Barristers & Soliciotors / Avocats et Notaires
Since 1994 / Depuis 1994
In the Market for a House? Read this First
The real estate market in the GTA is, in a word, HOT! With interest rates remaining low, more and more people are looking to own their own home.
According to the Toronto Real Estate Board, the average selling price of a home in the GTA is just over $600,000. Despite this hefty price tag, too many homebuyers treat buying a house like buying a fridge or a mattress or a car, even though this is likely to be the biggest purchase they will ever make.
Although many house sales go off without a hitch, the purchase of real estate can be fraught with hurdles and even a few hidden dangers. However, with the help of an experienced real estate lawyer your purchase should go smoothly.
The first thing you should do if you are thinking of buying your first house or your third house is to contact your lawyer. In a misguided attempt to save money, many people only bring their lawyer into the picture once an agreement of purchase and sale has been signed. In fact, talking to your lawyer early on may save you time, risk and money. Your lawyer will ensure that the purchase is done right and that all of your legal rights and protections are respected.
Having your lawyer review the agreement of purchase and sale before you sign it, at which point it becomes a binding contract, can be very helpful. He or she will ensure that the wording benefits you, the purchaser. For instance, instead of indicating that “the offer is conditional on financing” your lawyer may suggest something more accurate such as “the offer being conditional on the buyer getting financing satisfactory to the buyer.”
If you are looking at purchasing a home or condo that has not yet been built, it becomes even more important to bring a lawyer into the process. The purchase agreements in these situations can often be quite lengthy, running as much as 50 pages. This is not the time to just click “accept”. In addition, builders often offer incentives to make the purchase more attractive. However, those incentives may look quite a bit different in the agreement than they did on the sales material. The purchase price may also look quite different once all the extra charges have been added. Your lawyer will have good advice for protecting your rights.
Your real estate lawyer will also provide advice and services with respect to the following:
Good Title
Although you are buying the physical land and house, neither are worth much if you don’t have good title to them. Good title means that the house or property you have purchased is really yours and that no one else has a claim to it that you do not know about. Good title also means that your property is correctly described in all official documents and that those documents are properly registered.
Title Insurance
Title insurance offers home buyers another way of guaranteeing good title. If there are any problems after closing, the buyer will be covered for losses up to the amount of the policy.
Paperwork
There is lots of paperwork involved in the purchase of a house, including the deed, the proper description of the land, the mortgages, the affidavits of residence and the affidavits for the land transfer tax. It is important that all the documents are filled out correctly and that they are registered in a timely fashion and in the correct order.
With respect to the legal fees, you should know that purchasers will generally pay more than the vendor since most of the legal work is done by the former’s lawyer. You should also know that the fees can vary depending on whether you are buying a condo or house, a new construction or resale since the amount and type of work can be quite different.