Thursday, June 27, 2013

Stan Gelman - Hiring Real Estate Lawyer Mississauga

At what point during your real estate purchase you should consult a lawyer to clearly understand what you are committing to?

The Lawyer handling your real estate purchase carries out the instructions that are agreed upon in the contract.  The time to make changes and corrections is before the document is Firm and Binding.

Your contract should include a condition for Financing for a specific period of time, if you are obtaining Financing. It should also include a Clause for a Home inspection  by a Qualified and Licensed Home Inspector. Additional Visits into the subject property for trades, people to quote for repairs, renovation and measurements require an additional clause.  Be sure to include that the SELLERS will give permission for trades to take pictures and measurements. Visits are meant to show your family what you purchased or re-measure for draperies.

This is a good time to include the Home Owners Insurance Broker and a Search of the Insurance Claim history.  Have there been any previous flood or fire damage claims? Does the house have old wiring or an oil tank?  Call for details.

It's most important today, to make sure that all your closing costs are capped from the builder/ developer to be a specific amount should municipalities change their lot Levy's; while you are dealing with the Period of Rescission. (cooling off period)

Once an Offer to Finance has been received; Commitment Letter, it will often detail the LENDERS requirements.  Review this carefully with your lawyer and Mortgage Broker that you can accommodate all the required terms. 

The contract should clearly state IF there is additional HST applicable above the purchase price. 

Title Insurance is often a mandatory request that is purchased at the time of closing.
You will also pay Land Transfer Tax on the amount of the Purchase Price. 

Searches need to be conducted for any outstanding work orders from the City PLUS any judgements or liens against the property. (that the previous owners may have) The utilities and taxes need to be verified. You may be eligible for Tax Rebates as First Time Home Buyers. Land Transfer Tax calculator.

Your real estate lawyer works in your best interests to secure, probably the most expensive purchase families make.  During the time you are at the lawyers office,  give some thought to how you hold title (who's name the house be registered) whether it is Joint Tenancy or as Tenants in Common. This is the time to discuss survivorship, your will and testament.   
You will receive a Statement of Adjustments (who pays for what) prior to closing, preparing you for the amount of funds to bring to the closing inclusive of fees, taxes and net of your deposit. You will need to bring Photo ID and a credit card for Identification.

Here at Stan Gelman QC use trusted and knowledgeable real estate lawyers and Law clerks. For more information, or a detailed quote please contact me at 905.270.5110.

Stan Gelman QC

Wednesday, June 5, 2013

Rent Controls will impact your Toronto Investments

A lack of affordable housing has been problematic in Toronto for decades. Metro Housing is in decay and has a huge backlog of repairs in addition to a long waiting list of applicants.   Rent geared to income housing is a small portion of the rental pool and in the last 20 years individual investors have purchased units for rental purposes and placed them in the secondary markets.

The Federal Government has introduced the Affordable Housing Act with Bill 140 passed in January or 2012 but municipalities have yet to embrace available 140K per unit in construction or remodelling assistance. 
The LTAHS provides recognition of the important role played by municipal Service Managers in long-term planning of the housing and homelessness service systems in Ontario. The Strategy also proposes a new approach for funding of housing and homelessness services that is intended to reduce administrative complexities and create greater local flexibility in identifying priorities and innovative solutions. In some areas, the new Housing Services Act is less prescriptive and gives Service Managers greater flexibility than the previous SHRA.

It's not that a landlord has a tough time finding tenants;  The Residential Tenancies Act provides free legal services to Tenants in addition access to Duty Counsel at Hearings.  The Landlord must now be represented by a licensed Paralegal or Lawyer, unless they are experienced in the process.

The Human Rights Tribunal has decided that Credit Bureau's and Beacon Scores can not be used to determine the applicants ( tenants ) worthiness for an apartment or rental unit. (I would like to try that at my Bank with a Mortgage Application)

But the governing Liberals are unlikely to see the rent control question the same way. Ontario’s Minister of Municipal Affairs and Housing Linda Jeffrey said this in a statement at the end of April:
The post-1991 rent exemption was originally introduced – and has been maintained over time – as an incentive for private landlords to build new rental accommodation. This incentive not only helps to renew the rental housing stock but also creates jobs in the construction sector. As such, any changes to this incentive could have an adverse effect on the rental housing sector, the economy and job creation.The NDP are hoping for a change of heart, especially as the provincial opposition have the Liberals survival — with a crucial budget vote yet to come — in their hands. They’re also arguing that the construction boom intended by the rent control changes haven’t been successful.
Forster notes that most of the new construction have been condos, sold to investors and then rented out second-hand, and not rental buildings.
“This misguided rule has not accomplished what it was meant to, and very little new rental housing has been built,” said Forster. “For tenants living in these newer buildings, it has been 20 years of uncertainty and unfairness.”

Governments control increases to HST/GST that have increased maintenance fees; The Ontario Government controls the Hydro Billing Rates (because they need approval)   Cities and Municipalites control Tax rates, water and sewage pick up fees billed directly to Condo Buildings.  NONE can be lawfully passed to a tenant in a Rent controlled building.

Vacancy Factors in Toronto are current near 1%.

If there is no available social housing, and Independent Condominium Investors have stepped up to invest in their properties and the Government then CAPS the rental increases [while clearly charging more for different services] there will be a sharpened increase in the number of TENANTS looking for units as landlords EXIT the rental pool as their profit margin is impacted.

If the NDP are successful in capping the Rent will you keep your rental unit or sell?

I personally think there are too many PLAYERS  tinkering with the real estate market; from Double Land Transfer taxes in Toronto to increasing Lot Levies, Shortened Amortization Periods, multiple providers of tenant counselling services and well meaning but hazzardous legislation setting profits and ROI.

When did it become embarrassing to make money? What's your opinion?

Keeping It?  or Selling it?  Call me!