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Disclaimer: This article on Real Estate is intended for the purposes of providing information only and is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
The average cost of homes in the GTA hit a peak of $1,086,493 in February 2022. However, as the Bank of Canada raised rates and the new mortgage rules came into effect, the market cooldown that followed created a much different landscape.
For those currently in the market for a new home or thinking about moving soon, it’s important to be aware of the current conditions and how they may impact your decision.
Here’s a look at a couple of key ways you can weather the current storm in real estate.
For many people entering the market, the idea of co-owning a property is an attractive option. It can be a great way to get started in real estate investing, since it allows you to pool resources with someone else. However, there are a few things to keep in mind if you are considering this option.
First and foremost, having a co-ownership agreement is not just important. It is crucial. This document will outline the terms of your agreement and should be very specific. It should cover decisions such as:
- how much will each person contributes to the purchase price?
- what is each party’s responsibilities?
- what happens if one person wants to sell?
Without a well-drafted agreement, you could find yourself in a very difficult situation down the road.
What if you already co-own a home, but don’t have a co-ownership agreement? You should still execute one as soon as possible. It is certainly not too late and can save you a lot of headaches in the future.
Buying or Selling Your Home
We discussed earlier that there is a troubling trend in the real estate industry in Ontario. The average home price in the province had risen quickly. However, as the market settled, many found it difficult to get financing for the difference between the appraised value of their homes and the outstanding mortgage. This resulted in a number of deals falling through, as people could not come up with the difference.
If you are considering buying or selling your home, it is important to be aware of this trend and its potential impact.
What if are in this situation as a buyer? In many instances, once the deal has been finalized, there are few options. However, a lawyer can walk you through what those options are and how to best negotiate the next steps.
What if you find yourself in this situation as a seller? Has your lawyer properly papered your file for potential litigation?
Retaining a lawyer with experience in both real estate transactions and litigation may be in your best interest, as this will give you the best chance of success if a deal falls through and you need to take legal action.
Buying a New Build
The new build market in Ontario has been booming in recent years. However, with the current market conditions, there are a few things you should keep in mind if you are considering purchasing a new build home.
During the COVID-19 pandemic, many builders experienced supply chain delays. Therefore, builders are permitted to delay critical dates, such as the occupancy dates, because of the pandemic. If that is the case for you, you may have already made plans assuming a specific occupancy date and you likely have no recourse against the builder for the change.
It is important that you speak with a lawyer to understand what notices you should be receiving from your builder and what timelines they are required to follow.
Weathering the Storm With Beeksma Law
The current conditions in the real estate market can be difficult to navigate. At Beeksma Law, we have a team of experienced lawyers who can help you with all aspects of your real estate transaction, from co-ownership agreements to buying or selling your home. We can also help if you find yourself in a situation where a deal has fallen through and you need to take legal action.
Please contact us today to learn more about how we can help you with any of your real estate needs.