By Ron Rossini – REM Online
There are lots of people out there who want to find a small acreage plot so they can build their dream house in the country. This may not be such an easy task and may be fraught with a lot of barriers on the way to The Great Canadian Dream.
Most counties have regulations on minimum subdividing of land. Before we had planning committees, there were many properties sliced up with homes far apart and far from services. Municipalities were saddled with high costs to service these properties. Most counties now suggest the minimum severance be at least 50 acres, so most current small acreage properties are those with permission granted many years before the advent of planning commissions.
Zoning: One must investigate the permitted land uses for the property. Will it permit a buyer to have uses other than residential or agricultural? Are there any existing development permits on the property or mandatory building schemes? Are there any bylaw restrictions that may govern the specific property, such as rights of ways and road allowances?
Assessing the lot: Is the property suitable for building? Core samples should be taken to determine whether the property can support a foundation without adding expensive truckloads of fill. Has the seller done any soil testing? Core sampling costs a bit of money and would normally be at the buyers’ expense. Will any offer contain conditions on acceptable core sampling?
Are there any buildings on the property? Significant out buildings or other residential structures may need a permit for removal. Were there any other buildings on the property? What was its former use? Could there be any abandoned wells or storage tanks on the site? There may be environmental issues such as issues with abandoned fuel storage tanks and polluted wells.
Are there any current oil/gas leases on the property and are they transferable? Most leases include renewable clauses or expiry dates. The presence of these leases may dictate where future buildings are situated.
Exit and egress from the property is determined by the local governing authority and is usually onto the quietest roadway possible. Rarely will access to a major road be permissible unless there are no other alternatives.
Neighbouring properties should be checked out in a five mile radius of the subject land to explore their uses. Hog operations have a right to exist, but your client may not appreciate building a dream home down wind from a hog farm. A check should also be made with the local zoning authority to explore whether there have been any rezoning requests from surrounding properties.
It may not be possible to remove trees on the property without permission from an approving authority. There might also be loggable bush that may increase the property’s present and future value.
Servicing the lot: Should services like gas and water not be at the road, the buyer might be forced to dig wells and use oil, propane or electricity to heat the home. Wells can present certain logistics problems. How deep you must dig depends on the lie of the land. Raised rolling hill properties often necessitate going very deep for water and increasing costs. Lowland wells could be subject to pollution or runoff from surrounding properties.
There may be water and gas lines at the road but it may cost a lot of money to hook up if the property is significantly set back from the road.
The distance of telephone and electrical lines from the future home to the road is also a consideration and can add considerable expense.
Digging and installing a septic bed and tank generally needs the approval of the local health authorities. The system must be a good distance from the well to guard against pollution.
Financing: Financing a lot is not like financing a home because the land is unimproved. Rather than taking a mortgage on the property, the buyer may have to take out a chattel loan or use a line of credit. These are usually at a higher rate of interest than a mortgage. A substantial down payment on the property might be necessary to even secure a chattel mortgage.
The current taxes on the property are for raw unimproved land and will change significantly when reassessed after the site is improved with buildings. Taxes are generally determined by the extent of the improvements and the property designation as rural or residential. It might be prudent to check the tax structure of the local municipality and get a ballpark figure for taxes for the future improvements.
Building costs in the countryside may be higher than in urban areas, because contractors may adjust for mileage. Landowners must apply to a local approving authority for building permits. The buyer will need to take out a builder’s mortgage when constructing in order to pay contractors at various stages of the building process. It’s better to have a reputable builder construct a home so the buyer doesn’t have to hire a job site superintendent to oversee the construction or, worse still, have to do it themselves. (Tell your client to see the movie Mr. Blandings Builds His Dream House before starting this venture.)
Adverse possession: Have the deed or survey checked to see whether any of the subject land is being used by adjoining neighbours who could claim parts of the property for themselves in a form of “squatter’s rights”
Riparian rights come into effect if buying a property that borders on a public body of water. Land dimensions may extend into water space or, conversely, the land that borders the water may not be solely owned by the homeowner and be able to be enjoyed by the public in general. Shoreline properties have their own peculiarities, such as access to property including leased or deeded water access.
Maintaining the property: The property must be maintained when left vacant and vegetation must be cut regularly. Failure to do so would put the owner on a collision course with the noxious weed control bylaws, forcing the local municipality to cut weeds and send the owner the bill.
Lifestyle: Have the buyers considered the alteration to their lifestyle that moving to a remote countryside area might bring? There are many advantages to moving to a sizeable plot of land including privacy, less noise and light pollution and the opportunity to have a sizeable property to develop. However, there can also be concerns for the previous urbanite who makes that break for the country. He might have adjust to a longer drive to work, travel roads that are far down the list to be serviced or ploughed in bad weather, and experience greater effects from inclement weather because the property may be more exposed and out in the open. Rural properties, due to aboveground power lines, are quicker than their urban cousins to lose power during heavy windstorms and also usually the last to have it restored. Generators are a staple item in a country home to keep the sump pump and furnace working.
Children must also be considered when moving to a remote area, as school availability, bus travel and time spent going to school, social and athletic events must be explored. Proximity to shopping, medical, dental and social venues may also be a homeowner consideration.
Building a dream home and moving into the country may be a tremendously rewarding and worthwhile experience but much thought must also be considered before your client undertakes The Great Canadian Dream.
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Contact the Jeffrey Team for more information - 416-388-1960
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