Real Estate

Our trained lawyers will assist you in the following areas:

Purchase & Sale: Residential

• Negotiating and drafting agreements of purchase and sale
• Acting for buyers or sellers on new home purchases or sales
• Condominium purchases or sales
• Re-sale home purchases or sales
• Acting for borrowers or lenders on mortgage transactions
• Advising borrowers with respect to mortgage liability

Purchase & Sale: Commercial and Industrial Real Estate

• Purchases and sales of commercial real estate including apartment and office buildings
• Land purchases or sales
• Acting for borrowers or lenders on mortgage transactions
• Advising borrowers with respect to mortgage liability

Purchase & Sale: Condominiums

• Negotiating and drafting agreements of purchase and sale
• Acting for buyers or sellers on condominium purchases or sales
• Acting for borrowers or lenders on mortgage transactions
• Advising borrowers with respect to mortgage liability
• Reviewing and advising on Condominium Status Certificates

Leasing of Residential, Retail, Office or Industrial Space

• Negotiating and drafting of commercial, retail, and office leases
• Reviewing commercial leases and advising tenants with respect to lease liability
• Advising landlords with respect to lease enforcement

Severances

• Completing application
• Representation at Land Division Committee
• Dealing with unfavourable reports
• Coordinating survey
• Completing the registration of the severed lot

Minor Variances & Re-Zoning

• Completing application
• Attending on hearing to make appropriate representations, with witnesses, if necessary.

Buying or Selling Real Estate
General introduction
What is the "offer"(the Agreement of Purchase and Sale)?
When do I need a lawyer?
What is discussed in the initial consultation?
What if the deal falls through?
How much are the legal fees?
What are "disbursements"?
How much is the Ontario Land Transfer Tax?
What are "adjustments"?
Are there any other costs?


General introduction

This summary is intended to make the real estate process more understandable. If you are a first-time home buyer, there is a waiver of Land Transfer Tax. If you are purchasing a new home from a builder who is registered under the Ontario New Home Warranty Program, you can access the information regarding the warranty program by clicking | here |.

What is the "offer" (The Agreement of Purchase & Sale)?

The terms “Offer” and “Agreement of Purchase and Sale” are essentially the same. The Agreement of Purchase and Sale, once signed by both parties, is a legally binding contract, which determines all aspects of the real estate transaction. It should clearly spell out all terms and should not be signed by either party until fully understood. The pre-printed agreement used by Realtors includes a number of critical clauses, which you should familiarize yourself with before signing.

One of the most important clauses to include relates to the inspection of the property by a qualified professional. A minor expenditure for an inspection report can save you from potentially expensive surprises, and is always recommended. The report is often used to renegotiate the purchase price with the vendor when important deficiencies are highlighted.

For rural property, you would want to have a use permit for the septic system, and a clear water sample suitable for financing purposes.

Is a survey available, and is it up to date?

Serious consideration should always be given to having a survey completed prior to the closing to determine if any defects exist on the parcel which are not apparent from the traditional search of title.

When do I need a lawyer?

Your real estate agent will normally prepare the agreement of purchase and sale.
However, you should feel free to contact us prior to signing it, if you have any questions or concerns. To ensure that you, or your agent, have access to legal advice regarding an offer, it is our policy to make every effort to be available to provide such advice. Where multiple assets are being acquired, especially with a business or a farm, make sure that the purchase price is allocated among the various assets being acquired – land; equipment; inventory; building; principal residence.

What is discussed in the initial consultation?

In our initial consultation, we will carefully review the agreement of purchase and sale to make sure that your interests are fully protected. Thereafter, we will then provide you with a written estimate of all closing costs, taking into account any adjustments, legal fees, transfer taxes and disbursements. This will enable you to plan for the closing.

What if the deal falls through?

Legal fees will depend on the time invested by the lawyer, and what preliminary searches have been done up to that time.

How much are the legal fees?

Our fees are based on the complexity as well as the time expended on a transaction. After reviewing the offer, we will provide you with an estimate showing a projected range of fees. If the transaction proves to be straightforward, our fees will be at, or close to, the figure quoted. When the transaction turns out to be more complicated than expected, we will advise you accordingly.

| Guidelines for Real Estate Fees |

What are "disbursements"?

Disbursements are expenditures made by us on your behalf in completing the transaction. You will be required to reimburse us for these expenditures, which are in addition to our legal fees. On a purchase, these would cover such items as tax and zoning certificates, LSUC transaction fee, GST (or Harmonized Sales Tax), Sheriff’s certificates, travelling costs, postage, photocopies, land transfer tax and registration fees.

How much is the Ontario Land Transfer Tax?

Land transfer tax is payable by the BUYER upon the registration of the deed. The amount of tax due is based on the purchase price. It is calculated as follows:

0.5% on the first $55,000.00
1.0% from $55,000.00 to $250,000.00 (i.e. - the next $195,000.00)
1.5% from $250,000.00 to $400,000.00 (i.e. - the next $150,000.00)
2.5% on any amount over $400,000.00

For example, the land transfer tax on a $125,000.00 purchase is $975.00 ($275.00 on the first $55,000.00 and $700.00 on the remaining balance of the purchase price).

| Calculate Land Transfer Tax |

What are "adjustments"?

The typical offer states that the buyer is required to pay “the balance due on closing, subject to the usual adjustments.” On a residential purchase, you would expect to see an adjustment for municipal realty taxes, water rates, local improvements (sewer and water debentures) and oil, if applicable. The realty tax adjustments could favour the buyer or the seller, depending on both the timing of the closing, as well as the status of the payments of the taxes by the seller. If the house is oil-heated, the buyer should expect to pay for a full tank of oil on closing.

Are there any other costs?

If a mortgage is being arranged, there may be additional costs, such as broker and finders fees, administrative, appraisal and outside counsel fees. Depending on whether there is a guarantor or not, independent legal advice may also be required. Also, most lenders will require a building location survey.

If a current location survey is not available, then the buyer will be required to obtain one. A location survey for a residential lot can cost in the range of $1,000.00 to $1,500.00, depending on the size of the property and complications which the surveyor runs into.

Title insurance is also available and can reduce costs in some situations, while still satisfying your lender's requirements. Title insurance costs start at $324.00 and increase depending on whether it is a farm, a commercial building or an apartment. With title insurance, disbursements may be lower, as a result of not being required to do certain off title searches. Most real estate transactions are title insured given the additional coverage it provides, including fraud and identity theft.

Title Insurance
Nature of title insurance
Considerations when choosing title insurance
Situations where time is a factor
Is there still a need for an up-to-date survey?
Information for first-time home buyers
RRSP program


Nature of title insurance

Title insurance is essentially an insurance policy issued by an insurance company to provide compensation in the event that there are title defects which affect your home that are discovered after the deal has closed.

Considerations when choosing title insurance

In the usual transaction, your lawyer searches title to your property and also performs a number of other searches such as zoning, work orders and tax arrears to ensure that the property you are purchasing can be legally occupied and that there are no tax arrears or other liens against the property. This will include a review of any survey available to ensure that there are no encroachments affecting the property as well as a search of executions against the vendors. In some instances, where the Registry system is still applicable, we would check executions against predecessors in title. An execution is a writ of seizure and sale of property placed by a creditor who has obtained a court judgment against a property owner. Executions must be paid off in order to pass clear title onto a purchaser, otherwise your title will be subject to such an encumbrance.

In a title insured transaction, some of these searches can be avoided and even a survey can be omitted. Instead, a policy of insurance is issued to the purchasers and their mortgage lender where financing has been involved. Unlike a lawyer's searches, a title insurance policy does not ensure that clear title passes to the purchaser, but instead it provides for compensation to be paid in the event that a cloud on title is later discovered. The purchasers can use title insurance to avoid the cost of having a new survey prepared. In recent years, municipalities have substantially increased the costs of zoning, subdivision compliance and tax searches, not to mention the turn around time to answer such requisitions, making title insurance an increasingly popular option in some transactions.

Some of the popular title insurance companies we deal with are:
| Stewart Title Guaranty Company | First Canadian Title | Law PRO |

Situations where time is a factor

When either party wishes to close a transaction quickly, a policy of title insurance is often the most viable option. By eliminating many of the searches otherwise required, a policy of title insurance can facilitate closings on very short notice. Where there is a specific title problem, discussions can be held with a title insurance underwriter to see if a specific rider can be put into place to address a Mortgagees concerns.

Is there still a need for an up-to-date survey?

This depends upon what the parties want.

A survey will set out the extent/limits of one's ownership. If there is a gap in the title which has not been identified by the Land Title System, then one reliable way to find the gap would be through a proper survey, which highlights certain items like unregistered easements; rights of way; adverse possession of additional lands; overlap of lands; encroachments; side yard setbacks; potential violations of lot coverage maximums; dimension discrepancies; misdescriptions - identifying where the lands are actually situated as opposed to where the deeds say they are located; unregistered road widenings; natural severances; etc. Likewise, the Land Titles Act does provide for some warranties of title, but these are limited in nature.

In urban and rural areas alike, a survey is an invaluable tool in determining the extent of what you own.

Information for first-time home buyers

First time home buyers are eligible for a waiver of their Land Transfer Tax up to $2,000. There are limitations to qualifying, which are explained in detail on the web-site of the | Ontario Ministry of Revenue |.

RRSP program

If you are a first time buyer, and have assets invested in an RRSP, you can withdraw up to $20,000 to apply towards the purchase of a home. You are considered a first time home buyer if you have not lived in a home owned by yourself or your spouse in the last five years.

In addition to being a first time home buyer, you must have entered into a written agreement to buy or build a home and intend to occupy that home as your principal residence. Any funds you wish to withdraw under the program must have been in your RRSP for at least 90 days. Once you have applied the RRSP funds to the purchase of your home, you are required to pay back the RRSP over 15 years. Ordinarily, you will deposit 1/15 of the amount withdrawn back into your RRSP in each of the 15 years following your home purchase. If you fail to repay an amount required in any given year, then that amount will be included in your taxable income for the year.

PLEASE NOTE: This information is based on Ontario law and is general in nature. It is not meant as legal advice and does not create a solicitor/client relationship between the firm and the reader. Specific facts in any given case may alter their application, or otherwise involve other laws not referred to here.


Contact Us

info@levesquegrenkielaw.ca

233 Augustus Street
Cornwall, Ontario
K6J 3W2

Tel: 613.932.7654
Fax: 613.938.1692

Hours of Operation

Monday - Friday
9:00 A.M. - 5:00 P.M.