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Buying a Home: Survey Issues

It is often a term of the Offer to Purchase that the property being purchased shall be free from encroachments from neighbouring properties, that none of the buildings being purchased are encroaching onto the neighbouring properties and that the property will be in compliance with all applicable building and zoning regulations. The only effective way for a buyer to determine if the property meets with these requirements is to obtain a Building Location Certificate (“BLC”) from a qualified Land Surveyor and to obtain a Zoning Memorandum (based on the BLC) from the local city, town, or municipal office.

If you are aware that the seller has a current BLC which accurately represents the property, you may request in the Offer to Purchase that the seller provide you with this document. However, if a new one is required, you or your legal counsel will order one from a local surveyor who will usually charge a fee of approximately $575 plus GST, however, this fee will depend upon the size, type and nature of the property being surveyed.

Upon receipt of the BLC, a certified copy of the BLC will be submitted to the local city, town or municipal office, as applicable, in order to obtain a Zoning Memorandum which will confirm whether or not the property complies with all local by-laws including yard and alignment requirements. A Zoning Memorandum will typically cost between $40 to $125 plus GST, depending on the fee charged by the city, town, or municipal office issuing the Zoning Memorandum.

Please note that it is often a requirement of your lender that a current BLC and Zoning Memorandum be obtained as part of the necessary due diligence required in order to obtain the mortgage funds. As a result, one must consider these potential additional costs when contemplating the purchase of a new property.

Many lenders will accept a policy of Title Insurance instead of a BLC and Zoning Memorandum. The Title Insurance company from whom the policy of insurance is obtained will cover the damages suffered by an insured home owner and the lender if the claim is covered by the insurance policy. For example, if a home owner discovered that the property failed to meet all of the building and zoning requirements, then the Title Insurance company could be asked to cover the costs incurred by the insured homeowner in order to correct this problem. The cost of a Title Insurance policy is a one time cost as it will protect the home owner for as long as they own the property. The cost of a Title Insurance policy starts at $200.00, but is subject to change by the Title Insurance companies.

To get additional information about BLCs, Zoning Memorandums, and how they differ from Title Insurance, and to discuss which of these options is best for you, please feel free to contact one of our lawyers.

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Notice: The articles on our website are provided for general information purposes only and should not be relied upon as legal advice or opinion. They reflect the current state of the law as at the date of posting on the website, and are subject to change without notice. If you require legal advice or opinion, we would be pleased to provide you with our assistance on any of the issues raised in these articles.