about becoming one.
If you’re thinking of buying a court-ordered sale
Three things people get wrong.
They aren’t fire sales. A judge has to be satisfied the price is near market, so the headline discounts are rarer than the stories suggest. Year to date these properties are going for roughly 14% under assessed value, and assessed value in Surrey is often already behind the market.
You buy it as-is. No subject to inspection in any meaningful sense, no promise the appliances stay, and you may walk in to find the last owner left in a hurry.
Your financing has to be ready before court day. The lender wants an appraisal on a property you may not be able to fully inspect, and the approval must survive a bidding process where someone can show up and top your offer in the courtroom. Pre-approval is not enough. I want a full approval, and I want the lender to know it’s a court-ordered sale from the first call.
If you’re the one falling behind
This is the part I actually care about. Almost every court-ordered sale started as a missed payment that nobody dealt with.
If you’re behind on a mortgage in Surrey, the window to fix it is before the lender’s lawyer sends the demand letter. In that window we can usually refinance, or place a short private mortgage that pays the arrears and gives you a year to sell on your own terms or get your income back. Once the petition is filed, the lawyers’ fees pile onto the balance and the options shrink every week.
Nobody enjoys that first call. Make it anyway. I’ve had people call me after two missed payments and we had it sorted inside three weeks. I’ve also had people call after the petition, and we still found a way, but it cost them far more.
If you’re in either position, the buyer’s or the borrower’s, reach out and tell me which one. The plan is different, but both start with a conversation.
