Buying Property in Canada
What to consider and recommendations
The bottom line is that buying property in Canada is extremely easy. But there are a few rules and guidelines that must be taken into consideration and followed closely to avoid complication.
From the residency perspective, if you are not a Canadian Citizen and if you plan to stay in Canada for 6 months or less annually, the federal government considers you a non-resident, meaning that you are able to still open a bank account and buy property, etc. If you plan to live in Canada for over 6 months per year, you should apply for immigrant status or have a valid Canadian Passport.
It is important to notice, however, that while nearly all Provinces (British Columbia, Ontario, Quebec, Nova Scotia, Newfoundland, New Brunswick) don’t have any restrictions on foreign ownership of property in Canada, some do limit the quantity of property/land a non-resident can purchase. On Prince Edward Island, non-resident buyers must apply to the Island Regulatory and Appeals Commission for land over 5 acres in dimensions, or land with a shore frontage more than 165 feet. In Manitoba, non-residents are prevented from owning farmland unless they actually plan to maneuver there within 2 years. Non-residents might not own land over 10 acres in dimensions in Saskatchewan, whilst in Alberta they could only own up to 2 plots of land not exceeding 20 acres in total.
Once you have chosen a REALTOR®, secured your mortgage and found your property, you create an offer and once it is created and once accepted, a deposit is made payable. When buying a home in Canada, an offer must be produced and submitted in writing so that all areas of the transaction are clearly outlined within the offer. Once you (the buyer) have signed the document, it becomes legally binding. If you withdraw from the offer as of this stage, you may lose your deposit and are often sued. Ensure that every item remaining in the property, i.e. carpets, fixtures and appliances, is written on the offer as ‘chattels included ‘. Your licenced REALTOR® should also insert two clauses stating that the offer will only proceed at the mercy of building inspection and that you as the customer can meet your financial obligations. Once your offer is complete, it is going to be presented to owner and negotiations is going to be made. This might include changes in price, completion date and chattels. The changes are initialed by owner and returned for you (the buyer) for the initials. The resulting Agreement of Purchase and Sale will state the price and the deposit. The deposit is positioned in a trust account and is credited towards the price when the offer has been accepted by both owner and the customer and the transaction is complete.
Most REALTORS® are self-employed and work on negotiable rather than fixed commission (payable by the seller). A purchaser can find property using any REALTOR®, regardless of whether that REALTOR® originally listed the property. You will find usually 2 REALTORS® involved with a sale – the seller’s agent and the buyer’s agent. The commission received upon the sale of the property is divided involving the 2 REALTORS® ;.Some agents may also be dual agents as seller agent and buyer agent but must declare this to buyers and sellers alike.
Contributed by: Greg Clarke Royal Lepage Kelowna Realtor foremost real estate expert Phone 250.869.9119