# Buying vacant land 101?



## jtmann

Looking for checklist of things to do to buy vacant land without me (as buyer) or seller needing to engage lawyers. 

Also, how (I am assuming I should) do I confirm that seller has no liens? Can CRA put lien land I might buy from seller if seller has outstanding income taxes?

Can municipality put lien on land I might buy from seller if seller has outstanding income taxes?

Jurisdiction is NFLD

thanks!


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## OhGreatGuru

To state the obvious, that's why you pay a lawyer.


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## firsttimehomebuyertips

I know you said you didn't want to ask a lawyer, but I would say that a lawyer can easily find these things out. A lawyer is an expert and they can cover all the bases. A lawyer really would not charge much for this. If you were to miss something by doing this yourself it could be an expensive mistake. To answer your question yes municipalities and CRA can put a lien on a property.


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## jtmann

OhGreatGuru said:


> To state the obvious, that's why you pay a lawyer.


The elderly gentleman selling the land to me despises lawyers, banks etc. It's not that I am cheap.


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## Berubeland

I think the spot to go is Land Titles Registry. It's a good place to start anyways


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## Rickson9

jtmann said:


> The elderly gentleman selling the land to me despises lawyers, banks etc. It's not that I am cheap.


You should be worried about protecting your investment, not the old man.

If I wanted to hide something I'd tell you that I hated lawyers too.


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## CanadianCapitalist

jtmann said:


> The elderly gentleman selling the land to me despises lawyers, banks etc. It's not that I am cheap.


It sounds suspicious to me. I would be careful about buying anything significant without doing your DD.


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## leslie

I answered you post on the other forum.

You are making the presumption that you cannot use a lawyer just because he does not want to use one. Not so. The two sides to any contract must have their own lawyer (or not as they choose). 

He faces no risk in this situation, and you are left holding whatever comes with the property. You need to either know what you are doing, or use a lawyer. Your lawyer does not need the sellers permission or even awareness to do his job. Usually the two lawyers will deal directly with each other, cutting both parties out of the discussions, but it is perfectly OK for you to tell your lawyer to deal ONLY with yourself, and you deal with the seller.


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## OhGreatGuru

There may be reasons why this old coot doesn't like lawyers - maybe there are problems with title to the property. You hire a lawyer to protect your interests - not his. He doesn't have to hire one.


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## Rickson9

If you don't want to pay a lawyer right now, just write up a non-binding Letter of Intent and ask him to sign it.


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## ThickenMyWallet

I agree with Rickson9. Lock up the vendor in a non-binding LOI where the only binding legal obligation is the vendor`s agreement not to sell the land to any other party for a period of time. Once you have that, ask a lawyer to run a title search which would show any liens, executions, right of ways, easements or other encumbrances registered against title.

If the vacant land is not next to developed property then you have to go down to the municipality or county and see where the services run. If they do not run to the property line and you have no water on site, you have an issue. Good luck.


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## jtmann

Thanks. I have run title searches and they are clear. Here's what I am now questioning:

1. Property taxes - it is rural land he bought in 1983. I thin k the municipality has lost track of owners fifty years ago - the seller never got a tax bill even though registered in reg of deeds. My questions:
a) Could he sell it to me then when I register the land it hits the municiplaities radar - could they try to get me to pay the property taxes from 83-now that he owed or worse try to take the land?
b) Do municpalities have to register land tax arrears or liens with reguistry of deeds?

2. CRA - same questions

Yes, I am going to get a lawyer. Just trying to undertsnad how municpal property and CRA tax arrears/liens relate to provincial registry of deeds. 





ThickenMyWallet said:


> I agree with Rickson9. Lock up the vendor in a non-binding LOI where the only binding legal obligation is the vendor`s agreement not to sell the land to any other party for a period of time. Once you have that, ask a lawyer to run a title search which would show any liens, executions, right of ways, easements or other encumbrances registered against title.
> 
> If the vacant land is not next to developed property then you have to go down to the municipality or county and see where the services run. If they do not run to the property line and you have no water on site, you have an issue. Good luck.


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## leslie

Well this is just common sense. Do you REALLY think the municipality decided not to tax the property just because they could not find the owner? Do you really think the property has just fallen off the tax roles? Do you really think they won't come to the person left holding the asset when they want to collect?


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## cjay

*checklist*

Here's a checklist I used to compare properties when I was buying vacant land in NS. I ruled out a few places based on this and learned a lot by talking to pros (well diggers, septic guys, power guys, municipal offices). I cobbled it together from a few places on the net and added some lessons I learned along the way. I still used a lawyer when I finally found a place and got title insurance as well

Enjoy! 

*** Vacant Lot Checklist

Size
x acres
feet ocean frontage
road frontage

Zoning
Check Municipal Land Use Bylaw 
Is already subdivided?
Lawyer to confirm

Access to Property
Public or private road?

Protective Covenants
Are there any protective covenants (as implemented by the developer)?

Services available
Power: available. Check approximate distance to lot.

Phone? Check approximate distance to lot.

Water: assume drilled well. See what is registered with DOE. Get estimate from well driller.

Septic: assume onsite C3. Ask the owner if a percolation test has been done for a sewage disposal system. If not, have a percolation test contingency clause inserted in the contract of sale. Get estimate for C3 septic system. 

Natural Gas: No

Building Site
Is the land easy enough to build on (check with a trusted contractor)?
Driveway in – gravel?
Steep slope/erosion controlled area (shoreline) – soil erosion control restrictions
Site line protected (building height limited to 25 feet)
Any water front restrictions? Setbacks? Check with municipality

Any changes to zoning planned? Check with municipality. Reviewed Land Use and Secondary planning docs looks OK

Expert Opinion
Consider using a building consultant and Real Estate Lawyer

HST
Check if included in price

Price
Asking
Days on Market:
Get selling price for comparables from realtor

Other
* Taxes? Check if taxes are capped and willreset to market on sale

* Review Property Deed and Title

* Will the property accommodate a walk-out or daylight basement? (Beware of severe sloping grades which may require additional foundation).

*How big is the lot? Will it accommodate your new dream home?

*Will the property accommodate the desired home placement - such as side load garages or other layout considerations?

*Are there minimum amenities required by the neighborhood?

*Has the property been surveyed and the boundaries clearly identified? Ask seller to provide valid survey

*Are there any recorded easements that need to be considered?

*Does the property have a large enough area designated to build your home based on the survey? (This is also known as the building envelope).

*Is there any clearing of the lot needed in order to proceed with construction, or any other objects that may need to be removed prior to construction?

*Is the property located on undisturbed soil or does it require additional soil engineering?

*Is there any evidence of wetland plants located on the property, such as cattails, or any evidence of a high water table?

*Check with the planning board to determine what type of development is planned in the area. 

*Determine if there are oil or gas leases on the property. 

*Check with the town building or zoning department to find out: What building and other permits are required and the zoning requirements that will have to be satisfied--minimum square footage, minimum lot size and minimum frontage. 

*Check to see if the property is in a flood zone. 

*Determine whether state, county or local subdivision regulations have been met. 

*Make sure that the contract of sale indicates the lot's dimensions and size. The contract should also require the seller to have the lot staked by a surveyor. 

*Check for signs of hazardous waste dumping by having an environmental study done. 

*If public water is not available, obtain an estimate from a well digger. 

*If the property is in an agricultural district, farming activities may cause noise, dust and odors. 

*Insert a contract provision stating that the contract is subject to your attorney's approval as to form and content

What to look for in a Oceanfront Home taking into consideration future Water levels rising and or Tidal Surge damage due to hurricanes. Look for atleast 2.5 Meter or 7.5 ft vertical setback from the high tide mark for any home foundation. I seriously doubt that global warming will affect the average home's flooding potential on the Ocean by more than 6 inches in the coming 50 years. The biggest risk is Hurricane damage. 

One must exercise caution when looking at purchasing a property that has very little elevation. Our new rules in Nova Scotia for developers is such that no part of the property may be altered inside of 60 ft from the high tide mark and also the 7.5 ft. mark. This is new legislation and affects septic systems and new home setback as well.

As far as septic systems go. In Nova Scotia the septic system is not grandfathered.-ie: If you buy a home with oceanfront or not - If the septic system fails and you don't have clearances from existing wells and watercourses you will automatically have to get an engineered field put in. These run close to $30,000 CDN.


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## OhGreatGuru

_1. Property taxes - it is rural land he bought in 1983. I thin k the municipality has lost track of owners fifty years ago - the seller never got a tax bill even though registered in reg of deeds. My questions:
a) Could he sell it to me then when I register the land it hits the municiplaities radar - could they try to get me to pay the property taxes from 83-now that he owed or worse try to take the land?
b) Do municpalities have to register land tax arrears or liens with reguistry of deeds?_
I don't know what their administrative process is. But municipalities can seize properties and sell it for non-payment of taxes. There are half a dozen such properties up for sale in my local newspaper today. 

I find it hard to believe the municipality just "lost track of owners" 50 years ago. Ownership is recorded in the land Titles Office. If the municipality can't find your current "owner", maybe he never properly acquired title to it. Or maybe he knows there's 50 years of back taxes owing, and doesn't want you to hire a lawyer to look into it. See a lawyer.


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## jtmann

Thanks cjay - one of the best replies I've gotten on any forum. Kudos to you



cjay said:


> Here's a checklist I used to compare properties when I was buying vacant land in NS. I ruled out a few places based on this and learned a lot by talking to pros (well diggers, septic guys, power guys, municipal offices). I cobbled it together from a few places on the net and added some lessons I learned along the way. I still used a lawyer when I finally found a place and got title insurance as well
> 
> Enjoy!
> 
> *** Vacant Lot Checklist
> 
> Size
> x acres
> feet ocean frontage
> road frontage
> 
> Zoning
> Check Municipal Land Use Bylaw
> Is already subdivided?
> Lawyer to confirm
> 
> Access to Property
> Public or private road?
> 
> Protective Covenants
> Are there any protective covenants (as implemented by the developer)?
> 
> Services available
> Power: available. Check approximate distance to lot.
> 
> Phone? Check approximate distance to lot.
> 
> Water: assume drilled well. See what is registered with DOE. Get estimate from well driller.
> 
> Septic: assume onsite C3. Ask the owner if a percolation test has been done for a sewage disposal system. If not, have a percolation test contingency clause inserted in the contract of sale. Get estimate for C3 septic system.
> 
> Natural Gas: No
> 
> Building Site
> Is the land easy enough to build on (check with a trusted contractor)?
> Driveway in – gravel?
> Steep slope/erosion controlled area (shoreline) – soil erosion control restrictions
> Site line protected (building height limited to 25 feet)
> Any water front restrictions? Setbacks? Check with municipality
> 
> Any changes to zoning planned? Check with municipality. Reviewed Land Use and Secondary planning docs looks OK
> 
> Expert Opinion
> Consider using a building consultant and Real Estate Lawyer
> 
> HST
> Check if included in price
> 
> Price
> Asking
> Days on Market:
> Get selling price for comparables from realtor
> 
> Other
> * Taxes? Check if taxes are capped and willreset to market on sale
> 
> * Review Property Deed and Title
> 
> * Will the property accommodate a walk-out or daylight basement? (Beware of severe sloping grades which may require additional foundation).
> 
> *How big is the lot? Will it accommodate your new dream home?
> 
> *Will the property accommodate the desired home placement - such as side load garages or other layout considerations?
> 
> *Are there minimum amenities required by the neighborhood?
> 
> *Has the property been surveyed and the boundaries clearly identified? Ask seller to provide valid survey
> 
> *Are there any recorded easements that need to be considered?
> 
> *Does the property have a large enough area designated to build your home based on the survey? (This is also known as the building envelope).
> 
> *Is there any clearing of the lot needed in order to proceed with construction, or any other objects that may need to be removed prior to construction?
> 
> *Is the property located on undisturbed soil or does it require additional soil engineering?
> 
> *Is there any evidence of wetland plants located on the property, such as cattails, or any evidence of a high water table?
> 
> *Check with the planning board to determine what type of development is planned in the area.
> 
> *Determine if there are oil or gas leases on the property.
> 
> *Check with the town building or zoning department to find out: What building and other permits are required and the zoning requirements that will have to be satisfied--minimum square footage, minimum lot size and minimum frontage.
> 
> *Check to see if the property is in a flood zone.
> 
> *Determine whether state, county or local subdivision regulations have been met.
> 
> *Make sure that the contract of sale indicates the lot's dimensions and size. The contract should also require the seller to have the lot staked by a surveyor.
> 
> *Check for signs of hazardous waste dumping by having an environmental study done.
> 
> *If public water is not available, obtain an estimate from a well digger.
> 
> *If the property is in an agricultural district, farming activities may cause noise, dust and odors.
> 
> *Insert a contract provision stating that the contract is subject to your attorney's approval as to form and content
> 
> What to look for in a Oceanfront Home taking into consideration future Water levels rising and or Tidal Surge damage due to hurricanes. Look for atleast 2.5 Meter or 7.5 ft vertical setback from the high tide mark for any home foundation. I seriously doubt that global warming will affect the average home's flooding potential on the Ocean by more than 6 inches in the coming 50 years. The biggest risk is Hurricane damage.
> 
> One must exercise caution when looking at purchasing a property that has very little elevation. Our new rules in Nova Scotia for developers is such that no part of the property may be altered inside of 60 ft from the high tide mark and also the 7.5 ft. mark. This is new legislation and affects septic systems and new home setback as well.
> 
> As far as septic systems go. In Nova Scotia the septic system is not grandfathered.-ie: If you buy a home with oceanfront or not - If the septic system fails and you don't have clearances from existing wells and watercourses you will automatically have to get an engineered field put in. These run close to $30,000 CDN.


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## OhGreatGuru

PS. Let us know how it turns out. We would all like to know if your lawyer turns up anything strange about this deal.


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## Cal

a) Could he sell it to me then when I register the land it hits the municiplaities radar - could they try to get me to pay the property taxes from 83-now that he owed or worse try to take the land?

A similar situation happened to me....tax bill came, asking for tax money owed before I was owner, I did not have forwarding address of previous owner, and lawyer for previous owner had passed away, new lawyer was basically ignoring the paperwork that my lawyer had forwarded (my lawyer was the same lawyer that I used when I purchased)....bottom line is that the title insurance covered all outstanding money, and it didn't come out of my pocket.


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## jtmann

Thanks. What is title insurance?



Cal said:


> a) Could he sell it to me then when I register the land it hits the municiplaities radar - could they try to get me to pay the property taxes from 83-now that he owed or worse try to take the land?
> 
> A similar situation happened to me....tax bill came, asking for tax money owed before I was owner, I did not have forwarding address of previous owner, and lawyer for previous owner had passed away, new lawyer was basically ignoring the paperwork that my lawyer had forwarded (my lawyer was the same lawyer that I used when I purchased)....bottom line is that the title insurance covered all outstanding money, and it didn't come out of my pocket.


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## Rickson9

jtmann said:


> Thanks. What is title insurance?


Understanding Title Insurance
http://www.fsco.gov.on.ca/English/PUBS/consumerbrochures/undstitins.pdf


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## OhGreatGuru

Cal said:


> a) Could he sell it to me then when I register the land it hits the municiplaities radar - could they try to get me to pay the property taxes from 83-now that he owed or worse try to take the land?


In a word, yes. If you buy the land you are buying any debts or liens on that land. That's why you pay people to search for such problems beforehand. Frankly your lawyer will prefer that you consult him before you even sign an offer to purchase, or he may not be able to get you out of a bad deal without a loss.


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## leslie

For pete's sake. You cannot buy insurance to pay for a liability you know full well exists and willfully DO NOT disclose.

An even mediocre notary-public will prepare a reconciliation of ongoing costs to be the final adjustment to the actual transaction price. On that list is the property tax already paid for the rest of the year (in normal people's circumstances). In your case the amount would be in reverse and include all the years' unpaid taxes. His failure to create this schedule (because you tell him not to) is admission of your complicity in this arrangement.


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## Cal

'A similar situation happened to me....tax bill came, asking for tax money owed before I was owner, I did not have forwarding address of previous owner, and lawyer for previous owner had passed away, new lawyer was basically ignoring the paperwork that my lawyer had forwarded (my lawyer was the same lawyer that I used when I purchased)....bottom line is that the title insurance covered all outstanding money, and it didn't come out of my pocket.'


My bad, I should have added that this tax bill that was received, was b/c of an adjustment made by the Town of Markham.....so technically it didn't exist at the time of the transaction, and all information regarding the property was disclosed at the time of the transaction.

Nonetheless, the mortgage insurance covered the previous owners tax bill, that came to me the new homeowner. As the bill clearly stated that it was because of a tax adjustment made after that date of purchase, although the period that was adjusted was when the previous owner was in possession of the home.


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