BUYING A HOME

By GEORGE L. CRAIG , Real Estate, Wills & Estate Law Department

If you are buying a new home or property the information in this article may be of interest. Many of our clients have questions relating to one or more of the issues dealt with below.
If you have more specific questions, and would like to retain our services, please contact us by calling 721-3377, faxing 721-4025, or emailing gcraig@burgarrowe.com - George Craig, gknight@burgarrowe.com - Graham Knight or aain@burgarrowe.com - Andrew Ain

At the end of this section you will find a list of "Moving Tips" which may be useful to you.

TITLE
A purchaser may hold title with another person as "joint tenants" in which case each will have equal ownership of the property. In the event of death, the survivor automatically inherits the property. If you hold title as "tenants in common" you may each hold title in equal shares (or on some unequal basis) but without right of survivorship. Alternately you may wish to direct only one person to have title.

ENVIRONMENTAL ISSUES
Environmental liability is a concern to all property owners. Contamination of water or soil may result in liability for cleanup even by an innocent purchaser. Past practices, such as indiscriminate disposal of farm pesticides or household chemicals by a previous owner, for example, may create a liability.
To minimize your risk, a detailed Environmental Assessment of the property may be obtained. You should discuss this with your lawyer.

DEVELOPMENT CHARGES ACT
Recent legislation permits Municipalities and/or School Boards to levy substantial charges under the Development Charges Act (DCA). The charges may be levied at various stages of property development or construction. For example, charges may be levied upon the creation of a new lot, on the granting of a minor variance, on a re-zoning or at the time a building permit is issued. If any of the foregoing activities are contemplated we suggest that you discuss them with your lawyer as soon as possible.

MULTIPLE RESIDENTIAL USES
Normally, a municipal zoning by-law, will govern the use permitted in a home. If you are contemplating a multiple residential use or if it already exists in the property being purchased you should ensure that it is legal.
Fire Code regulations under the Fire Marshals Act, affect multiple occupancy buildings. Whether such use exists or is contemplated in your property there will be safety standards to be met, the cost of which may be substantial.

SURVEY
An up-to-date survey, by a qualified Ontario Land Surveyor, is very important in the completion of your purchase. We recommend that purchasers obtain a survey. Most mortgagees require one. In the absence of an up-to-date survey your title opinion will be subject to any discrepancies which a survey might illustrate, such as building setbacks, encroachments, easements, or variances in the legal description.

ONTARIO HOME OWNERSHIP SAVINGS PLAN
If you and your spouse are a first-time homebuyer, and a resident of Ontario, a contribution to an Ontario Home Ownership Savings Plan (OHOSP) may permit you a partial reduction of your provincial Income Tax at year end. Prior to January 1, 1994 acquiring an OHOSP also permitted, in certain circumstances, a Land Transfer Tax rebate. This rebate is no longer available unless you acquired your OHOSP plan prior to 1994.

SEPTIC SYSTEMS
Many "country" properties are serviced by a septic system rather than a municipal sewer system. If your new property is serviced by a septic system and you are not familiar with the use of such system, you should inform yourself regarding them. It is important that they be properly maintained and, if necessary, pumped out on a regular basis.
The Ministry of Environment requires septic systems to be designed for the use intended. This usually requires a holding tank and tile bed of adequate size. Proper installation of the system is usually verified with the production of a "use permit" from the County Health Unit.

If a septic system was properly installed but an addition to the home has subsequently been made, or if the use of the property has been increased or is intended to increase, the system may be inadequate.

Vacant Property: If you have plans to build on the property you should determine if the local Health Unit or Ministry of Environment approval is available for the necessary septic system.

RENTAL RESIDENTIAL PROPERTIES
If you are considering a residential rental property, you should be aware that there is much legislation affecting the rental of residential property. The following four Acts affect the rights of a Landlord:

• Landlord Tenant Act, R.S.O. 1990, c.L.7
• Rent Control Act, 1992, S.O. 1992, c.11
• Rental Housing Protection Act, R.S.O. 1990, c.R.24
• Residents' Rights Act, 1994, S.O. 1994, c.2

It is very difficult to determine the lawful maximum rents for any particular building. As a result only a qualified opinion as to the lawfulness of the rents for the property can normally be given. Because the value of the building is usually a multiple of the rents paid this is significant. You should review this issue with your lawyer before making an offer on a rental property.

CONDOMINIUM PURCHASE
If you are purchasing a new Condominium Unit, your Agreement of Purchase and Sale may provide for an "Interim Closing". This means that during the period of time between when the unit is ready for occupancy and when the unit is officially registered as part of a "Condominium Corporation", you will be given use of but not the ownership, of the unit. For this use of the unit, you are charged an Interim Occupancy charge. Please note, that if a mortgage is part of your purchase, it can not be registered at the time of your interim closing and will be delayed until final closing. The scope of this report does not allow for a detailed discussion of condominium ownership. We will be pleased to discuss the issues relating to your new condominium.

MAIL SERVICE
Many new homes have mail service which is provided through "Super Mail Boxes". You should make arrangements directly with the post office to ensure mail delivery once your purchase has been completed.

Also review our list of "Moving Tips" which may be useful to you.

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The above is not intended to constitute legal advice. Please contact a lawyer to clarify your legal rights.