Tania Ellerbeck, Author at Tania Ellerbeck

What to do Before You Move Out

Posted on June 19, 2023June 20, 2023 by Tania Ellerbeck

You have a firm accepted offer on your home. Congratulations! After weeks of keeping your house spotless and in ready-to-show condition, you’re ready to start packing. It’s easy to get caught up in the excitement of moving to your new home but you still have some responsibilities to the buyers of your current home.

Clause 10.2 of the Promise to Purchase, which you signed when you accepted the buyer’s offer, reads as follows:

The SELLER promises to sell the IMMOVABLE to the BUYER and, unless stipulated otherwise in clause 12.1, undertakes to deliver the IMMOVABLE in the condition in which it was when the BUYER visited it.

You are required to deliver the home in the condition it was in when the buyers visited it. You’re responsible for the care and maintenance of the house until the occupation date. If something stops working or gets damaged between the time the buyers visited and the time they take possession, you are required to repair it.

This means you still have to mow the lawn and clean the pool and rake the leaves. If a tree falls on the property, you have to have it removed. If the sprinkler system breaks, you have to get it repaired. If you accidentally damage the drywall moving your furniture out, you have to patch and repaint it.

In the case of major damage – say the tree fell onto the house instead of into the yard – you should notify your real estate broker who will in turn notify the buyers and their broker. Depending on how bad the damage is, the buyers might want to be consulted on the repairs carried out, for example picking out finishes or paint colours.

Clear the Property

In addition to handing over the property to the buyers in the condition they saw it, you are also required to remove ALL of your personal belongings.

Clause 11.2 of the Promise to Purchase reads as follows:

OCCUPANCY OF PREMISES – The SELLER undertakes to render the immovable available for occupancy by the BUYER as of (date & time), and to leave it free of any property not included in this promise to purchase or not assumed by the BUYER, failing which the BUYER may have it removed at the SELLER’s expense.

Unless it’s built-in or you otherwise agreed to it with the buyers, you must remove everything from the house when you move out – every piece of furniture, every garden tool in the shed, every last paint can in the basement.

Anything you leave behind can be disposed of by the new owners and you will be billed for the cost of removal. Be warned that this could end up being very expensive because the buyers aren’t required to find the best price for the removal [Check out our guide to Downsizing for some ideas on what to do with your extra stuff].

Once your house is empty, clean it thoroughly. A professional cleaning service can do the job quickly and efficiently, at a fairly reasonable cost.

Notify the utilities (electricity, gas/oil, internet, etc) of the date you’ll be transferring ownership so that the new owners can set up their utilities.

Finally, collect all keys and door openers, and provide access codes where applicable. Leave them in an easy to find spot or hand them over to the notary on the day of signing.

Not required, but nice to do

In the interest of maintaining a friendly relationship with the buyers, there are some extra things you can do to make settling into their new home easier:

Gather all manuals and warranty information for appliances and systems.

Share documentation and contractor information for any renovations, updates and repairs done, if you have them. Share contact information for reliable service providers (ex plumber, electrician).

Share maintenance and landscaping schedules, provide tips on seasonal upkeep and any preferred service providers. Pass along information about watering schedules or specific care instructions for plants or gardens.

Share information about the neighbourhood (garbage collection schedules, local amenities, neighbourhood associations, etc). Offer recommendations for nearby services (restaurants, healthcare facilities, etc.).

Moving can be extremely stressful, so ensuring you’ve met your obligations to the buyers – just as the sellers of the home you’re moving to will do for you – will help make everyone’s move easier.

NB The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

Latent Defects

Posted on May 22, 2023May 22, 2023 by Tania Ellerbeck

(Please note that the following is based on my informed opinion as a real estate broker and should not be taken as legal advice.)

You bought your dream home but now that you’ve moved in, you think it may have a defect. What do you do??

The first thing to do is determine whether you bought the property WITH a legal warranty or WITHOUT a legal warranty. For the purpose of this article, we’ll be looking at properties WITH a legal warranty. For information about properties sold WITHOUT a legal warranty, please check out our March 2023 article: Legal Warranties in Quebec.

Unless otherwise agreed to in your contract of sale, a property sold in Quebec is presumed to have been sold with a Legal Warranty of Quality. According to Article 1726 of the Code Civil du Quebec, “The seller is bound to warrant the buyer that the property and its accessories are, at the time of the sale, free of latent defects.”

What is a latent defect?

According to the Code Civil du Quebec, a latent defect is an issue with a property (the immovable) that is

Present at the time of purchase but is unknown to the buyer, seller or building inspector;
Not apparent at the time of the purchase;
Is serious enough that, had they known about it, the buyer would not have purchased the property OR would not have paid such a high price for it.

As a homebuyer who has discovered what could be a latent defect, you will have to prove that the problem existed at the time of purchase, which isn’t always easy. You’ll most likely have to rely on an expert to provide an analysis of the problem – including how serious it is and how long it may have been going on (for example, a small leak in a bathroom pipe that has caused the floor joists to rot over several years, affecting the structure and safety).

In addition, a latent defect is one that wouldn’t have been apparent at the time of purchase. However, the law does require buyers to take precautions when buying a home – a vendor can’t be liable if the issue could have been found by a prudent buyer carrying out an inspection of the property.

Finally, a latent defect has to be serious enough that it reduces the value of the immovable, that it renders it unfit for the use it was bought for, or that the buyer wouldn’t have bought it or paid the price they did for it.

At the time of sale, the listing broker will have the home seller complete a Seller’s Declaration, which is a required form used to disclose information about the home, such as the year it was built, what renovations have been done, and if there have been any problems with it. It’s important for the seller to fill out the Seller’s Declaration in as much detail as possible, without leaving anything out. Omitting information can have serious repercussions later on.

For a buyer, the process of discovering a hidden defect, having it fixed and getting compensation for it can be long and expensive, especially if you have to go to court. So it’s no surprise that it’s one of the most common concerns home buyers express to me, their real estate broker.

You can’t guarantee that you’ll never run into a problem, but there are steps you can take to help avoid one:

Read the Seller’s Declaration carefully and ask questions if you aren’t sure about something.
Have an inspection carried out by a reputable Home Inspector. While they can’t open up walls or pull up flooring to look for defects, they are trained to look for signs that could indicate that there’s an underlying problem. If they see anything concerning, they’ll recommend you hire an expert to come and take a closer look before you buy the property.

What do you do when you discover a latent defect?

First, document everything. Take photos and/or video of the defect and the related damage. If you have to go to court, this will help the judge to make their decision.

Next, hire an expert to do a thorough analysis and to give you an estimate of the cost to repair the defect.

Send the previous owner a registered letter advising them of the defect within a reasonable amount of time after finding the defect (Article 1739 of the Code Civil du Québec) and giving them an opportunity to have the defect inspected. I always recommend consulting with a lawyer for help drafting the letter.

It’s also a good idea to check with your real estate broker to see if they have an insurance program that might be able to help you. I offer qualifying clients Royal LePage’s Protection Royale, which provides insurance and legal advice relating to latent defects for a year after purchase.

Ideally, you’ll be able to come to an agreement with the seller to have the defect fixed. Failing that, you would have to take legal action and present your case before a judge. Be aware, however, that pursuing legal action can be time consuming and expensive, so make sure you have a strong case.

It’s worth noting that, should you win your case against the previous owner of your home, if they can prove that the defect existed when they purchased it, they can pursue the previous seller for damages. And there’s no limit to how far back previous owners can go, provided there’s evidence of the defect existing.

Your real estate broker is there to guide you through the home-buying process, so don’t hesitate to ask them about latent defects and how to mitigate the risks.

Sources:

OACIQ

Legallogik

Code Civil du Quebec

Legal Warranties in Quebec – A Buyer’s Guide

Posted on March 12, 2023March 12, 2023 by Tania Ellerbeck

NOTE: I am not a lawyer. This blog post contains my informed opinion as a professional real estate broker. It is not intended to be legal advice.

If you’ve been house hunting recently, you will have no doubt noticed that many listings include the clause “sold without legal warranty”. What is a legal warranty and what does it mean for you, the buyer?

In Quebec, there are two types of legal warranties applicable to the sale of a house:

1.Legal warranty of title/ownership.

The property is free of all rights except those declared by the seller;

The seller has discharged the property of all hypothecs, except for those assumed by the buyer;

The property is not subject to any encroachment on the part of the seller or a third person; and

The property does not violate any restrictions of public law, except those declared by the seller or those that the buyer should have discovered.*

2.Legal warranty of quality, meaning good working order.

Seller warrants the buyer that the property is free from defects, existing at the time of the sale, that would render it unfit for the use for which it is intended or which would so diminish its usefulness that the buyer would not have bought it or paid so high a price if he had been aware of them.*

You cannot sell a home without a legal warranty of title – you have to own the title in order to sell the house.

However, it is possible to remove the legal warranty of quality and sell the home “as is”. The relevant clause on the Seller’s Declaration will read as follows: “This sale is made without legal warranty of quality, at the buyer’s risk and peril.” Essentially, what this means is that the vendor will not guarantee the condition of the property.

There are many reasons a vendor might sell a property without a legal warranty of quality. Companies, landlords, estates and banks typically sell their properties without legal warranty of quality because they have never lived in the property and cannot guarantee it’s condition. Owners of older homes may choose to sell them without warranty because an old house can have surprises hidden behind the walls. A house with recurring issues will also be sold without warranty. For example, if the basement floods once a year, no vendor will offer a warranty. Finally, the Organisme d’autoréglementation du courtage immobilier du Québec (OACIQ) recommends older homeowners sell without warranty in case of future memory loss.

So what does this mean for the buyer?

The legal warranty protects the buyer from what is unknown at the time of the sale – a latent defect that may become apparent only after the buyer moves into the home.

When a property is sold WITH a warranty, the buyer can legally pursue the seller for money to repair the problem that existed when they purchased the property, even though no one was aware of it at the time of the sale. The burden of proof lies with the buyer, or now new owner, to prove the problem existed when they bought the property, no matter how long ago. Claimants can go back to past owners as well, until it can no longer be proven that the problem existed when the past owner purchased the house.

In an effort to curb endless legal pursuits that can potentially cost the parties involved thousands of dollars in legal fees with no satisfactory resolution, homes are being listed without legal warranty more often. When they agree to this condition in the purchase contract, buyers are acknowledging that they’re foregoing the ability to pursue the seller for hidden defects in the home.

However, there’s a big difference between a home sold in good faith that has some unexpected issues and a home whose issues have been intentionally hidden in order to sell or to obtain a higher sales price. Sellers can’t hide behind the veil of no warranty in that situation. The buyer/new owner still has recourse against the previous owner if they don’t declare an issue they know about, even if they sell without legal warranty.

As a buyer considering making an offer on a home without a legal warranty of quality, it’s important to have a thorough inspection done. In addition, check with the town for any potential zoning or boundary issues. The more information you have about the current condition of the home and the potential problems it might have, the better protected you’ll be.

Working with an experienced real estate broker who knows the area and is familiar with some of the more common potential problems you might encounter, such as iron ochre or seasonal flooding, can also be extremely helpful.

Once you have done all that and are happy with the results, you can negotiate the price to compensate for the added risk of buying a home with no warranty. No home will be perfect, but doing your due diligence can help you avoid big problems.

*Source: OACIQ

Don’t Forget the Welcome Tax!

Posted on February 12, 2023 by Tania Ellerbeck

When you buy a home in Quebec, you are required to pay a Land Transfer Tax, also referred to as the “Welcome Tax” thanks to the former Quebec Minister of Municipal Affairs, Jean Bienvenue (which means welcome in French), who was responsible for instituting it. The municipality will send you an invoice in the weeks following the signing of the Deed of Sale.

The Welcome Tax is based on:

the sale price OR

the evaluation price of a property OR

the amount of the consideration stipulated in the Act of Sale, if different from the price paid (for example if given as a gift).

The Municipality will take the highest of the three as the basis for their calculations. In addition, many Municipalities are also now multiplying the base number by an extra amount, a Comparative Factor, that changes yearly. In 2023, the Comparative Factor in Vaudreuil and Hudson is 1.28%, so the Welcome Tax on a $500,000 home, for example, would be calculated on a base of $506,400 ($500,000 x 1.28% = $506,400). In Saint-Lazare, the Comparative Factor is 1.33%, so a $500,000 home would have a base value of $506,650 ($500,000 x 1.33% = $506,650).

Once the base is determined, it is broken down into increments which can vary by municipality.

The breakdown for Vaudreuil, St Lazare and Hudson is:

The first $55,200 is multiplied by 0.5%

$55,200 to $276,200 is multiplied by 1%

$276,200 to $500,000 is multiplied by 1.5%

Anything above $500,000 is multiplied by 3%

If you were to purchase a $750,000 home in Vaudreuil or Hudson, your Welcome Tax would be calculated as follows: $750,000 x 1.28% = $759,600

The first $55,200 $55,200 x 0.5% = $276

$55,200 to $276,200 ($221,000 x 1%) $2,210

$276,200 to $500,000 ($223,800 x 1.5%) $3,357

$500,000 to $759,600 ($259,600 x 3%) $7,788

and your total Welcome Tax payable would be $13,631

In comparison, the City of Montreal has extra increments with slightly different values and in 2023 the Comparative Factor is 1%.

Up to $53,200 0.5%

$53,200 to $266,200 1%

$266,200 to $532,300 1.5%

532,300 to 1,164,600 2%

1,164,600 to 2,059,000 2.5%

2,059,000 to 3,000,000 3.5%

Over $3,000,000 4%

As you can see, the total amount of the Welcome Tax can be quite high. It absolutely should be one of the costs that figure into your offer price and your moving budget along with moving costs, utility installation costs, insurance, etc. Buying a home is an exciting and happy occasion – don’t let it be ruined by an unexpected cost!

*Please note that these numbers are subject to change and can be different from one municipality to the next. Always check on the town’s website for the latest numbers. Your notary will give you the final value. The above numbers are not guaranteed by us, they are only intended as a guideline.

**The numbers above were taken from the website of each Municipality mentioned.

Town of Hudson

Town of Saint-Lazare

City of Vaudreuil-Dorion

The Buyer’s Contract to Purchase

Posted on October 31, 2022 by Tania Ellerbeck

The Buyer’s Contract to Purchase is a legal contract that allows a real estate broker to represent a buyer in a residential real estate transaction.

Until recently, a verbal agreement between broker and buyer was all that was needed for a broker to represent a buyer, although brokers could – and did – use signed contracts in certain situations. In June 2022, a change to the Quebec Real Estate Brokerage Act made it mandatory for a broker to have a signed Brokerage Contract in order to represent a buyer. Along with changes to rules regarding double-ending, the updates to the Act are intended to clarify brokers’ obligations and responsibilities toward their clients, thereby assuring a worry-free transaction (We discussed these changes to the Act in a previous blog post).

The Brokerage Contract to Purchase clearly identifies what the clients are looking to purchase. It also clearly identifies the broker’s obligations to the buyer, including:

the broker is required to promote your interests and protect your rights
the contract clearly spells out your rights and the terms of your relationship with the broker
clearly-defined client objectives
access to for-sale-by-owner properties
advice on offer price + offer submission
negotiation on your behalf
assurance that the broker is representing your needs
the OACIQ is very strict when it comes to enforcing the Real Estate Act so you can have more confidence in your broker and your transaction

By signing a Brokerage Contract, buyers are giving the broker the exclusive contract to represent them in the home-buying process in the area and to uphold the stipulations specified in the contract. Buyers can visit open houses without their broker, but they must let the listing broker know they have a signed contract.

The Brokerage Contract to Purchase codifies some of the best practices brokers were applying in their practices – representing their clients’ best interests and clearly spelling out their obligations to their clients. Clarifying expectations and obligations helps build stronger relationships and helps ensure better outcomes for everyone.

In our experience, there is a clause in the contract that prospective buyers tend to be uncomfortable with, and that is the remuneration clause. Clause 6 outlines the terms of the broker’s compensation. With verbal contracts, it was understood that the buyer’s broker would get a portion of the commissions paid by the seller, but there wasn’t usually much discussion about just how much those commissions were. With the written Buyer’s Contract, the broker’s commission is clearly indicated – ahead of any offer to purchase being made. The commissions payable still come from the seller in most cases. However, if that commission is lower than the commission indicated in the contract, the buyer could be responsible for paying the difference. At Team Ellerbeck, we’ve solved this issue by adding a clause in Section 10 of the contract stating the compensation in 6.1 only applies to homes not sold on MLS and, additionally, the broker agrees to accept the compensation offered on the MLS listing, thus ensuring no surprise compensation costs.

It’s still possible to use a broker to buy a home without signing a contract BUT you lose your legal protections. Should you choose not to be represented by a broker, you can sign a waiver to that effect. But since the point of the BCP is to provide you with a worry-free transaction, waiving this right might not be in your best interest.

If you have questions about how the Brokerage Contract to Purchase will affect your home search, it would be our pleasure to discuss it with you.

Source: https://www.oaciq.com/en/pages/latest-amendments-to-the-reba

Disclaimer: Information made available in this blog in any form is for information purposes only. It is not, and should not be taken as, legal advice. It is not in any circumstances a substitute for the advice or services of a notary or lawyer. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website.

The End of Double-Ending

Posted on July 4, 2022 by Tania Ellerbeck

“Double-ending” refers to a situation where a single real estate broker represents both the Seller and the Buyer in a residential real estate transaction. It’s a practice that has long raised concerns about the broker’s ability to act in the best interests of both sets of clients.

Changes to the Quebec Real Estate Brokerage Act will effectively put an end to the practice of double-ending in order to avoid potential conflicts of interest. As of June 2022, real estate brokers will have to represent either the Buyer or the Seller in a particular transaction – not both. The goal of this Amendment is to further protect Buyers and Sellers and to promote trust in the client/broker relationship.

The Brokerage Contract to Purchase

The Amendment to the Real Estate Brokerage Act introduces another change to the way real estate is conducted in Quebec with the Brokerage Contract to Purchase. Brokers are now required to have a signed Brokerage Contract when representing Buyers. It’s long been standard practice to have a signed contract with Sellers, but contracts with Buyers have been less common.

In the past, brokers signed contracts with Sellers to represent them in the sale of their property. But for the most part, agreements with Buyers were verbal, with exceptions in cases like For Sale By Owner (FSBO) transactions. More brokers have been implementing signed Brokerage Contracts with Buyers in recent years, but it hasn’t been the norm. Going forward, Buyers will be required to sign a Brokerage Contract to Purchase (BCP) with their chosen broker before writing a Promise to Purchase on a home.

(There is a way for the Buyer to buy a home without signing a Brokerage Contract to Purchase, but they would have to waive their right to be legally represented and they would lose any protection afforded by the contract. We will explain this in more detail in a future post.)

Benefit for Clients

The Amendment to the Real Estate Act will reduce potential conflicts of interest and protect clients’ best interests. It will also help increase trust in the broker-client relationship, which is a good thing.

Reputable brokers have always done their best to represent their clients’ interests, even when double-ending. At Groupe Ellerbeck, we’ve already been doing this with our clients. One of us will represent the Seller while the other acts on behalf of the Buyer, both working our hardest to make sure our assigned clients get their best possible outcome. There have even been situations where we’ve brought in another experienced broker from our office, to ensure the highest level of fairness. We’ll continue to ensure that each client’s interests are represented in the best way possible, just as we always have.

We’ll go into more detail about the specifics of the Brokerage Contract to Purchase in an upcoming post, but if you have any questions about the new regulations and how they might affect you, we’d be happy to answer them for you.

Source: OACIQ

Do I Have to Sell My House?

Posted on October 5, 2021January 24, 2022 by Tania Ellerbeck

Once rare in our area, multiple offers, often above asking price, are becoming more common, leading clients to ask: “If I receive a full price offer, do I have to accept it?”

In short, the answer is no. The fine print on the listing sheet states that “This is not an offer or promise to sell that could bind the seller to the buyer, but an invitation to submit such offers or promises.” The seller can even counter a full price offer and ask for more money. In seller’s market, the seller has the advantage and can ask for whatever price they want.

Recently, we’ve been seeing some brokers and sellers listing properties below market value to encourage multiple offer situations and prompt bidding wars. This practice is unethical and discouraged by the real estate board.

I advise my clients to price their home at their bottom line sale price. I conduct a thorough competitive market analysis and suggest a listing price that will generate strong interest and attract financially qualified buyers. The risk with setting the listing price below market value is that buyers who are qualified at a low price range will visit and present offers when the owner knows they aren’t going to sell at that price, wasting the buyer’s time, the seller’s time and the broker’s time.

Pricing is a balancing act and the real estate landscape has changed significantly in our area over the last year and a half. Previously, brokers would list properties slightly above the market value, expecting prospective buyers to present opening offers slightly below market value. Negotiations would then take place through counter offers until a mutually agreeable price was reached. It wasn’t unusually to see as many as 7 counter offers. These days, counter offers are rare. Multiple offer situations are now the norm, with prospective buyers offering their best offer on the first offer. If the seller were to counter at a higher price, the buyers would likely walk away.

Overbidding

Another trend we’re seeing is overbidding on an offer to purchase. Buyers are anxious to do whatever they can to have their offer accepted amidst all the competition. The downside to overbidding that buyer and their brokers need to be aware of is that they may not get financing. Banks require a property evaluation before they agree to financing. If the bank evaluator appraises the property below the selling price, they can ask for a larger down payment from the buyer or only provide a mortgage for their evaluated price, which can be a problem for prospective buyers who are already pushing the limits of their budgets with their offers.

High ratio mortgages, between 5% and 19% down, can appear less desirable on an offer but are worth considering if the selling price is well above market value. The CMHC, which guarantees these mortgages, is less likely to send an evaluator to appraise the property’s value, so an offer above market value is less problematic in terms of financing.

Should you take the highest offer?

In my opinion, conditions can be more important than price in an offer. We’re increasingly seeing buyers making huge offers, only to ask for significant price reductions after the building inspection. I encourage my clients to carry out pre-listing building inspections which they can show to buyers before they make an offer, so that there are no surprises and no inflated price reduction requests.

So back to the original question, “do I have to sell to the highest bidder?” You are absolutely not bound to accept the highest offer. You can look at other conditions in the offer, like source of funds and building inspections, when making your decision. Note, however, that you’ve signed a contract with your real estate broker. Clause 7.1 (2) in the brokerage contract states that, if your broker brings you an offer that meets all the criteria you set out (price, dates, inclusions, exclusions) and you refuse that offer, they can demand to be compensated. I have yet to see a broker exercise this clause, but as the seller, you do need to keep in mind that it is a possibility.

If you have questions about pricing your home for sale, please feel free to contact us. We’d be happy to discuss the best strategy for you.

Protective Flood Zones

Posted on June 18, 2021January 24, 2022 by Tania Ellerbeck

We’ve just experienced a winter with very little snow followed by a very dry spring. We’re dealing with low water levels throughout the region and facing the prospect of a drier than normal summer. For many homeowners and prospective buyers, however, the threat of seasonal flooding is an ongoing concern.

Gone are the days when a homeowner could build a house anywhere on their property. As development has increased, municipal and provincial governments have passed laws intended to protect homeowners, their neighbours and the environment. These include rules regulating construction in flood zones.

Flood zones have received a lot of media attention in the past few years but our area has always experienced floods – it’s part of living by the lake. Major flooding usually only occurs every 20 years or so, but those of us living in Hudson, Rigaud and Vaudreuil in 2017 and 2019 know firsthand they can happen more often. I can remember Main Road by the ferry being flooded a few times during my childhood. My dad even had to rescue our neighbours by canoe in the 90s when water surrounded their home. Coming together through floods has become part of our community identity.

New flood zone laws

Most municipalities have mapped their waterfronts and produced flood line maps showing the 20-year and 100-year flood lines. By law, homeowners can’t alter the shoreline, remove trees or add structural elements such as sand/soil or retaining walls below the 20-year flood line.

Prior to the 2019 flooding, it was possible to build between the 20-year and 100-year flood lines provided certain conditions were respected. Since 2019, however, most municipalities have created new bylaws to prevent construction below the 100-year line. In 2019 the Québec government produced a Special Planning (ZIS) flood map imposing strict regulations and a moratorium on construction below the flood lines.

You can’t build a new house in a flood zone, but what about houses that are already in the flood zones? These houses have acquired rights to be there but are subject to restrictions when it comes to renovating or rebuilding. For example, you can’t add an extension to an existing house and you can’t demolish a house with the intention of rebuilding in the same spot.

There are certainly risks associated with owning a home in the flood zone. If the home is damaged during flooding and the cost to repair it is more than 50% of the home’s value, the government will force the owner to demolish it and reconstruction will not be allowed.

Following a flood, home owners must have their homes evaluated to determine the degree of damage. The town will provide the owners with the names of three local evaluators to choose from. If the evaluator determines that the level of damage is less than 50% of the value of the building, the town can grant the owner a major renovation permit to repair the house. Otherwise, the house will have to be demolished.

In Hudson, you can get a major renovations permit to renovate up to 49% of a home, which can include implementing preventive measures like lifting the house, raising the foundation above the high water level or reinforcing the foundation to withstand flooding. Depending on the size of the house, these measures can cost $50,000 and up, but they can help ensure the living space stays dry. If you want to renovate more than the 49% of the house you may have to do it in stages, applying for a second renovation permit once you have finished the first phase of renovation.

In addition to the potential cost of preventing or repairing flood damage, it’s important to look into the availability of mortgages and insurance when considering buying a home in a flood zone. Some banks will not issue a mortgage for a house in a flood zone while others will require a risk evaluation. Insurance companies will charge higher premiums for flood protection or, increasingly, refuse flood coverage altogether.

Why buy in a flood zone?

A well-built older home that has been through previous floods with minimal damage may be an acceptable risk for some buyers. If the foundation is solid and the living area high above the water line, flooding can be an occasional inconvenience instead of a catastrophe. New products designed to protect homes from flood waters can also help minimize damage and subsequent repair costs.

So build it high, keep it dry and enjoy the view!

*The information contained in this article is for information purposes only. It is not, and should not be taken as, legal advice. It is not a substitute for the advice or services of a notary or lawyer.

Downsizing

Posted on May 18, 2021January 24, 2022 by Tania Ellerbeck

The real estate market is booming. Prices are rising to levels we’ve never seen before in Hudson, Saint-Lazare, Rigaud, Vaudreuil and the surrounding areas. It’s an excellent time for homeowners who’ve been considering downsizing to take advantage of the current market conditions, pocket some money and enjoy life!

Where will I go?

The biggest concern when you’re considering downsizing is, where will you go? While a strong market can make it more challenging to find a new home, there are opportunities for those who want to stay in the area. If you’d like more information about upcoming listings, please contact us. We’d be happy to talk to you about different housing options that will soon be available.

What do I do with all my stuff?

If you lived in your home for a long time, you’ll have accumulated lots of memories and all the stuff that goes along with them. The first thing you’ll need to do is decide what you want to keep. I recommend buying garage sale stickers in green, yellow and red. Use these to mark everything in your house – green for the items you want to keep, red for those you don’t and yellow for the things you’re undecided about.

Once you’ve sorted your belongings, you can then decide if you’d like to sell what you won’t be keeping or if you’d like to donate it.

Selling your stuff

At auction. This is an option more sellers should consider. An auction house will evaluate the items you have for sale. They can then sell them at the auction house to the highest bidder or organize a tag sale in your home. I often work with Robin Pridham of Pridham Auction House. He and his team have the experience and the expertise to get your unwanted belongings sold with a minimum of stress on your part.
Do-it-yourself. If it’s something that you enjoy doing, you can try to sell your belongings yourself, whether by holding a garage sale or using sites such as Kijiji, VarageSale or Facebook Market Place. Just know that doing it yourself can be extremely time consuming and stressful.

(NOTE: At the time of publication, there is a ban on garage sales in red and orange COVID zones in Quebec, so do be sure to check the rules if you plan to hold a garage sale).

Giving back to the community

Another option available to you is donating your unwanted furniture, household items and clothing to one of several charities in the area.

Maison NOVA/La Boutique NOVA. These two stores – Maison NOVA for furniture and household goods and Boutique NOVA for clothing – are very special to me because they were founded by my mother, Janet. She works there every day! All the proceeds from your donated items support NOVA Hudson, which provides community health care and support. La Boutique NOVA/Maison Nova (450) 202-6682
The Hudson War Memorial Shop. Known locally as “The Bunker”, the shop accepts donations of clothing and small household items. Proceeds are used to fund the library and to support charities like the Old Brewery Mission and Chez Doris in Montreal. The Bunker (450) 458-4814
La Source d’Entraide Saint-Lazare. La Source accepts donations of clothing, household items and non-perishable food items. They operate a boutique and a sewing workshop and proceeds go to the Saint-Lazare food bank. La Source d’Entraide (450) 455-8000
The Hudson Firemen’s Auction. The Royal LePage Annual Firemen’s Auction is always looking for special treasures like paintings, antiques and collectibles to auction off. All proceeds go to funding the Hudson Firemen’s Christmas Basket campaign, which delivers food and gifts to local families in need. You can contact me directly to make a donation.
Local churches, the Hudson Village Theatre, Le Nichoir and many other local organizations also hold fundraisers throughout the year. Daycares will accept craft supplies; old eyeglasses can be dropped off at the optometrist’s to be donated to people in developing countries and old bicycles can be donated to Cyclo Nord-Sud.

What about the other stuff?

Once you’ve sorted everything, you’ll no doubt be left with things that can’t be sold or donated. Old electronics, paints, construction materials, etc. can be brought to the Ecocentre in Rigaud or Vaudreuil for recycling. There are local entrepreneurs who can bring your recyclables to the Ecocentre for a small fee. I’d be happy to recommend someone. Another option is to hire a company like 1-800-GOT-JUNK to take them away. As a real estate broker, I can help you get a discounted rate on their services if you choose to go with them.

For the rest, you can make your life easier and rent a small dumpster from Robert Daoust & Fils for under $500. Truthfully, whenever I do renovations in my home, I get excited because I know the dumpster is coming! While the contractors are working, I am sorting and purging my stuff.

Still too much to deal with?

If coordinating with the different organizations is more than you can handle, there are ways we can help you. We recently arranged with clients to have them leave all of their unwanted belongings in the home they were leaving. Once they were settled in their new home, I coordinated with the charities and the removal company to empty their old house.

Going through a lifetime worth of stuff can seem overwhelming but it doesn’t have to be. A good plan can make the transition to a smaller home easier. You’ll be enjoying your new life before you know it!

Cause and Effect in Real Estate

Posted on April 7, 2021January 24, 2022 by Tania Ellerbeck

The local real estate market is brisk and buyers are feeling the pressure to move quickly when a new listing becomes available. As a result, some buyers are calling the listing broker to book an appointment instead of waiting for their broker – who has been diligently searching for a home for them – to make the call. After they have visited the house with the listing broker, the buyers then call their broker to write their offer, thinking they’ve saved some time. What they don’t realize is that, per Quebec real estate law, they’ve just ensured that their broker is no longer entitled to their commission, even if they do all the work of crafting the offer and getting the best possible deal.

In real estate law, Cause and Effect says that the broker who is the cause and effect of you buying the house is the one who gets paid the commission, not the broker who did the paperwork. The listing broker you visit the house with will be considered the ‘cause’ of your purchase. Your broker, who will spend days writing the offer, overseeing the building inspection and doing the research to ensure you are protected, won’t get paid for their efforts.

Open houses

What about open houses? By law, it’s considered the same as visiting with the listing broker. However, if you tell the broker at an open house that you are working with another realtor, most brokers will respect that relationship.

Just a quick question…

“I will just call the listing broker to answer a quick question, then I will call my broker if I want to see the house.” Again, this can cause issues for your broker. Always tell the listing broker you are already working with someone if you call them with questions. Better yet, ask your broker to do it for you. They may even know the answers already!

Many buyers assume that if they visit with the listing broker they are unrepresented. In reality, according to real estate law, the listing broker automatically becomes their broker of record for that particular house.

If you like your broker and have a good working relationship with them, you should let them work on your behalf. After all, they’re in the best position to know your needs and wants and are more likely to represent you well in the negotiation process.

French Drains and Sump Pumps

Posted on March 10, 2021January 24, 2022 by Tania Ellerbeck

Growing up around horses, I often heard the expression “no hoof, no horse”. Essentially, it means that you have to take good care of your horse’s hooves or it will become lame and you’ll have no horse to ride. The same goes for houses: the foundation of a home must be solid and protected. If you don’t look after it properly, you may be putting your house at risk.

Water is one of a house foundation’s biggest enemies. Ground water and rain water will look for the lowest point and that would be the big hole in the ground where your basement is. Water pressing up against the foundation will eventually find a way in and the concrete will crack under pressure. As much as possible, homebuilders take steps to prevent water from damaging foundations. The most common way is by installing French drains.

French drains are wide drain pipes that surround the exterior foundation of the house. They are perforated to let water seep in and they rely on gravity to draw the accumulated water into the sump pump pit in your basement. Once the water in the pit reaches a certain level, the pump activates and flushes the water back out of the house and into the ditch.

So, in reality, we’re bringing the outside water in and the pumping it back out again. I know what you’re thinking: why bring it in the house? Why not have an outdoor pit? I wondered the same thing. There are outdoor pits, but they’re usually secondary pits for homes that have ongoing water issues. An outdoor pit is much more expensive to install and much harder to access for regular maintenance than a basement pit is. They need to be quite deep and so they’re usually only used in areas with very high water tables.

As a homeowner, you’ll hear your sump pump go off from time to time, especially during the spring or after heavy rains. The frequency will depend on your home. Some homeowners have sump pumps that run every day, others only once in a while. The important thing is that your pump is doing what it was meant to do – getting the water out of your house!

What if my sump pump pit is dry?

Occasionally homes will have dry sump pump pits, even in the spring thaw. This could mean that the house was built on sand or on a hill, where water is less of an issue. Newer homes often have French drains that are gravity drained directly into the ditch. If this is the case for your house, make sure to check the exit pipe from time to time to make sure the water is flowing well. Older homes may have been built before French drains were standard, or may have drains that have become blocked or crushed over time.

It’s in your best interest to make sure that your French drains and your sump pump are in good working order. Because we live in an area with a high water table, many insurance companies no longer cover damage caused by water infiltration, which can mean high repair costs for homeowners who have water issues.

Protecting yourself when buying a home with a sump pump

On the Vendor’s Declaration form, one of the questions the seller must answer is how often does the sump pump go off? If the answer is mainly during spring thaws and heavy rains, you can be reasonably certain that the drain system is working properly. However, if the answer is daily, then you know the house is in an area with a high ground water table. Is this something that would stop me buying the house? No. If there were no signs of a damaged foundation from water pressure and the humidity level was low, it wouldn’t stop me from buying. In fact, I bought my own house knowing the sump pump operates daily. I made sure there was a backup battery sump pump in case the main one stopped working or the power was out. I also have a generator in case we lose power for long periods of time. My basement is finished and dry. I do check every time there is a power outage that my backups are working properly!

However, if the water in the sump pump pit is a reddish colour, I would put on the breaks and do further investigations. Red water or a reddish jelly-like sludge in sump pump pits and street ditches indicates the presence of ferrous ochre, which is a mineral that hardens when it dries and that can block French drains. I will write a separate post on this as it can be a serious issue if the homeowner doesn’t do maintenance cleaning of the French drains. Just know that, handled properly, it can be controlled.

According to the building code of Quebec, every home should have a sump pump pit 0.25 m2 wide and 750m m deep. In addition, the pit should have an airtight, childproof cover. Most pits I see don’t have air tight covers. It’s a fairly new regulation, so we are only seeing them in newer construction. It makes sense to keep the humidity out of the basement, it’s just harder to check the pump is functioning properly.

So when visiting homes, check the Vendor’s Declaration for the frequency of the pumping and if there is evidence of ferrous ochre. Then have a look into the pit, if you can, to verify the colour of the water and size of the pit.

Make sure the hoof of the horse is sound!

For more information;

https://www.rbq.gouv.qc.ca/fileadmin/medias/pdf/Publications/francais/fiche-bonnes-pratiques-puisards-fosses-retenue.pdf

Information made available in this guide in any form is for information purposes only. It is not, and should not be taken as, legal advice. It is not in any circumstances a substitute for the advice or services of a notary or lawyer. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website.

Pre-Listing Building Inspection

Posted on February 11, 2021January 24, 2022 by Tania Ellerbeck

Recently, I had a client comment that she hadn’t realized how much work a real estate broker does after the offer to purchase is accepted. Getting a signed offer is just one part of the sales process. Getting from the signed offer to the notary’s office to finalize the transaction is just as important – and sometimes just as challenging.

The building inspection

The building inspection is one such challenge and it can cause the delay or even the cancellation of a transaction. A building inspection is a very common condition included in the Promise to Purchase. It’s intended to give buyers some protection against purchasing a property that might have major flaws that could affect its value or its safety, such as foundation cracks, roof leaks, mould issues and more. While the building inspection has its limits, it gives potential buyers a better idea of the overall condition of the property.

If the building inspection uncovers important issues with the property, the potential buyers can ask the seller to fix them before both parties go to the notary. The buyers also have the option to cancel the purchase entirely, leaving the seller right back at square one.

Disclosing the building inspection results

What sellers might not know is that, should a buyer walk away from a sale because of a building inspection, the seller must then declare the issues uncovered to every future buyer interested in making an offer. Transparency is important to avoid future lawsuits, but sometimes inspectors’ opinions differ. What if the inspector was inexperienced, overestimated the issue or was, simply, wrong? It happens.

After a bad inspection, owners should bring in experts in the field to verify the building inspector’s findings. This can take time and money, especially if the inspector pointed out several issues. For example, a foundation expert will charge hundreds of dollars to just to come and give their opinion, and while they’re carrying out their own evaluation, the seller may be missing out on new buyers.

The pre-listing building inspection

So how can a seller help ensure a negative inspection doesn’t jeopardize their sale? In my 20+ years as a real estate broker, I have seen many deals die because of building inspection issues. I would have to say that the majority could have been avoided if the owners had just invested the $500-$700 on a pre-listing building inspection. And all the heartache and stress of a failing deal could have been avoided, too.

A pre-listing building inspection allows the owner to find any issues, big or small, that might make a potential buyer hesitate. They can then choose what to fix. If there is a costly repair the owner doesn’t want to deal with ahead of time, they can simply declare it in the Seller’s Declaration and the buyers can make their offer accordingly. This way, there will be no surprises after offer negotiations.

The seller should chose a well-respected local inspector – one real estate brokers have used in the past and trust. The buyers can then decide whether to make the inspection a condition to their offer or to just read the one provided. For the seller it means a stronger offer with a higher closure rate. Remember: building inspection clauses can delay an offer becoming firm by an average of two weeks.

The only negative to doing a pre-listing building inspection is the $500-700 cost to the seller, but if it helps them make thousands of dollars more selling their home, isn’t it worth it? I recommend all my sellers do pre-listing building inspections and the ones who have, haven’t regretted it.

Pre-listing inspection reports save time, stress and money!

Sellers Declaration

Posted on November 16, 2020January 24, 2022 by Tania Ellerbeck

The Sellers declaration is what I like to call a CYA form (cover your a..) It is a form for the seller to declare to best of his knowledge, everything he knows of importance about his home to a buyer. It is to protect the seller, buyer and real estate broker so everything is transparent.

Examples of questions are; How old the furnace is, does the property conform to local by-laws, does the property have a septic tank and so on.

It is also for the seller to declare everything that is wrong with the house, is there or has there ever been, carpenter ants, a flood, foundation repairs, problems with equipment (furnace…), has it been a Grow house (drugs grown in the house), has there been a suicide or violent death in the house…

It is a 7-page questionnaire that became a mandatory form in July 2012 of chiefly residential homes with 5 dwellings or less, including immovables held in divided or undivided co-ownership(condos). It must be completed and signed at the same time as the brokerage contract.

The answers must be in good faith and to the best of the sellers’ knowledge, if the seller doesn’t know he leaves the question blank or ticks don’t know if there is that as an option.

The seller must clarify his answers and provide supporting documents if he has them. If the window leaked, what was done to fix it? If changed provide receipt if available.

One question in particular seems silly but has good reason to be on the questionnaire is,

D7.3 To your knowledge have the ever been ice accumulation or icicles hanging from the roof in winter?

The question is to see if the roof has a ventilation problem, has it ever had big icicles, ice damning… The seller in this example answered no, I personally don’t think anyone can answer no, every home has had icicles at one point. I always tell my seller to add – only small icicles, if that’s the case. Or answer no and add no large icicles on the side of the document. As the seller is signing this document and it becomes a legally binding document integrated within the Promise to Purchase, answer it carefully!

Buyers that are interested in the property will be given a copy of the declaration, so they have all the information regarding the house and can better decide if they wish to present a Promise to Purchase. Should they write an offer they must sign a copy of the declaration acknowledging receipt of it and its contents. Building Inspectors and Banks also receive a copy of the declaration.

The Declaration is to reduce the risk of legal action for the sellers by making sure buyers are well informed and have better knowledge of the condition of the property.

I advise my sellers to fill the form out in detail, don’t leave anything out. If there was a silly dishwasher leak 5 years ago, put it in! If the leak caused more damage than you believed the buyers and their inspector will have been informed and they will have had the chance to look out for signs of an issue during the inspection. Better to deal with an issue before the sale than in court after! CYA!

Why Listing High Can Backfire

Posted on July 13, 2020 by Tania Ellerbeck

“Let’s try it at a higher price first, then reduce to the broker’s suggested price later if we need to.”
I can’t tell you how many times I’ve heard clients say this. While it is a pricing strategy that gets used a lot, in my experience, it isn’t usually the best one.

Say your experienced local broker suggests listing at $349,000 but you want to try higher – $399,000 for example. You list your home at 399,000$ and all the buyers who have been looking rush to see your home in the first two weeks. They have seen everything on the market already, so they know what they can get in the $399,000 price range. And your home doesn’t compare; it’s either smaller or not as renovated as the other homes they have seen. As a result, you don’t get any offers. Meanwhile the people in the under $350,000 price range won’t visit your home because it’s out of their price range, even though your house would have been perfect for them.

Sellers often say to “tell the buyers to make an offer” but buyers in the higher price bracket won’t make a low offer on your home because they want something bigger or more renovated. Buyers in the lower price bracket won’t make an offer because they won’t even visit a home they can’t afford on paper.
So where does that leave the seller? Cleaning and prepping their house for visits that won’t yield offers. When the broker finally convinces the seller to reduce their price, the buyers in the lower price range think there is something wrong with the house because it has been on the market for so long.

I’ve seen sellers wait too long to reduce and miss the busy Quebec spring market. Buyers overwhelmingly want to move in July once school is out. There is also the quirky July 1 moving date that can affect first time buyers. Tenants in Quebec have to give notice to their landlords by March 31 that they are cancelling their lease June 30. Thus, they must buy a home by the middle of March in anticipation of a July 1^st move. The sellers of these homes must then buy a new house with occupancy for July 1^st, creating a snowball effect for 2nd and 3rd time buyers who all end up having to move around July 1st. Why do you think movers in Quebec can charge 3x their normal rate the last week of June?

If you over-priced your home and missed the influx of buyers in the spring market you can take a break from all that cleaning because you won’t see as many visits during the summer holidays. Mind you, this year maybe a little different with the travel restrictions.

In today’s market, many savvy home owners and brokers are pricing spot on or just under market value to create a frenzy in the first few days of listing and encourage multiple offers, which in turn drives the sale price over the listing price. Lately, seeing 3 to 5 offers on a property within two days of listing is a common occurrence. In the last two weeks alone, I have seen listings selling from $2,000 to $30,000 over asking within two days of listing the property. The owner only had to clean and prep for a day or two and it was sold – no months of visits!

So, if your home has been on the market for months and you’re still waiting for the right buyer, remember there are three reasons a house doesn’t sell: Location, Condition and Price, and price fixes the first two!

The moral of the story is don’t over price your home and hope for offers. Work with an experienced local broker with strong a marketing strategy, price it right, price it tight and you won’t have to hope – the offers will come to you.

Certificate of Location; What is it Really?

Posted on March 23, 2020May 6, 2020 by Tania Ellerbeck

A Certificate of Location is a document, prepared by a land surveyor(arpenteur), consisting of a plan(map) and report on the current situation and state of immovable (the piece of land and all things attached to it, house, shed, servitudes) with respect to titles, lot regulations, zoning regulations and municipal bylaws.
In the standard Quebec Brokerage contracts and Promise to Purchase forms (offer) the seller undertakes to provide the broker/buyer with a certificate of location describing the property in its current state. This means that since the certificate was made, no physical change, no zoning change, no cadastral change (Quebec’s cadastral reform started in 1994) were made. No fences/pools/windows have been added or removed, no extensions to the buildings, no buildings removed or made smaller and no landslide bylaws and no flood area changed.
The Certificate is required by the notary and the bank during the sale of the property. The notary needs it to preform a title search. It will show the notary if there are any discrepancies between the measurements, encroachments or illegal views on a neighboring property. The Board of Notaries and the OACIQ (Real Estate Association) requires that the certificate must be made within the last 10 years. Due to the frequently changing municipal by-laws and the law in the Civil Code referring to ten-year prescription that allows acquiring a right of ownership.
A listing real estate broker has a duty to check the certificate of location and tell the seller to order a new one if necessary. Using a local broker to your area is important as they will be aware of bylaw changes in your neighborhood that you may not be. An arpenteur/surveyor can take from 3-6 weeks to deliver a new certificate, depending on the time of year! There is a law that I have only seen enforce once recently, that says a notary should receive the certificate of location at least 20 days prior to the signing of the dead of sale. So again, I cannot stress this enough, as a seller you should order you new certificate before you list your home!
If a new certificate is required, it will be at the seller’s expense. Locally it cost between $750 to $1200 plus tax for a new certificate on a single-family non-waterfront home. Waterfront homes are more expensive due to the mapping of the 20 year and 100-year flood lines (the highest water level in the last 20-100 years). Houses close to ridges, ravines and wetlands can also be more expensive as the arpenteur needs to map the height of the slope, map the landslide risk zones or the proximity of the wet area.
In the past when selling an empty lot, a surveyor would do a plot survey (with or without installing markers) instead of a certificate of location, as there are no buildings to locate on the land. A survey on large plots of land can be expensive, I recently had a quote of $5000 for 100 arpents. Luckily for sellers, empty lots are not required to have a survey to be sold unless mutually agreed upon in the offer. However, surveyors are now offering to do certificates of locations on the first part of the lot closest to the road. They will ‘locate’ any servitudes, neighbor encroachments and if there is a stream on the property the surveyor will locate the protect zone around the stream (see example of stream protected zone in diagram above). As the surveyor is only surveying a small portion of the lot, the cost of the certificate is approximately the same as a single-family home.
As a seller it is imperative you understand the importance of having your up to date certificate of location ready before you get an accepted offer on your property. If you receive an offer with a 30 day closing at the notary signing and your certificate is not valid, you may have to delay the signing or you could incur extra costs to put a rush on the certificate or pay title insurance to protect yourself and the buyer. If the certificate unveils a surprise of an encroachment, the signing may have to be delayed in order to clear the title. Your buyers may not want to or cannot wait for you and render the offer null and void or charge you for cost incurred for the delay in the signing.
Don’t let a out of date certificate make a smooth transaction turn into a nightmare!

**The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.**