Sunday, 2 November 2014

Big Buys

A friend of mine bought a home yesterday, a fabulous apartment in one of the nicer areas of Calgary, a neighbourhood called Connaught. His building is a couple of blocks off of Calgary's "Red Mile", a strip of 17th Avenue lined with trendy bars and interesting restaurants, all filled most Friday and Saturday nights. The nice thing is that he is a couple of blocks away, close enough to walk but far enough that he doesn't have to deal with the congestion and noise.

It's interesting, the process of purchasing a home, how different it is today from 30 years ago. The amount of disclosure involved, the inspections, the analysis of neighbourhood data. When I bought my first home, there was none of this. It was truly "caveat emptor". When we bought what would ultimately become our family home, the homeowner was not required to disclose the aluminum wiring or the crack in the chimney flue. Since there was no home inspection back then, we had to take our chances and go with what we knew.

These days there are far more protections in the home buying process, yet even still it can be fraught with difficulty. I have always wondered why the two largest purchases most of us are likely to ever make, a home and a car, are purchases with so little regulation. Sometimes I think there are more consumer laws governing the sale of a $1.99 children's toy than there are governing the sale of a $25,000 car. Of course all of these protections go out the window when purchasing a home or a car on the secondary market.

This is why I have two simple rules for both of these purchases. For a car, go through a dealer; it gives you someone to sue if something should go wrong. For a home, go through a licensed and bonded real estate agent; it gives you someone to sue if something should go wrong. It's not that I am a litigious person; it's that the people or agencies have a lot more skin in the game if something should go wrong. They are there, and have to be there, mostly, after the deal is done. While not well monitored, their business practices can be challenged if necessary.

In the past, knowledge was power in these transactions. Most people didn't know a lot about cars, or about houses. Many of us knew about land, but not the complex details of construction. Many of us remembered cars from a simpler time, but we don't know a lot about the highly engineered, computer controlled cars of today. Thanks to the internet, that knowledge gap is lessened. But there is still a gap, especially in the area of buying a vehicle.

These are big purchases, complicated purchases. Even today there is a degree of special knowledge needed in making them. Yet these are the things we all wish for; a home and a car. Or at least most of us; I wanted a truck.

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