Tag Archive for real estate lawyer

Laurin Jeffrey | April 16, 2011
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Splitting your lot

A mortgage provider may demand a new appraisal

By Helen Morris, National Post

If you moved into your neighbourhood a number of years ago, perhaps when new houses were still being built, you may have bought a double lot. Maybe the idea was eventually to build a second home.

However, if you have decided to split your double lot and sell off the vacant half, there are mortgage, planning and property tax issues to consider, which can be lengthy and costly.

“It’s one of those areas that can be very tricky,” says Ray Leclair, real estate lawyer and vice-president, Title Plus at Law Pro in Toronto. To sever a lot, you will need to know if, legally, it is a double or two single lots, get permission from the City, as well as get your mortgage provider to agree to your newly reduced property size.

“It would affect the total value of their asset that you’ve got the mortgage on,” says Al Roberts, a broker with Mortgage Intelligence in Unionville. “If they sever the double lot, then you may have to proportionally reduce the mortgage to the new value of the reduced amount of land.”

The lender may require you to pay the mortgage down by “x” amount of dollars before allowing you to sell part of the asset. A mortgage provider may also demand a new appraisal.

Unlike when you sell a home, you will need to get permission from the municipality to split a lot.

“A person can make an application to the committee of adjustment and ask that a piece of land be severed,” says Joe D’Abramo, acting director zoning and environmental planning, City of Toronto. “We would look at the pattern of lot development in that area. This is a fundamental part of city development, the nature of lot size and creation.”

Each neighbourhood has its own style and feel, and part of this is down to the size of the lots.

“People view and value their neighbourhood by the width of the lot,” says Mr. D’Abramo.

Mr. Leclair says approaching your neighbours ahead of time can often defuse potential conflicts over a severance or planning application.

“People within 200 feet of the application site will receive written notice. The community comes out to the committee meeting and they’ll voice their opinion and it can get very heated at times,” Mr. Leclair says. “I’ve seen situations where it’s neighbour against neighbour down at the committee.”

The planners want to ensure that each lot and home fits with the overall character of the neighbourhood. The city must also consider provision of services to the new lot and the committee tends to grant the size of lot that is compatible or comparable to the pattern of lots in that area.

“Even if you have severed the land, the zoning still remains, so whatever the zoning says in terms of use permission will then apply to that new lot,” Mr. D’Abramo says. “It’s likely that if you created the new lot through the committee of adjustment, and it is of an appropriate size, that the zoning would allow for the construction of a home.” The new owner would need a building permit and must meet the regulations of the zoning to build a home.

Once the severance and sale of land has been registered with the land registry office, it is time for your property taxes to be reassessed.

“MPAC adjusts the site areas and current values of the affected parcels in accordance [with the] information provided by the land registry office,” says Joe Regina, account manager, Municipal Property Assessment Corp. in Toronto. “[Every four years], MPAC analyzes all registered real estate sales transactions and associated property-specific information in a community to determine current value.”

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Contact the Jeffrey Team for more information  -  416-388-1960

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Category: Ajax Real Estate, Detached Homes, Legal Real Estate Issues, Miscellaneous, Pickering Real Estate, Selling Real Estate | Tags: , , , , , , , , , , , , , , , , , , , , ,
Laurin Jeffrey | October 25, 2010
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Renovating without a permit a costly mistake

Chaya Cooperberg – Globe and Mail

My husband and I dream of the day we can finish our basement. We would love to have the extra space to accommodate guests and for our kids to play. I fantasize about closets and storage space lining the walls for all of the kids’ toys and clothes. I always assumed that when we have the funds for the project it would be a simple matter of finding the right contractor to get the job done quickly. But there is an important part of taking on a home renovation that I had not considered — the building permit.

Of my many friends who have had their basements finished over the past few years, none have obtained a building permit first. They assumed that since the renovation did not extend beyond the existing walls of their home, they were free to make any changes they wished.

According to Ray Leclair, a real estate lawyer and vice-president of the TitlePLUS program at Lawyers’ Professional Indemnity Company (LawPRO), my friends have been breaking the law.

“It’s a municipal by-law under building code,” he says. “The impact of it is that there could be a fine for the homeowner or the municipality can say remove the structure or they’ll condemn the property.”

Most of us realize that major renovations such as building an addition to a home require a building permit. But I was surprised to learn that many smaller jobs may require one as well. These jobs include finishing basements, updating plumbing or electrical equipment, constructing a deck, or even adding a wood burning stove. If you are making changes to partitions or load-bearing walls or changing the structure of doors or windows, you may need to apply for a permit as this kind of work could affect the structural integrity of your home.

Mr. Leclair has seen several situations in which new home owners discover too late that the structure of a newly renovated house is not sound or that the electrical system has not been done to code and is creating a fire hazard.

“A dream home purchase can turn into a nightmare if you do not acquire the proper permits or if renovations were done by a previous owner without a permit. The municipality may force you to remove walls, ceilings, cabinets and other finishes so that an inspector can determine if the work complies with the building requirements or, in the worst case, remove the improvement entirely.”

Mr. Leclair acknowledges that there is a hassle involved in getting a building permit. You will need to provide the municipality with detailed plans of the renovation to the house and provide any additional documentation requested. An inspector will be engaged during the project to ensure that the work complies with building codes and regulations.

However, without a permit, you do risk the sale of your home in the future. Buyers could request that a permit be obtained for the work already done or ask for a price reduction because of the cost risk it presents to them. Without a permit for your renovation, a mortgage refinancing application may even be affected, Mr. Leclair warns.

Given that home renovations are more popular than ever, it pays to do them properly. Recent statistics released by the Canadian Mortgage and Housing Corporation revealed that 45% of households intend to do some form of maintenance and repairs, while 78% will undertake alterations and improvements. Sixty-eight% of the home owners who intend to renovate this year will do so to update, add value or prepare to sell their home. None of us want to invest in a pricey update of our homes only to see it cost us more later.

If you are undertaking a renovation, check out your local municipality’s website for building permit information. You can also find a real estate lawyer to help you through the process at titleplus.ca.

If you are looking to buy a home that has had recent renovations, check with the city to see if a building permit was issued and that the structure was inspected and compliant. You can make your offer conditional on the availability of the permit.

“There’s no reason for this to kill a real estate deal,” Mr. Leclair says, “but it gives you the opportunity to walk away. Once you know there are potential problems, you can ask them for a reduction in the purchase price or let the vendor get the permit and satisfy the inspection.”

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Contact the Jeffrey Team for more information  -  416-388-1960

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Category: Ajax Real Estate, General Real Estate, Miscellaneous, Pickering Real Estate, Renovation and Maintenance | Tags: , , , , , , , , , , , , , , , , , ,
Laurin Jeffrey | September 14, 2010
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Inspect your home inspector

Having a detailed home inspection should give you some idea of what really lurks beneath the surface beauty of that dream home

By Helen Morris, National Post

“The function of the home inspector is to identify what we call ‘major defects’,” says Trevor Welby-Solomon, vice president, technical training, support and development at home inspection company Pillar to Post. “What we’re looking for are things that affect health and safety or something that could have a significant impact on the livability or the affordability of the home.”

Mr. Welby-Solomon says his company’s inspectors undergo a rigorous training and mentoring process before they are let loose on the public. However, in Ontario the home inspection industry is not regulated.

“Real estate is buyer beware. Home inspections is still in the Wild West,” says Ray Leclair, real estate lawyer and vice president, TitlePLUS at LawPRO. “There is no legally recognized designation of home inspector. There is nobody that sanctions home inspectors and so anybody can call themselves a home inspector. There are some very good ones. There are some that are not.”

To make sure you get a good inspector, start looking for one well before you need him.

“The difficulty is that most buyers leave it to the last minute and so this means that being able to do the research is tougher,” says Aubrey Le-Blanc, chief operating officer, Ontario Association of Home Inspectors. “As with a lawyer, you want to know a home inspector in advance. You want references…the best test is [to ask] ‘Who did you use and did you have any surprises after?’”

Mr. LeBlanc also suggests asking your real estate agent for recommendations.

In the absence of personal recommendations, the Ontario Association of Home Inspectors does provide a list of inspectors who will carry out an inspection according to the association’s standards of practice.

“We have standards of practice that are on our website [oahi. com]. It forms part of everybody’s contract, what will be examined and what won’t be examined,” Mr. LeBlanc says. “The basic principle is, if it can’t be observed, it can’t be assessed.”

Knowing what the inspector will not do can be almost as important as knowing what he will.

“It is a purely visual inspection conducted of the home and its systems, and the only controls we use are the user operator controls,” Mr. Welby-Solomon says. “The home inspector is a general practitioner like your family doctor and is not an expert in any particular field. That is why — same as your doctor would refer you to a specialist–if a home inspector sees something outside the parameters of those standards of practice, they would tend to refer you on to a specialist.”

In many older Toronto homes, Mr. Welby-Solomon says, inspectors must hunt for clues that may suggest ancient wiring or plumbing is lurking beneath.

“In the downtown Toronto area, our biggest problem is the old housing stock that has been remodelled so many times we really don’t know in a typical visual inspection what’s behind those walls,” he says.

If you discover a defect after moving in that wasn’t on the inspection report, any recourse will depend on what your particular report covered. If you’ve lived in the house for some time and see a window leak, you may not be covered.

“The [response to any such complaint] may well be: ‘Well, that was a maintenance issue’,” Mr. Leclair says. “[They may say,] ‘You should have maintained that part of it, you should have recaulked the windows. If you would have done that, they would not have leaked, so I’m not responsible.’”

While 95% of Ontario Association of Home Inspectors members and all Pillar to Post inspectors have liability insurance, Mr. Leclair warns that some inspectors limit their liability to repaying the cost of the inspection.

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Contact the Jeffrey Team for more information  -  416-388-1960

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Category: Ajax Real Estate, Buying Real Estate, First Time Buyers, General Real Estate, Pickering Real Estate | Tags: , , , , , , , ,
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