Cottage Dreams and Legal Realities: What to Consider Before Buying a Vacation or Investment Property in Ontario

Disclaimer: This article on buying a cottage is intended for the purpose of providing information only. It is to be used only for the purposes of guidance. We do not intend that you rely on this article as legal advice and it does not purport to be exhaustive.

Many city dwellers dream of escaping the hustle and bustle of their everyday lives for the idyllic tranquility that a cottage promises. We can almost feel the cozy campfires, see the serene lakes, and breathe in the fresh, crisp air. 

Whether it’s picturing a peaceful retreat, a place to bring family together or an investment property to diversify your income, many people dream of owning a cottage. While there are many opportunities in rural Ontario to make your cottage dreams a reality, there are also many factors to consider. 

In this article, we will talk about some of those realities and how to make sure that you are making the right real estate choices for you and your family. If you own a cottage and are wondering how to include it in your estate plan, read this article here

Buying a Cottage 

There are a couple of areas that you will want to talk to your real estate team about before buying a cottage. 

Is your property zoned seasonal? If that is the case, that means that the municipality may not provide services – such as snow removal – which may prevent you from enjoying your property year-round. 

Is your property on a shoreline? If so, you will want to confirm your access rights as as they relate to the water and the shoreline. You will also need to confirm that the local conservation authority has not placed any restrictions on how you can use the shoreline. 

Other Rural Property Considerations 

There are specific considerations that you need to think about when buying a rural property, such as the examples listed below. (This list is not exhaustive – you will want to discuss your property with your real estate professionals.)

Shared Well Agreements

As we mentioned in this article, some properties share a well with their neighbours and require a shared well agreement. This well help determine who is responsible for any maintenance that comes up and if there are any limits to its use. 

Surveys to be completed 

When purchasing an agricultural or mixed-use property, a survey is typically required. However, for other properties, a survey can be optional. It is helpful to determine accurate boundary lines, especially in large, unfenced properties. Surveys can take months to complete. Therefore, it’s advisable to discuss scheduling it after the closing date unless it’s a required zoning requirement.

Water Testing & Septic Tank Inspections

Does your property connect to the municipal water supply and sewer system? If not, your lender will typically ask for two inspections: water testing and septic tank inspections. These inspections ensure that your water source and sewage systems are safe, giving you and your lender peace of mind.

Your water test will examine various parameters such as bacterial contamination, mineral content, pH levels, and any harmful substances. Septic tank inspections are equally important when it comes to cottage properties not connected to the municipal sewer system. An inspection evaluates the overall condition of the septic system. The inspector will check for any signs of malfunction or damage that could pose environmental and health risks. 

Investment Properties & Short-Term Rentals 

Purchasing a cottage with the intention of using it as an Airbnb can be an exciting opportunity to generate income. However, before making a purchase, it’s essential to familiarize yourself with municipal requirements and bylaw restrictions. 

For example, Collingwood’s zoning bylaw defines “short term accommodation” under it’s Zoning By-law No. 2010-40 as:

“the use of a dwelling unit, or any part thereof, that is operating or offering a place of temporary residence, lodging or occupancy by way of concession, permit, lease, license, rental agreement or similar commercial arrangement for any period of 30 consecutive calendar days or less, throughout all or any part of a calendar year.”

That same bylaw only allows short-term rentals in bed and breakfast establishments.  

On the other hand, Owen Sound recently defeated a motion to limit some short term rentals. 

Each municipality in Ontario has its own set of regulations that govern short-term rentals, ensuring compliance with safety, zoning, and taxation standards. If your intention is to use your cottage as a short term rental property, make sure that you are legally able to do so. 

Beeksma Law: Helping you enjoy your vacation property

At Beeksma Law, we want to help you navigate the complexities of buying a cottage property in Ontario. We are here to ensure you can enjoy your vacation property to the fullest. We understand the unique considerations and legal requirements involved in cottage ownership. Therefore, our team can provide expert advice and guidance throughout the process.

Book your complimentary consultation with our team today to discuss your cottage property needs. Our dedicated team of professionals is ready to guide you through the process and protect your interests.

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