Purchasing a Pre-Construction Condominium – What to Know

What to Know

Interested in entering the pre-construction condo market but not sure where to start? You are certainly not alone! The idea can seem a bit daunting at first. Hundreds of pages of legalese to go through. Uncertain construction timelines to deal with. An ever-changing market. There are many factors to consider before putting pen to paper. Here we break down some of the biggest ones to help make that decision just a little bit easier.

The Signing Process

If you are feeling a little bit intimidated by the prospects of signing on the dotted line no one would blame you. Depending on the nature of the project you may have to act very quickly to secure a spot, and you might be a bit worried that somewhere in that abundance of carefully constructed clauses are a few words that may come back to bite you. Thoughts like this are perfectly natural, and thankfully, there are some safeguards in place to help.

Every condominium project in the province of Ontario is subject to the rules of the government-legislated Condominium Act. One of the most important of those rules is the designated 10-day “cooling-off” period that every purchaser of a condominium unit is entitled to.

This 10-day period gives every purchaser a chance to review their contract with their lawyer with an eye out for any pitfalls. Some first-time pre-construction purchasers may be surprised to find that the purchase price of the unit does not make up the totality of the funds that will be needed for closing. Each pre-construction contract comes with an “adjustments” section where the builder may charge additional fees to cover some of their costs.

During the 10-day cooling-off window, you and your lawyer may request certain fees be capped at a maximum amount or deleted from the contract entirely. Additional negotiated terms may be the right to lease during the occupancy period or the right to do an assignment sale to a 3rd party prior to closing. If the builder is agreeable with any of the changes, amendments to the contract will be signed by both parties so that these negotiated terms officially become part of the deal.

It is important to remember that it is the builder’s final decision on what they will or will not agree to. But the 10-day cooling-off period allows you to cancel your agreement and receive any deposits already submitted back in the event that you do not like what you hear.

The Occupancy Period

After the 10-day cooling-off period has expired, if you have not decided to cancel your agreement in the time period allotted then your deal becomes firm. Congratulations! You have now officially committed to purchasing your pre-construction condo.

What happens next you might ask? The answer is mostly a lot of waiting as the condominium physically gets built. During this time, the builder should be providing updates on how construction is progressing, and advise on any delays within the timelines noted in your Tarion Warranty.

Eventually, the builder will advise you and your lawyer that your unit is ready for occupancy. This is one of the most exciting steps in the process as it means it is almost time to get your keys! Just before occupancy, depending on the nature of your contract, you and your lawyer may be asked amongst other things, to get insurance for your unit, provide a mortgage pre-approval, write out a set of post-dated cheques to pay for your monthly occupancy fees, pay your final deposit, and sign the builder’s interim closing documents, amongst other things.

Once all of the required documents and funds have been submitted to the builder’s law firm by your lawyer, your keys will be released for pick-up. You can now officially move into your new unit (or begin to lease the unit with the builder’s permission)! During the occupancy period, which usually lasts on average between 6-12 months, there may be some minor touch-ups that need to be done within your unit. This is very normal and the builder’s representatives will return to fix any issues you or your appointee noted during your pre-delivery inspection. It is also important to submit your list of issues to Tarion during the 30-day window at the beginning of your occupancy period to ensure proper coverage of any deficiencies noted.

The Final Closing

The occupancy period is an exciting time because it is the first chance to get your keys, but you might be wondering, wait, when do I pay off the rest of the purchase price and any adjustments? The answer is at the final closing stage.

During your occupancy period, the builder will often give hints that the final closing may be approaching. You may hear things like “the building is almost registered with the city”, and see things like the completion of the top floor and amenities. Your contract should often state how much notice the builder is required to give prior to assigning a final closing date. Typically, this is between 20-30 days.

Once you have received your final closing date, it is important to notify your lender immediately so that all of the mortgage paperwork may be signed and your lawyer can receive the mortgage instructions. Typically, the mortgage will cover 80% of the purchase price, which is also often the remaining balance left on the purchase price. It is also advisable to start shopping for a lender well in advance to avoid any last-minute complications or a rushed timeline.

Just before the final closing, you will meet once again with your lawyer to sign any final closing documents the builder requires, and also wire any money required from your personal funds for the closing (remember adjustments!). After that, your lawyer will take care of the registration and the transfer of funds on the final closing date. Once everything has been finalized, you are now officially the owner of a brand-new condo!

In Summary

Purchasing a pre-construction condo may not be for everyone, and that is OK! But those who have entered the market will also tell you it can be very rewarding. Whether the goal is to use the property for investment purposes or have a brand-new unit customized just for you, there are many great opportunities pre-construction presents. With a little patience and the guidance of a great team, the property you desire may just be a few steps away.

What is the Foreign Buyer Ban?

Effective January 1, 2023, the Government of Canada is implementing a two (2) year foreign buyer ban. This means that ONLY Canadian citizens/permanent residents will be allowed to buy residential property in Canada. There are some exceptions to the ban. For example, if a non-Canadian is purchasing with their Canadian spouse, or the agreement to purchase was signed prior to January 1, 2023.

Assuming the non-Canadian is allowed to purchase due to an exception, the non-Canadian must still pay a Non-Resident Speculation Tax (NRST).

Non-Resident Speculation Tax (NRST)

The NRST is an additional tax that applies in Ontario to non-Canadian owners only. The tax is expected to reduce the number of properties being purchased by non-Canadians, thereby increasing the housing supply for Canadians.

When the NRST was first introduced in Ontario, it was 15% of the purchase price and applied only to properties within the Greater Golden Horseshoe. Then in early 2022, the NRST was increased to 20% and the scope of applicable properties was broadened to include all of Ontario. Less than 7 months later, the NRST was again increased, to 25%.

The rate of NRST that a foreign buyer pays depends on when the agreement to purchase was signed. Non-Canadian buyers who signed agreements on/after October 25, 2022 will pay an additional 25% of the purchase price; those who signed agreements between March 30, 2022-October 24, 2022 will pay 20%; and those who signed agreements on/before March 29, 2022 will pay 15% only if the property is within the Greater Golden Horseshoe (if not, then there will be no NRST payable).

Exemptions to the NRST – NRST is Not Paid at All

An exemption from the NRST may be available if the non-Canadian is buying a property with their Canadian spouse. In order to qualify for this exemption, both spouses must own the property together, with no other non-Canadians, and all owners must certify that they will occupy the property as their principal residence.

There are two other exemptions, one for those in the Ontario Immigrant Nominee Program, and another for those who have protected person status under the Immigration and Refugee Protection Act (Canada). The criteria to qualify is similar to the spousal exemption.

Rebates of the NRST – NRST is Paid Upfront, but then Apply to Get it Back

In some cases, the NRST must be paid to the Ministry at the time of purchase, but if the non-Canadian becomes a permanent resident within four years, they may apply to get this tax back. In order to qualify for this rebate, the non-Canadian must hold the property alone or with their spouse only, and occupy the property as their principal residence the whole time. The application for the rebate must be made within 90 days of becoming a permanent resident.

The NRST rules have changed a number of times over the last 7 months. As a foreign buyer, it is important to know how much you will potentially pay, and even more important to know whether you qualify for any exemptions or rebates.

If you have any questions about the foreign buyer ban or if you wish to apply for a rebate of the NRST, please contact us at (416) 203-6347 or info@wearelaw.ca for a quote. We invite you to try our easy-to-use Closing Cost Calculator.

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Written by Rishi Sharma, Lawyer at We Are Law.

Why choose the WeAreLaw team?

Whether you are a first time home buyer or an investor we are here for you.

Our Experience

We handle purchases and sales (resale, preconstruction and commercial), refinances, title transfers, assignments and wills and estates. We have been practicing for almost 20 years and have closed over 15,000 real estate transactions throughout Ontario.

Our People

In today’s world, it is increasingly hard to find someone, let alone a company, that cares and is passionate. That’s where WeAreLaw comes in. Our dedicated team wants to ensure that your experience is stress-free from beginning to end while providing you with a swift, accurate and smooth closing. We are in it for the long haul and want to develop a lasting relationship with you.

Let’s be real…when it comes to one of the most valuable assets in your life, you want to be supported by a stellar group of professionals.

Our Fees

Our fees are ALL-INCLUSIVE. What does that really mean? We give you the total costs upfront, with no hidden legal fees popping up on the day of closing. We are straightforward.

Our all-inclusive quote includes your title insurance premium (which is one of the biggest costs in your legal fees). Title insurance protects properties against losses related to the property’s title or ownership and is mandatory in most cases.

Our Convenient Services

Our online cost calculator is available 24/7. You can visit our website at www.WeAreLaw.ca to receive a quote OR feel free to email us at info@wearelaw.ca or call us at 416-203-6347.

We offer easy-to-use remote signing, so you can safely sign your closing documents from anywhere in the world, as long as you have access to the internet (certain conditions apply; i.e. your lender/builder allows remote signing as well).

Our Status Certificate Reviews

If you’re buying a condominium unit, you’re going to need your status certificate reviewed. Our timely and detailed review includes a breakdown of the condominium’s legal and financial health. You will know if there are any existing lawsuits against or by the condominium corporation. You’ll know if your condominium has a healthy budget, if they don’t have a healthy budget then you might potentially be finding yourself paying special assessment fees at some point during your ownership. If you’d like to read more about our status certificate reviews, don’t hesitate to read our blog on that here.

Our Preconstruction/New Construction Agreement Reviews

Bought a new construction unit or home? We offer a comprehensive one-on-one video review with you and one of our lawyers, which includes a detailed cost breakdown (estimate) in one of our famous spreadsheets. There you will learn what you are expected to pay on Interim and Final Closing and also what taxes (land transfer taxes and HST Rebates) you’ll have to pay. We will also advise you of the rebates available to help you get some of this money back.

As an added service, we may make requests to the Builder’s lawyer to further negotiate your closing costs. Often, buyers don’t know their lawyer can make further requests (during the cooling-off period), even if their agent has already negotiated incentives!

Our team has closed thousands of pre-construction and assignment transactions and they have knowledge of most of the major development projects across the GTA. We know what we are talking about.

Our HST Rebate Applications

If you are purchasing a preconstruction property (or have in the past two years), you may be eligible for an HST Rebate. You want to use a team that has experience working with the CRA. We’ve completed over 400 successful HST Rebate Applications for our clients. We know what the CRA’s is looking for in these applications and the criteria for getting the application approved. You only get one shot at filing this application, so you want to ensure you don’t make any mistakes.

If you like what you’re hearing, don’t hesitate to get a quote here; or contact us at 416-203-6374 or info@wearelaw.ca. We are excited to work with you!

What is a Status Certificate?

A Status Certificate is a document that discloses certain information about a specific condominium unit (dwelling, parking, and locker units, as applicable). The Status Certificate includes a package of documents outlining the current financial and legal “health” of the unit(s) and building, and the rules and regulations unit owners must abide by. The package contains important information that should be reviewed by a lawyer before presenting an offer or during the conditional period.

Do I need a Status Certificate?

Yes, for your own due diligence! If you are purchasing a resale condominium unit, you should obtain a Status Certificate for your lawyer’s review. Reviewing the Status Certificate is part of your due diligence. It lets you know if there are any issues that need to be rectified. If a lawyer reviews the Status Certificate before an offer is presented or during the conditional period and finds a red flag, this is the best time to address it. Depending on what is discovered, this gives you the opportunity to amend or rescind your offer.

Yes, for your lender/title insurer’s required due diligence! Your lender (and the title insurer) will want the Status Certificate to be reviewed by your lawyer, and for your lawyer to confirm there are no red flags. The lender will not advance funds for your mortgage, and the title insurer will not insure your transaction, without this.

How much does it Cost? Where do I get one?

Under the Condominium Act, 1998, the cost of a Status Certificate is $100.00 + HST and must be delivered within 10 days. The Status Certificate is ordered through Property Management, who may charge additional fees if you are requesting a rush certificate, based on the timelines their office has for drafting and issuing the document.

Condominium Rules/Lifestyle Restrictions

The condominium documents will also outline any rules or lifestyle restrictions. Some of the more common ones include restrictions surrounding pets, the use of barbeques, and leasing the unit on certain platforms (Airbnb, Vrbo, etc.). Rules often impact lifestyle choices which are typically not legal issues reviewed by a lawyer. If you think a specific rule may apply to you, please let your lawyer know as soon as possible so they can determine if/how it applies to you.

Owned vs. Exclusive Use Spaces

Oftentimes, individuals purchase a parking and/or locker unit with their dwelling unit. There are two types of ownership when it comes to these units: owned and exclusive use.

If the unit is owned, it is a separate piece of land/property from the dwelling unit. The parking/locker unit will be registered in your name on closing, on a separate deed, so it can be sold or leased separately (subject to any Condominium Rules).

If the unit is an exclusive use space, it is not a separate piece of land and will not be registered on a deed in your name on closing. Rather, as the owner of the dwelling unit, you will have an exclusive license/right to use the parking/locker unit. Exclusive use spaces run together with the dwelling unit and cannot be sold or leased separately.

By reviewing the Status Certificate, your lawyer can confirm whether your parking and/or locker unit is owned or exclusive use.

What Red Flags could you find?

Below is a non-exhaustive list of common red flags that may be discovered during our review of a Status Certificate.

Litigation
- Is the Condominium Corporation suing or being sued?
- How can this affect you as the owner?
Arrears in common expenses
- If the unit’s common expenses are not paid up-to-date, the Condominium Corporation can register a lien over the property.
- If a lien is registered on title, it can be enforced and may affect your financing, your right to vote at meetings, etc.
Financial Statements
- Does the Condominium Corporation have an adequate reserve fund?
- Are there greater liabilities than assets?
Special assessments
- Will you be required to pay an amount above and beyond that of the common expenses?
- Has the current owner paid their share of the special assessment in full?
Outdated status certificate
- Should be as close to the current date as possible.
- If dated more than 90 days before your closing date, you will need to obtain a new one.

We would be happy to review the Status Certificate for your next purchase or refinance transaction. Following our review, we will provide you with a comprehensive written report of our findings. Please do not hesitate to contact us at (416) 203-6347 or info@wearelaw.ca if you have any questions. We invite you to try our easy-to-use Closing Cost Calculator. We look forward to working with you!

Written by Ariana Serapiglia, an Articling Student at We Are Law.

The Closing Costs Most Overlooked by Home Buyers

By Zoocasa

When it comes to material possessions, nothing will be more important than your very own home. The price tag on the house you can afford, however, is only the start of costs you’ll be expected to roll out.

To start with the bottom line first, most financial institutions recommend setting aside roughly 1.5 to 2.5 per cent of your purchase price to cover closing costs, such as $6,000 on a $400,000 purchase. While that percentage might give home-seekers momentary pause to which they’ll likely find a solution, the double-digit accrual on a house priced over a million dollars could potentially throw one’s purchasing power out the window. Total closing costs will depend on where you live (in the burbs or rural setting as opposed to the City of Toronto, for example), the type of home you’re buying, and whether the home is a resale or a new construction.

Be prepared:

Closing costs, to be clear, are not ‘hidden’ costs; instead, they are costs for which home-seekers need to prepare. To avoid unpleasant surprises, therefore, put all charges, especially those that are wince-worthy, into a spreadsheet, and either budget accordingly for them or set your sights on a home you can truly afford. This will help you prepare to meet all expenditures means home-ownership success.

Closing costs:

So what are the closing costs? Basically, they include legal and administration fees, home inspection costs, land transfer and property taxes, property/title insurance, moving costs and utility hookups.

Prospective home buyers should also expect to add maintenance and utilities, as well as one-time fees associated with buying a home, such as inspection fees and land transfer costs, to their savings plans. According to a recent TD homeowners’ survey, many former first-time buyers admitted that they hadn’t budgeted beyond the down payment and monthly mortgage payment; if they had, they would have avoided much needless stress and disappointment.

Major closing costs overlooked:

Many sources, including the TD survey, agreed that the most overlooked costs for first-time buyers are:

land transfer taxes
general closing expenses
legal fees

After the mortgage, this taunting trio of expenses is the costliest, and, because it’s often not factored into the budget, causes buyers to scramble for extra cash to close the deal.

Take note that if you’re buying into a new construction, GST/HST/QST applies. A GST rebate might be available, however, for first-time buyers. Ask your lending institution or real estate lawyer for details.

Land transfer taxes will no doubt be the largest upfront expense for homebuyers, which are charged in most jurisdictions across Canada whenever a property is transferred to another owner. In most cases the tax is tiered. One source notes that in Manitoba, for example, you pay zero per cent on the first $30,000; 0.5 per cent on the next $60,000; 1.0 per cent on the next $60,000; 1.5 per cent on the subsequent $50,000; and 2.0 per cent on the remaining value in excess of $200,000. To take the guesswork out of how big a hit you can expect from taxes, depend on handy online calculators to tally your total, depending on your province.

First-time buyers should know that provinces and some municipalities offer rebates that can greatly reduce the amount of land transfer tax you owe. Additionally, an income tax credit is available for qualifying first-time homebuyers in Canada, which can be worth up to $750 in tax relief.

If homeownership is within your grasp, ensure your research is thorough and make sure you know as much as you can about the process and ongoing commitment by adhering to these top three recommendations to aid you in your house-hunting:

Be more thorough when budgeting and accounting for all of costs of home ownership
Make a bigger down payment than 20 per cent if you can
Buy a home sooner, rather than later

Zoocasa.com is a leading real estate resource that combines online search tools and a full-service brokerage to empower Canadians to buy or sell their homes faster, easier and more successfully. Home buyers can browse Toronto real estate listings, to find the perfect Toronto townhouse, condo, or detached home.

How Condo Fees Affect a Condo Purchase

Deciding to buy your own home is an exciting milestone for many, and choosing a condo over a detached home definitely has its perks. The indoor amenities and services, not to mention the outdoor maintenance tasks you’ll never have to do are all wonderful features, perfect for busy singles, couples and seniors.

Although you’re spared a constant outlay of cash towards the upkeep and repair of a detached dwelling, first-time condo buyers sometimes overlook occupancy fees, development charges and closing costs. Without foresight of these expenses, the unwary purchaser could find themselves in a sinking financial boat.
So, besides your hard-earned down payment on the condo of your dreams, ensure you have knowledge of all the costs a condo will entail before deciding you’re ready to sign on the dotted line. Then, go back to the drawing board and ask yourself if you’re truly prepared for the financial impact of all condo fees on your budget.

What are occupancy fees?

They include three fees, identified as:

maintenance fees
property taxes
interest on balance owed (typically 80 per cent, but can vary depending on your deposit structure)

The amount of occupancy fees is roughly equal to the interest on the amount outstanding on the purchase price. For example, a $500,000 condo with 25 per cent down means you must pay monthly occupancy fees roughly equal to interest payments on $375,000.

Put another way, typical condo fees can range anywhere from 60 to 70 cents per square foot, or $485 to $566 per month. The charge goes towards cost of repairs and upkeep of common spaces, amenities and hydro. As the building ages and repairs are required, expect fees to rise.

Condos under construction = development charges

Are you investing in a condo not yet built? Prepare yourself not only for a substantial outlay of closing costs (estimate an additional two to seven per cent of the condo’s purchase price), but also hefty development charges that include:

general levies
education levies,
Section 37 levies
Green Standard levies

Each City issues development charges to a builder when the developer receives their building permit. The developer pays these charges that fund infrastructure, such as roads, libraries, schools, hospitals, parks, transportation amenities, and more. These amenities aren’t free, any more than the pool, fitness room or services that go into establishing your occupancy fee. The difference, however, is that the development charge is a one-time deal.

The problem with development charges is that they are invoiced by the city upon closing, and if you’re in the situation where you’ve signed your contract on a pre-construction condo that won’t be built for two or more years down the road, who can say what those development charges will be?

Fortunately, one money-saving strategy is open to you: Negotiate for capped fees before you sign a purchase of sale agreement. This action will save you tens of thousands of dollars. If a developer is not willing to negotiate, you are advised not to buy.

Additionally, purchasers of units in larger projects might find themselves in an interim occupancy situation (aka phantom rent) for a full year or two—which means paying rent to stay in your unit until developers are ready to register the build. This occupancy fee is estimated between $10,000 and $12,000 before ownership title is obtained and mortgage payments can begin.

While projects are being constructed to minimize capital costs to stay competitive on selling prices, the projected outlook is that building systems will likely require maintenance, repair and replacement earlier than in the past. The heads-up is that condo fees, AFTER the first year of operation, are likely to escalate quickly.

Older condos = higher maintenance fees

You might be dodging the one-time development charge by opting to buy an older condo, but they often have higher fees. The building’s age plays a major financial role in determining the fees residents will pay.

The general rule is this: The older the building, the higher the maintenance fee. One reason is that utilities are normally included in older builds, as opposed to newer condos, in which you’ll pay utilities over and above your occupancy fees. New structures will have 20 to 25 years before an underground parking garage, for instance, needs to be replaced, compared to older buildings in which replacements or repairs may need to be done now, thus raising your fee.

Calculating property tax

One expert notes that calculating the correct amount owing for property tax can be problematical, leading to errors of over-payment or under-payment. This margin of error in calculating the property tax portion of the occupancy fee could cost unsuspecting condo purchasers thousands of extra dollars. Developers are urged, therefore, to calculate the tax in the same way their particular City does, and purchasers are advised to ensure their lawyers are alerted to this problem, when they scrutinize tax calculations used by developers for occupancy fees.

Should buyers be discouraged from buying into the condo market? The consensus is no. Historically, occupancy fees are “normal” and unavoidable. With foresight, however, potential buyers are wise to take the opportunity to learn how deeply they might have to reach into their financial pockets, so they can make informed decisions about whether to buy into the condo market now, or wait until they’re better prepared.

Bio: Zoocasa is a real estate website with Toronto townhouse, Toronto condoand Toronto house listings and provides advanced search features such as property types and school boundaries.

New Build Condominium – Do You Get Interest On Your Deposits?

The short answer is ‘Yes … but’. Section 82 of the Condominium Act (“Act”) legislates that the builder (also called the declarant) must pay you interest on any funds you have paid as a deposit towards your purchase. This is great news for purchasers as we see more and more delays in the completion of new Toronto condominium projects and, as a result, builders holding purchaser deposits in trust for 3, 4, or 5 years and sometimes longer.

Sections 82(1) and (3) of the Act state the following:

    Interest

        82. (1) The declarant shall pay interest at the prescribed rate to the purchaser on all money that a person pays on account of the purchase price of a proposed unit or that the declarant credits to the purchase price of a proposed unit.

    Calculation

       (3) The interest shall be calculated from the day the person pays the money received until the day the proposed unit is available for possession or occupancy in accordance with the purchaser’s agreement of purchase and sale with the declarant.

However, the great news stops there. The ‘prescribed rate’ referred to in section 82(1) is defined in section 19(3) of Ontario Regulation 48/01 as “2% per annum below the bank rate”. Unfortunately, the current Bank of Canada overnight bank rate is 1%. Thus, if you currently have money on deposit with a builder, then it is not earning any interest. In fact, if you have had money on deposit with a builder going back as far as December 9, 2008, you have earned ZERO interest. That is the date that the bank rate dropped from 2.25% to 1.50%.

Think about the lost opportunities. If you had invested the same money in Apple stock on December 9, 2008, when the price was $100.06, your return to November 1, 2012 was 487%. Even in a conservative investment such asTD Bank stock, your return to November 1, 2012 was 97.6%.

When we meet to sign the closing paperwork and review the Statement of Adjustments, real estate purchasers buying new build condos are always shocked to find out their deposit money earned little to no interest.

Of course, this should not stop you from buying if you have found that perfect condo. However, you should be aware of what your money is doing for you while you wait for your condo to be completed.

What is a First Time Home Buyer?

If you’ve got a ton of questions about buying your first home, you’re not alone. Join @RBC_Canada and a panel of 5 experts (including myself, @DavidLFeld!) for the #FirstHome Twitter chat, on June 26 from 9-10 pm. Get answers to your most complicated questions and a chance to win RBC Visa Gift Cards!

One would think the term “First Time Home Buyer” (FTHB) can be simply defined. Unfortunately, it is not. The FTHB definition differs according to the program, CCRA HBP or Toronto Land Transfer Tax (LTT).

When discussing financing options with their mortgage specialist, buyers may consider withdrawing funds from their RRSP to put toward their down payment. This can be done tax free under the Canada Revenue Agency Home Buyers’ Plan (HBP) so long as certain conditions are met, including the requirement for the buyer to be a FTHB. For the purposes of the HBP, a FTHB is a person who has NOT:

At any time during the period beginning January 1 of the fourth year before the year of the withdrawal and ending 31 days before the date of withdrawal, you or your spouse or common-law partner owned a home that you occupied as your principal place of residence.”

This means for the HBP, one can potentially be considered to be a FTHB every five years. FTHBs under the HBP often take this to mean they are also eligible for the FTHB land transfer tax (LTT) rebates, which gives Toronto FTHBs an instant rebate of up to $5,725 off the LTT(MLTT + Provincial Land Transfer Tax PLTT combined). That is not so. In order to qualify for the LTT rebates, a FTHB is a person:

who has never owned a home ANYWHERE IN THE WORLD; and
whose spouse has not owned a home anywhere in the world while being the spouse of the FTHB

The term “spouse” means married or in a common law relationship (continuously lived together for at least 3 years – or shorter if parents of a child).

See the difference? For LTT rebate purposes, your FTHB status will never reset. Also, for LTT rebate purposes, you will not be considered to be a FTHB if your spouse (married or common law) owned a home while being your spouse.

It is entirely possible for one to be considered a FTHB for the purposes of the HBP, but not a FTHB for the purposes of LTT rebates. Buyers are urged to consult an experienced mortgage specialist and real estate lawyer, lest they be shocked by having to pay more than anticipated.

For more information on the Home Buyers’ Plan, including spousal eligibility, you can visit theCRA website. For more information on LTT, please visit the City of Toronto City of Toronto.

This post content is sponsored by Royal Bank of Canada, however the views and opinions expressed herein represent my own and not those of Royal Bank of Canada or any other party and do not constitute financial, legal or other advice.

When do I get my Keys?

I am lucky because I get to meet a lot of people in a day. A lot. From nervous first time home buyers to ballin’ international investors in Lambos, we always get the same simple question – when do I get my keys?

There are legal answers and practical answers to this question. The practical answer is that for 95% of the time, for resale properties, you can expect to pick up your keys at your lawyer’s office “some time” between 3:30 and 5:00 p.m. ON THE DAY of closing. So make your MOVING PLANS ACCORDINGLY.

Legally, Agreements of Purchase and Sale say that vacant possession must be given to you by 6:00 p.m. This is why we always give both answers. So, the legal answer is that you have until 6:00 p.m. to receive your keys (and your new castle should be vacant at that time), but in reality you usually get them around 3:30 to 5:00 pm and can expect that the seller’s MIGHT still be in the property as you arrive. To avoid the awkward OH SO YOU’RE THE NEW OWNER, OH SO YOU ARE THE GUYS THAT LIVED HERE moment you might want to SHOW UP ON THE LATER SIDE OF 5:00 P.M. AND BOOK MOVERS AND ELEVATORS ACCORDINGLY.

Real estate

Category: Real estate