How long can you go without paying Property taxes in Ontario, Canada?

In Ontario, property taxes are a type of tax that is levied on the ownership of property. Property taxes are typically paid to the municipality in which the property is located and are used to fund local services such as schools, hospitals, and roads.

If you own property in Ontario, it is important to be aware of your property tax obligations and to pay your property taxes on time to avoid incurring additional charges and potentially jeopardizing your ownership of the property. So, now the question is how long can you go without paying Property taxes in Ontario, Canada? So, let's find out this.

How long can you go without paying Property taxes in Ontario, Canada?

In Ontario, property taxes are generally due on the last business day of February, June, and October, with the fourth installment due on the last business day of December. If you do not pay your property taxes on time, you may be charged interest and penalties.

Although the specific amount of time that you can go without paying your property taxes will depend on the policies and procedures of your local municipality, but if you go without paying Property taxes for more than 3 years in Ontario, Canada your municipality may also take other actions to collect the unpaid taxes, such as-

- Placing a lien on your property: This means that the municipality has a legal claim on your property and can take steps to sell it in order to recoup the unpaid taxes.

- Selling your property: If you do not pay your property taxes and the municipality places a lien on your property, it may eventually sell the property in order to recoup the unpaid taxes.

Not paying Property Taxes in Ontario, Canada

The specific amount of time that you can go without paying your property taxes will depend on the policies and procedures of your local municipality. But proceedings to sell land by public tender in accordance with the City of Toronto Act, 2006, will start once taxes have been in arrears for at least two years.


Last Updated: 

2023-01-09

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Pre-construction Condos vs. Resale: Which is better investment in GTA, Ontario?

Are you thinking of buying a new home in Greater Toronto Area (GTA), Ontario, or any place in Canada for that matter? **Pre-construction Condo vs Resale: Which should you invest in?** This is a common question that comes to your mind while taking such a big financial decision. We are here to reduce your home buying stress and provide information on the **hot and trending housing topics** in Canada. _"Congratulations on purchasing your new home"_ is a comment many people hope to hear. Owning a property is an achievement and a milestone. However, many people are confused about purchasing **real estate** properties. Should they go for a pre-construction or under-construction property or a resale property? To clarify this situation, **a pre-construction house** (talking of condos here!) is **a house yet to be constructed or undergoing construction**. While **a resale house** is **a property that has been constructed** and buyers can pack in after payments. 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Is Ajax in Ontario (Canada) a Good Place to Live?

Are you thinking of moving to Toronto suburbs? You might have you heard about Ajax, a popular town in Durham region in Ontario. Are you looking for a house, and wondering, **Is Ajax in Ontario, Canada a good and safe place to live?** Let's find out the answer while discussing the pros and cons of living in this area. Ajax (Southern Ontario) ----------------------- Located in the eastern part of the Greater Toronto Area(GTA), **Ajax** has become one of the most-sought for families and millennials. This is not surprising as this [**Toronto suburb area**](https://getnewhouse.ca/blog/10-best-toronto-suburbs-for-families-to-live-and-grow) has experienced the fastest growth over the years. It depicts a true reflection of rich cultural diversity, which makes it a melting pot of different cultures and cuisines. Another plus to it is that it has a lower crime rate than the Ontario average. This alone is enough to make it an appealing place for anyone escaping the hustle bustle of the city for a quieter life in the suburb area. Planning to move to Ajax? Here is a definitive guide containing the pros and cons of living in Ajax to help you make informed decisions. Advantages of Living in Ajax, Ontario ------------------------------------- Let's have a look at some of the advantages of living in Ajax, Ontario: ### 1\. Surround Yourself with Nature If you are looking for a place to get lost in nature, Ajax is the right one. Ajax boasts of picturesque lake with a wealth of green views. For ones, the Greenwood conservative area has beautiful scenery with a mix combo of grasslands, coniferous forests and a number of hiking trails. Whether you want to go hiking, fishing or skiing, this park is enough to get your weekend fun-filled. Moreover, you can decide to take a walk along the Paradise beach and enjoy a lazy afternoon with your family. ### 2\. So much to Enjoy Synonymous with great gaming, horse racing, electronic table games, Ajax is one-stop-shop for all things entertainment. Ajax has been known for its Quarter horse racing since 1969. It hosts Canada's high-ranking quarter race track annually and it's one of the biggest attractions Ajax takes pride in. Aside from that, there is an Ajax casino where you can spend the evening trying your luck and enjoying the whole electronic game. Need a beautiful kids day out? Children can have some adrenaline-pumping games at Endless fun. ###  **3. Appreciate the Arts** Ajax is remarkable for its rich history and culture. You can get immersed in various shows at St Francis centre that houses different varieties of performances, artists throughout the year. Visit one of the gallery spaces to take in the unique, beautiful work of art. Explore the many memorials, and art pieces showcased at the council chambers lobby of town hall. Art enthusiasts have got a lot to enjoy. Also, don't miss to learn [**7 Reasons to Live in Stoney Creek, Ontario, Canada**](https://getnewhouse.ca/blog/reasons-to-live-in-stoney-creek-ontario-canada/) ### **4\. Great Neighbourhoods** Ajax is not just along the side of lake Ontario, there are other great neighbourhood options that have garnered homeowners attention over the years. Duffin Bay, Riverside, Discovery Bay are among the many well-established regions. They feature a wide variety of home styles and prices, amenities, shopping malls and restaurants and many other perks to make your stay a good one. ### **5\. A Safe and Secure Environment** According to areavibes.com, Ajax crime rates are 38 percent lower than the average and it's considered safer than 80 percent of other cities in Canada. This makes it safe and secure for families and individuals to live without fear of becoming victims of crimes. ### **6\. Affordable Real Estate** When compared to other GTA places, Ajax housing and real estate is affordable. 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Whether you have to go shopping, visit plazas, dining out, groceries, you need a car to get you going. Besides, Ajax run on a rudimentary transit system and it isn't as robust as Toronto transit. If you plan to visit any city nearby, there aren't no transit system that runs frequently. It's also a hassle if you stay out late in downtown except you have a car. Hence, ensure you have access to a car in order to have a hassle-free stay in Ajax. Do remember to explore the [**Best 10 Cities to Live in Ontario, Canada**](https://getnewhouse.ca/blog/top-10-best-cities-to-live-in-ontario-canada). Living in Ajax, Ontario (Canada) -------------------------------- Overall, Ajax is a **good place to live** to live with a lot of benefits to avail of. While some love the diversity, arts and culture and praise the housing affordability. Others find the limited transit system a big deal and couldn't cope with the heavy traffic. It all stems down on your needs. Despite the downsides, Ajax still remain many favorites and it's better if you take the plunge and come find out everything it has to offer. Now, whether you are [**renting or buying a house in Ontario (Canada)**](https://getnewhouse.ca/blog/renting-vs-buying-home-canada-better/), the above details will be surely help you. A perfect guide to take an informed decision and ensure you have a successful stay in the town. _After knowing the pros and cons of living in this city, what do you think? Is Ajax, Ontario a good place to live? Do share your views and experiences thereon._

Best Land Loan Options in Canada 2023

For many Canadians, investing in land can be a wise decision because it is said that "Real estate cannot be lost or stolen, nor can it be carried away". Land, whether for private or commercial use, can provide long-term benefits especially places like Canada. As a result nowadays, investment in land is considered as the safest if done with proper research and carefully. However, it is also known that buying land is costly, and many individuals don't have the enough money to buy that so they tend to go for borrowing money from their relatives or loan from the bank. So, if you want to buy land in Canada and thinking to take loan then you must know the various types of loans especially for buying land. There are various types of land loans available in Canada, each of which is designed to allow people to refinance or purchase land there. In this blog, you will explore the different options of land loans available to you, learn about the application cycle, and discover the interest rates associated with each decision. So, let's dive in. ## What is a Land Loan? A land loan is basically a loan for buying land. It looks like a mortgage, but instead of buying a house, you're buying a land piece - could be a farm or just a vacant lot. But here's the one thing: depending on the lender's opinion and how well your finances appear, the land loan might either be secured or unsecured. ## Types of Land Loans in Canada There are different types of land loans available in Canada. The most popular land loans are: ### **1. Raw or Vacant Land Loan** If you want to buy a piece of land but it lacks infrastructure. This is where a raw land loan comes in. This loan type is primarily used to purchase undeveloped land with no plans or infrastructure. However, these loans are difficult to obtain because they carry a higher risk for the lenders because the land is more difficult to sell and conveys no pay. As a result, you'll almost certainly have to pay higher interest rates and make a larger down payment. ### **2. Serviced Land Loan or Lot Loan** A serviced land loan is used to buy land with infrastructure such as electricity, water, and sewer. This type of loan is considered safer by lenders because it has some value and pay generation potential. As a result, serviced land loans may come with lower interest rates and a smaller [down payment requirements](https://getnewhouse.ca/article/how-much-down-payment-expected-for-land-ontario-canada). ### **3. Farm Land Loan or Agricultural Loan** A farm land loan is used to purchase agricultural land, similar to a farm or ranch. This sort of loan is planned specifically for farmers and ranchers, and it can assist them with financing the purchase of farmland, hardware, and livestock. Farm land loans may accompany lower interest rates and down payment prerequisites as they are backed by the value of the farmland and the pay generated by farming. ### **4. Commercial Land Loan** A commercial land loan is considered when we plan to buy land for commercial purposes, for example, building an office or retail space. This type of loan can assist business people with financing the purchase of land and development costs. Commercial land loans may comes with lower interest rates and down payment prerequisites as they are backed by the pay generated by the business. ## How to Qualify for a Land Loan in Canada? Qualifying for a land loan in Canada can be more challenging than qualifying for a mortgage. Lenders consider land loans riskier as they are not backed by a physical plan that can generate pay. To qualify for a land loan, you may have to meet certain prerequisites, including: - **Good Credit Score** Having a good credit score is important while applying for a land loan. Lenders want to guarantee that you have a good track record of paying back obligations on time. - **Adequate Income** Lenders want to see that you have a stable pay and can afford the loan payments. They may anticipate that you should give proof of pay, for example, pay stubs or tax returns. - **Down Payment** Lenders may require a higher down payment for a land loan than a mortgage. A down payment of 20% or more may be supposed to get the loan. - **Land Appraisal** Lenders may require an appraisal of the land to guarantee that it is worth the loan amount. They may also want to know the potential for cash generating activities on the land. - **Collateral** Lenders may require collateral to secure the loan. This could incorporate other property or assets that you own. ## Where to Get a Land Loan in Canada? There are lot of ways and options for getting a land loan in Canada. Yet, the most popular are- ### 1. Banks and Credit Unions In Canada, the most popular options of land loans are banks and credit unions. Banks and credit unions offer a variety of land loan options and generally have explicit and strict requirements for credit scores, down payments, and different criteria that borrowers should meet to qualify for a loan. ### 2. Private Lenders Another choice for land loans in Canada is to work with a private moneylender. Private lenders are individuals or companies that give loans without being part of a traditional financial institution. They typically have less restrictions and can be more adaptable with loan terms, however may charge higher interest rates to reduce the risk. **Note** : While working with a private moneylender, it is important to take care of any outstanding concerns and research the bank to guarantee they are legitimate and reputable. You ought to also carefully audit the loan terms and understand the expenses and interest rates before agreeing to the loan. ## Land Loan Considerations Before taking out a land loan, there are a couple of key considerations to remember, as it's the loan who drags towards the debt trap. So, you must know - - **Purpose of the Land** It is important to think about the reason for the land before taking out a loan. In the event that the land is for personal use or a small leisure activity farm, you may not require as much financing as you would for a large-scale development project. - **Down Payment** Many lenders require a down payment of at least 20% for land loans. This can be a significant amount, so it is important to factor this into your budget while considering a land purchase. - **Interest Rates** Interest rates for land loans can vary generally depends upon the moneylender, the loan term, and your credit history. It is important to look around and compare rates to guarantee you are getting the most ideal deal. - **Loan Terms** Loan terms for land loans can range from a couple of years to several decades. It is important to carefully audit the loan terms and guarantee you understand the repayment plan and any charges associated with the loan. ## Land Loan Options in Canada Land loans can be a great choice for individuals and organizations hoping to purchase land in Canada. Whether you pick a traditional moneylender, a private bank, or a government-backed loan, it is important to carefully think about your options and pick the loan that best fits your requirements. Before taking out a loan, it is important to carefully survey the loan terms, think about the reason for the land, factor in any down payments or charges, and guarantee you are getting the most ideal interest rate. With these factors as a top priority, you can make an informed decision and find the financing you really want to purchase your dream property.

Can US citizen buy property in Canada?

It's not surprising that Canada has a thriving expat community given the vast array of opportunities the country provides. Canada is a great place to live, whether you're looking to explore the great outdoors, relocate to be near family, or seize a fantastic new business opportunity. Therefore, there are many benefits to buying property in Canada, but if you live in the US and want to buy real estate in Canada, you probably have some questions. So today we'll find out if US citizens can buy property in Canada. ## Can US citizen buy property in Canada? In Canada, non-citizens have the same ownership rights as citizens, and foreigners interested in buying real estate are typically welcomed. Therefore, if you are a citizen of the US, you can definitely buy property in Canada. Americans can own property in Canada without establishing residency there, but they must disclose their income or sale proceeds to the tax authorities of both nations. In addition, anyone buying real estate in Canada is required to pay the **Non-Resident Speculation Tax, also known as the Foreign Buyer's Tax**, which is due at closing when a foreign buyer buys a home anywhere in the province of Ontario or in certain areas of British Columbia. This tax is 25% in Ontario and 20% in B.C. ## Understanding Canadian mortgage financing before buying a home In Canada, there are two ways to pay for real estate: with cash or by taking out a loan from a lender. Whichever option you select, the depositing procedure is essentially the same as it is in the United States. It will be necessary to pay a deposit, typically within 24 hours, of the agreed-upon home purchase amount. However, if you intend to finance your purchase through a bank, be aware that you must do so through a Canadian bank and not a U.S. bank. You must provide certain supporting documentation, such as pay stubs proving your income, records of your credit history in the US and Canada (if applicable), and a letter of recommendation from your US bank outlining your financial situation in order to be approved for a mortgage in Canada. ## US citizen can buy property in Canada Foreign nationals have been allowed to purchase property in Canada until recently. But starting in January 2023, non-Canadians will no longer be allowed to purchase residential property for 2 years. However, there are notable exceptions made for permanent residents and temporary residents, such as foreign students and temporary workers. The measures are a part of Bill C-19, the Budget Implementation Act of 2022, which the federal government passed on June 23 in an effort to cool the sweltering housing market.

Why is Immigration good for Canada?

Are you planning to immigrate to Canada? Great News! But, have you ever analyzed, **Why is Immigration good for Canada?** Let's understand why Canada welcomes more people and why it will keep doing so in the coming years. Immigration to Canada --------------------- **Immigration to Canada** has increased since the anti-immigration scandals and policies in the United States. Many immigrants are now choosing Canada as a place to start a new life. These have put the country on the world stage as an alternative place to live their dreams. Canada has always been a country that welcomes immigrants. But the United States' recent approach to immigration has led more immigrants to turn to Canada as an alternative. Why Immigration is good for Canadian Economy? --------------------------------------------- Read on as we explain why immigrants are beneficial to Canada's economy. 1\. Boost the Canadian Economy ------------------------------ The number of people working and paying taxes in every country is often the strength of its economy. Immigrants fill gaps in the labour force, pay taxes, and spend money on goods, housing, and transportation. The money helps in funding the country's public services. Canada needs qualified people to fill in various vacancies across its different provinces. Professionals or investors, whoever comes will be boosting the Canadian economy in one way or the other. 2\. Meet Labour Market Needs ---------------------------- Canada’s labour force has continued to grow every year due to immigrants. If it weren’t for immigrants, employers would have trouble finding enough qualified workers to fill available jobs. This is because Canadians are living longer and having fewer children. More people are also retiring, and there are fewer students in schools. These have limited the Canadian-born potential workers. Moreover, there has been an acute shortage of staff in a number of fields. So, the immigrants coming to Canada will help reduce this gap. 3\. Improve Health and Social services -------------------------------------- Many immigrants in Canada are young and economically active. They contribute more than they receive in benefits over their lifetime. According to reports, more than 335,000 immigrants work in health-related occupations. 20% of people as sports coaches in Canada are immigrants. One-third of people working in scientific research and development services are non-Canadians. Further, immigrant doctors, nurses, other staff, etc. can contribute in improving the stressed healthcare system in the country. However, this is possible after attaining the necessary qualification and experience. 4\. Sustain Canada's Education System ------------------------------------- International students contribute more than $21 billion to the Canadian economy every year. These include student spending and tuition. This is more than Canada’s exports of auto parts and lumber. International education is also an important pillar of Canada’s long-term competitiveness. More than 20% of all students enrolled in maths, computer, and information sciences programs are non-Canadians. Also, 15% of students enrolled in architecture, engineering, and related programs are international students. These expose Canadians to new cultures and ideas. It also stimulates innovation and develops cross-cultural competencies in the country. And, a number of these students stay on work permits or become Permanent Residents and then citizens. So, gradually they become a crucial part of the country's growth. 5\. Improve Trade Ties ---------------------- Many immigrants in Canada are entrepreneurial. They create jobs for Canadians and non-Canadians in all sectors of the country. These include construction, health care, retail trades, professional services, and many more. Immigrants have a desire to import goods from their home countries. They also export more because of their networks in their home countries. These broaden the variety of imports to export Canada, improving trade ties. Why Immigration is important for Canada? ---------------------------------------- Talking specifically, immigration is essential for the progress of a developed country like Canada. Here are the reasons to justify it. 1\. Support Ageing Population ----------------------------- The Canadian government uses the income tax paid by people working in Canada to support retired Canadians. Immigrants working in Canada have helped keep the economy growing and maintain its commitments to retired workers. Without immigrants, younger Canadians would pay more income tax per person. According to reports, 80% of working immigrants are under 45 years. This means they will have plenty of working years. These will also sustain the ageing Canadians 2\. Adjust to Canadian Society ------------------------------ The earnings of immigrants often match those of an average Canadian after a few years. These give them a sense of belonging. Some economic immigrants also catch up much more quickly within their first year. These make them more active in Canadian society, and many of them are members of social organizations. 3\. Real Estate Investment in Canada ------------------------------------ The great thing about investing in real estate in Canada is that it has no shortage of options. You can buy the property and manage it yourself. You can also take a hands-off approach and invest in a fund. Ultimately, you will find a method that fits your budget and schedule. Let’s look at the common ways to invest in real estate to know which ones might be best for you. ### Buy a House When you [**buy a home as new immigrant**](https://getnewhouse.ca/blog/can-new-immigrant-buy-house-in-canada/), you are putting your money in a long-term investment called _equity_. As your home increases in value, your equity increases. Also, you get a tax exemption for capital gain if you live there for most of the year. ### Buy Commercial Properties Investing in commercial property means buying and renting out space where people will work. Commercial property includes malls, shopping centres, industrial complexes, grocery stores, and offices. But it requires a large upfront investment. ### **Rent out Residential Properties** Becoming a landlord is not a bad idea as more Canadians are renting for long periods. As a property investor, you could rent out single-family homes, condos, apartments, duplexes, or even townhouses. These produce extra cash flow, and you could also benefit from the long-term appreciation of your property. **Real estate investment** could be a smart choice as an immigrant in Canada. You can also diversify your investments and create a solid stream of income till your retirement. You may also like to explore [**Best Place in Canada for Indian Immigrants**](https://getnewhouse.ca/blog/which-is-the-best-place-to-live-in-canada-for-indian-immigrants) Immigration in Canada --------------------- To conclude, we can say that immigrants contribute immensely to the Canadian economy. Not only do immigrants to Canada fill in the labour shortage gaps, but play a vital role in the country's progress.

20 Real Estate Terms in Canada - List for Canadian Home Buyers, Sellers & Agents

Are you ready to conquer the Canadian real estate market, but feeling a bit daunted by the abundance of jargon and complexities? Don't worry, you're not alone! The real estate industry can be a minefield to navigate, but with the right knowledge, you'll be able to understand the ins and outs of the market and make informed decisions. So, whether you're a first-time home buyer, a seasoned seller, or a budding real estate agent don't let the jargon hold you back- let's unlock the secrets of the Canadian real estate market with the ultimate 20 real estate terms that you need to navigate the minefield of the Canadian real estate market and come out victorious. ## 20 Real Estate Terms in Canada - A Comprehensive List Knowing real estate terms is key to being a pro in the Canadian market. It's not just for first-time buyers or sellers; it's also for sellers and real estate agents who work here but are unaware of these terms. Because understanding the lingo is what sets you up for success here. For this reason, we have words ranging in complexity from simple words to complex terms. ## **20 Basic Real Estate Terms & Concepts to Know** So buckle up and let's dive in deep into the real estate world. ### **1. Amortization**: The length of time it will take to pay off a mortgage, calculated by dividing the total mortgage amount by the annual mortgage payments. It is the period over which the loan is planned to be paid off, usually in a range of 15-30 years. ### **2. Appraisal**: An evaluation of a property's value by a professional appraiser. Appraisals help to determine the fair market value of a property, which is used to help set a fair price for the property. ### **3. Closing Costs**: The expenses associated with purchasing a property, such as legal fees, land transfer taxes, and home inspection fees. These costs can add up to thousands of dollars and are typically paid at the time of closing. ### **4. Conditional Offer**: An offer to purchase a property that is contingent upon certain conditions being met, such as the successful completion of a home inspection. It means that the offer is made on the condition that certain things happen, such as financing or home inspection. ### **5. Equity**: The difference between the market value of a property and the outstanding balance on the mortgage. It is the portion of the property that the owner fully owns, and it increases over time as the mortgage is paid down and the property increases in value. ### **6. Fixed-Rate Mortgage**: A mortgage with an [interest rate](https://getnewhouse.ca/blog/what-does-higher-interest-mean-for-housing-market-in-canada) that stays the same for the entire term of the loan. It means that the interest rate will not change for the duration of the loan, providing predictability and stability for the borrower. ### **7. Home Inspection**: A comprehensive examination of a property's condition by a professional home inspector. Home inspection is an important step in the home buying process, as it can help identify any potential issues or defects with the property. ### **8. Interest Rate**: The percentage at which the lender charges interest on a mortgage. It is the cost of borrowing money, and it can have a significant impact on the overall cost of the mortgage. ### **9. Land Transfer Tax**: A tax paid by the purchaser when a property is transferred from one owner to another. It is a government tax that is paid on the transfer of property ownership and varies by province. ### **10. Listing Agreement**: A contract between a property owner and a real estate agent that outlines the terms of the agency relationship. It outlines the services that the agent will provide, the length of the agreement, and the commission that will be paid to the agent. Also, know the truth behind a [home listed for 1$ in the [Canadian Housing Market](https://getnewhouse.ca/blog/what-it-means-when-home-listed-for-one-dollar-in-canada). ### **11. Mortgage Broker**: A professional who acts as an intermediary between borrowers and lenders to help them find the best mortgage product. They can help borrowers find the best mortgage rate and product that suits their needs. ### **12. Mortgage Pre-Approval**: A conditional commitment from a lender to provide a mortgage for a certain amount, subject to the buyer meeting certain conditions. It is a letter from a lender that states that you are pre-approved for a mortgage up to a certain amount, subject to certain conditions. ### **13. Multiple Listing Service (MLS)**: [MLS or Multiple Listing Service](https://getnewhouse.ca/article/what-is-mls-in-real-estate-canada) is a database of properties for sale by real estate agents. It is a system used by real estate agents to list properties for sale, and it is a valuable resource for buyers and sellers. ### **14. Power of Sale**: A legal process that allows a lender to sell a property in order to recover unpaid mortgage debt if the borrower defaults on the mortgage. It is a provision in the mortgage agreement that gives the lender the right to sell the property in case of default. ### **15. Property Condition Disclosure Statement**: A document that outlines any known issues or defects with a property. It is a statement provided by the seller that discloses any known issues or defects with the property. ### **16. Real Property Report (RPR)**: A legal document that shows the boundaries, dimensions, and location of a property, as well as any improvements or structures on the property. It is a detailed survey that shows the property's boundaries and any structures or improvements on the property. ### **17. Title Insurance**: Insurance that protects the buyer and the lender against any issues with the property's title or ownership. It protects against any hidden issues with the property's title, such as outstanding liens or encumbrances. ### **18. Underwriting**: The process of evaluating a mortgage application to determine whether to approve the loan and what terms to offer. It is the process used by lenders to evaluate a borrower's creditworthiness and ability to repay the loan. ### **19. Zoning**: Set of regulations established by local governments that determine how land can be used in a particular area, by dividing the municipality into different zones and regulating the development, density and allowed uses of the land. ### **20. Lease**: A lease is a legal agreement between a landlord and tenant outlining the terms and conditions of renting a property, including the rental amount, length of the lease and responsibilities of both parties. ## **20 Advanced Real Estate Terms & Concepts to Know** Now, let's get an idea on some of the advance terms used in the real estate industry. ## **1. ‘As Is’ clause** Let's learn about this real estate concept from both a seller's and a buyer's point of view. #### **For sellers** "As-Is" clause means property is sold in current condition, with no promises or guarantees from the seller. - It can be a quick and cost-effective option for sellers. - But, it also means that the buyer will have to take on any necessary repairs or renovations. - Legally required to disclose all issues with the property, including providing a detailed statement of condition, prepared by a professional, and based on an inspection. #### **For buyers** "As-Is" properties may come at a lower price, but they can also end up costing more if extensive repairs are needed. - It's crucial to do a thorough inspection of the property to reveal any potential issues. - Consider including a "subject to inspection" clause in the contract, which allows the buyer to back out if the inspection reveals more problems than initially disclosed by the seller. - Important to proceed with caution and have a solid team of professionals, including a real estate agent, home inspector, and attorney, to minimize the risk. For more details, refer [What does As-is clause mean in real estate?](https://getnewhouse.ca/article/what-does-as-is-where-clause-mean-real-estate-canada) ### **2. POA (Power of Attorney)** POA is a legal document that allows you to give authority to another trustworthy person(s) to manage your property or money on your behalf. - The person you appoint is called your attorney, and they do not have to be a lawyer. - It is required that a person be ‘mentally capable’ at the time of signing a POA for it to be valid. - Laws, requirements, and definitions of POA vary across provinces and territories in Canada. - Real Estate and POA In real estate, your attorney can manage buying or selling of real estate in your name, pay bills on your behalf, and even collect money owed to you, unless restricted to do so. Your attorney does not become the owner of your property, they can only manage it on your behalf. ### Types of POA - **General Power of attorney**: Allows your attorney to manage all or part of your finances and property only while you are mentally capable of managing your own affairs. Becomes invalid if you become mentally incapable. Can be limited to a particular task or time period. - **Continuing power of attorney**: Allows your attorney to continue managing your finances and property even if you become mentally incapable to do so. Can start immediately or come into effect when you become mentally incapable. ### **3. MLS (Multiple Listing Service)** MLS (Multiple Listing Service) is a database of properties for sale or rent, maintained by real estate agents and brokers. - It allows agents to share information about properties with other agents in their area, increasing the chances of a sale or lease. - MLS data is only available to real estate agents and brokers who are members of the service. - It includes detailed information about properties, including photographs, prices, and descriptions. - MLS can be a powerful tool for buyers, sellers, and real estate professionals to find and market properties. ### **4. CCIM (Certified commercial investment member)** CCIM (Certified Commercial Investment Member) is a professional designation for commercial real estate professionals. - It is awarded by the CCIM Institute after completing education and demonstrating experience. - Recognized as mark of expertise in commercial and investment real estate. - Only held by a select group of professionals. - CCIMs are trained to analyze investment opportunities. ### **5. CPM (Certified Property Manager)** CPM (Certified Property Manager) is a professional designation for property management professionals. - It is awarded by the Institute of Real Estate Management (IREM) after individuals complete a rigorous education curriculum and demonstrate their experience in property management. - The CPM designation is recognized as a mark of expertise in the property management industry. - Only held by a select group of professionals. - CPMs are trained to manage and maintain properties effectively and efficiently. ### **6. CMA (Comparative Market Analysis)** CMA (Comparative Market Analysis) is a report that compares a property to similar properties in the same area. - It is used to determine a property's estimated value, and to help with pricing decisions when buying or selling a property. - A CMA includes information about recent sales and current listings of similar properties. - It also includes information about market trends, such as average days on market and sale-to-list price ratios. - CMA is a helpful tool for both sellers and buyers to have a better understanding of the market and make informed decisions. ### **7. CRE (Commercial Real Estate)** CRE (Commercial Real Estate) refers to properties used for business or investment purposes. - It includes properties such as office buildings, retail centers, industrial warehouses, and multifamily apartments. - CRE transactions are generally more complex and involve more money compared to residential real estate transactions. - CRE professionals such as brokers, investors, and property managers have specialized knowledge and skills to navigate the market. - CRE can also include special purpose properties such as hotels, hospitals, and self-storage facilities. ### **8. CAC (Central Air-Conditioning)** CAC (Central Air-Conditioning) is a type of air conditioning system that cools a building or home by circulating chilled air through ductwork. - It typically uses a central unit, such as a furnace, to cool the air and distribute it throughout the building. - CAC systems are often more efficient and can cool larger areas compared to individual room air conditioners. - It can also improve air quality by filtering and circulating air throughout the building. - CAC systems require regular maintenance to ensure they are functioning properly and efficiently. ### **9. COI (Certificate of Insurance)** A Certificate of Insurance (COI) is a document that verifies that a specific insurance policy is in effect and provides details on the coverage provided. - COIs are typically issued by insurance companies or their agents and are used to provide proof of insurance to third parties, such as lenders or landlords. - COI includes: insured name, policy number, coverage type/limits, and insurance company/agent contact information. - Some COIs may also include additional information, such as endorsements or exclusions to the policy. - COIs are not the same as the insurance policy itself and do not provide all of the terms, conditions, and exclusions of the policy. ### **10. CMHC (Canada Mortgage and Housing Corporation)** Canada Mortgage and Housing Corporation (CMHC) is a Crown corporation of the Government of Canada. - Its primary function is to provide mortgage loan insurance to Canadian banks and other lending institutions. - This insurance helps protect lenders against losses if a borrower defaults on a mortgage loan. - CMHC also conducts research and provides information on housing markets and trends, as well as housing-related programs and services. - CMHC is funded by premiums paid by borrowers who take out mortgage loans that are insured by the corporation. ### **11. CMA (Comparative Market Analysis)** A [Comparative Market Analysis (CMA)](https://getnewhouse.ca/article/what-is-cma-in-real-estate-canada) is a report that compares a property to similar properties that have recently sold or are currently on the market. - It is used by real estate agents, appraisers, and homeowners to estimate the fair market value of a property. - A CMA typically includes information such as the property's location, size, condition, and features as well as information on comparable properties, including their sale prices and other relevant details. - It is based on recent sales data, it helps in determining the current market value of a property - It is used to set the price for a property that is for sale or to be appraised. - A CMA can also be used to evaluate the potential return on investment for a rental property or a fix and flip investment. ### **12. ARV (After Repair Value)** After Repair Value (ARV) is a term used in real estate investing to refer to the estimated market value of a property after any necessary repairs or renovations have been completed - It is used to determine the potential profitability of a fix-and-flip investment or the maximum purchase price for a property being considered for a rental or rehab project. - ARV is calculated by taking the estimated market value of a property in its current condition, subtracting the cost of repairs and renovations, and then adding any potential value-adds such as an addition or a finished basement. - It is an estimate of the potential of the property in the future after the repairs are done - It helps in determining the maximum amount to be spent on the renovation and property purchase, so it doesn't exceed the potential value of the property after renovation. ### **13. LTV (Loan to Value)** Loan-to-value (LTV) is a ratio used in the mortgage industry to indicate the size of a loan compared to the value of the property being used as collateral. - It is calculated by dividing the loan amount by the value of the property. - It is used by lenders to determine the risk of a loan and the creditworthiness of a borrower. - A higher LTV ratio indicates a higher risk to the lender, as the borrower has less equity in the property. - LTV is used to determine the minimum down payment, interest rate, and maximum loan amount - Lenders usually have different LTV ratios for different types of properties and loans. - A high LTV ratio may require a higher interest rate or mortgage insurance. ### **14. Cap Rate** The Capitalization Rate, or Cap Rate, is a measure used in real estate investing to indicate the rate of return on a property based on its income and purchase price. - It is calculated by dividing the property's net operating income by its current market value or purchase price. - Cap Rate is a metric used to compare the potential returns of different properties. - A higher cap rate indicates a higher return on investment, and a lower cap rate indicates a lower return. - Cap rate is used to evaluate the performance of a property and its potential as an investment. - Cap rate can be used to compare the yields of different properties and areas, even though it is a ratio, it does not take into account the cost of debt. ### **15. GDS (Gross Debt Service)** Gross Debt Service (GDS) ratio is a measure used by mortgage lenders to determine a borrower's ability to afford the mortgage payments on a property. - It is calculated by dividing the total mortgage payments, including principal, interest, property taxes, and heating costs, by the borrower's gross income. - GDS is one of the two ratios used to qualify borrowers, the other being TDS (Total Debt Service). - It is used to evaluate the borrower's ability to meet the housing cost, it is usually expressed as a percentage. - Lenders usually have a maximum GDS ratio, typically between 31% and 39% - A high GDS ratio may indicate that a borrower is over-extended and may have difficulty making mortgage payments. - A low GDS ratio may indicate that a borrower has a lower risk of defaulting on the loan. ### **16. TDS (Total Debt Service)** Total Debt Service (TDS) ratio is a measure used by mortgage lenders to determine a borrower's overall ability to afford the mortgage payments on a property, as well as their other debts and expenses. - It is calculated by dividing the total monthly debt payments, including mortgage payments, credit card payments, car loans, and any other debts, by the borrower's gross income. - TDS is one of the two ratios used to qualify borrowers, the other being GDS (Gross Debt Service). - Lenders usually have a maximum TDS ratio, typically between 42% and 44% - A high TDS ratio may indicate that a borrower is over-extended and may have difficulty making mortgage payments and other debts. - A low TDS ratio may indicate that a borrower has a lower risk of defaulting on the loan and other debts. ### **17. JT (Joint Tenancy)** Joint Tenancy is a type of co-ownership of property where two or more individuals own the property together. - Each owner holds an equal and undivided interest in the property. - Joint tenants have the right of survivorship, meaning that if one of the owners passes away, their interest in the property passes automatically to the remaining owners. - In a joint tenancy, all parties have equal rights and responsibilities on the property - Each joint tenant has the right to use the entire property. - All the parties need to agree to sell the property or make any changes to it. - In case of death, the share of the deceased tenant automatically goes to the surviving tenant/s. ### **18. TIC (Tenancy in Common)** Tenancy in Common (TIC) is a type of co-ownership of property where two or more individuals own the property together, but each has a distinct and separate share of the property. - No right of survivorship, meaning if one owner dies, their share does not automatically pass to the remaining owners. - Allows multiple parties to invest in real estate together or pass assets onto beneficiaries. - Each tenant owns a specific percentage of the property and can sell or dispose of their share. - Tenants have right to use entire property, but cannot sell or make changes without agreement of other tenants. - In case of death, share is passed on according to will or testamentary disposition, not automatically to surviving tenants. - Different from Joint Tenancy which has equal shares and right of survivorship. ### **19. Lien** - A lien is a legal claim on a property that gives a lender or other creditor the right to seize the property if the borrower or property owner fails to fulfill their obligation. - Liens can be placed on property for unpaid debts, taxes, or other financial obligations. - Liens can be either voluntary, such as a mortgage, or involuntary, such as a judgment lien. - Liens are recorded in the public records, this means that they are visible to anyone who searches. the records. - When the property is sold, the lien must be paid off before the sale can be completed. - If the lien is not paid off the property may be foreclosed or seized by the creditor. ### **20. Ontario Agreement of Purchase and Sale** The Agreement of Purchase and Sale (APS) is a legally binding contract between a buyer and a seller for the purchase of a property in the province of Ontario, Canada. - Outlines terms and conditions including purchase price, closing date, and contingencies. - Prepared by a real estate agent or lawyer, reviewed and signed by both parties, and a copy provided to each. - Includes schedule of chattels and fixtures, closing date, and contingencies, if any. - Legally binding contract, both parties have legal obligations and rights related to the sale. - Buyer typically pays deposit held in trust until closing. - Starting point for completion of sale transaction and ownership transfer. ## Knowing the Canadian Real Estate Concepts The understanding of the real estate terms specific to Canada is essential for home buyers, sellers and agents in order to navigate the market and make informed decisions. Being familiar with terms such as CMHC, ARV, LTV, Cap Rate, GDS, TDS, JT, TIC, CMA, APS, and others, can help you understand the mortgage process, evaluate properties, and negotiate the terms of a sale. Whether you're a [first-time home buyer](https://getnewhouse.ca/blog/renting-vs-buying-home-canada-better), an experienced investor, or a real estate agent, having a solid understanding of these terms will help you make the most of the Canadian real estate market. Did we miss any important term here? Do you wish to include any other interesting concept on real estate in Canada, do comment and share your views.

Do you pay Land Transfer Tax (LTT) when buying vacant land in Ontario, Canada?

People purchasing real estate in Canada, face a significant financial burden from the land transfer tax. When you buy land in Canada, you are required to pay a tax to the government or the municipality. The tax you pay is determined by the property's value, which is influenced by the type of land, and can differ significantly between the provinces where you are buying the land. So, today we'll find out if buying vacant land in Ontario, Canada, is subject to Land Transfer Tax (LTT) or exempt from LTT. ## Do you pay Land Transfer Tax (LTT) when buying vacant land in Ontario, Canada? Yes, you are required to pay Land Transfer Tax on any vacant land that you buy in Ontario. The taxes you pay on vacant land may be a bit different from the taxes you pay for other types of land. The amount of property tax you actually pay will depend on a number of factors, including the assessed value of your property, how it is used, and the applicable municipal tax rate. Usually LTT on vacant land is calculated on the value of the property at the time of sale. But if you have a construction contract related to the purchase of the land, your transfer tax will be computed using the value of the land plus the value of the construction contract. However, It is important to know that in Ontario, you will also be required to pay a municipal land transfer tax in addition to the provincial tax, that means doubling the amount of your final tax payment. ## Who pays Land Transfer Tax in Ontario, Canada? The land transfer tax is the responsibility of the home buyer, not the home seller. When buying a home in Ontario, buyers should factor in the land transfer tax as one of their closing costs. These costs may also include the cost of getting a mortgage. Other closing costs for buyers include legal fees, registration fees, and home inspection fees, though land transfer tax makes up the majority of these. ## Land Transfer Tax when buying vacant land in Ontario, Canada The vacant land is also subjected to Land Transfer Tax, which is calculated on the value of the property at the time of sale. However, a lot of other factors also influence the final tax, so one must conduct adequate research before buying real estate in Ontario.

Do I have to pay sales tax when buying land in Ontario, Canada?

Are you planning to own property in Canada? This can surely turn out to be a profitable venture if you grab information on the Canadian tax laws that are applicable to real estate investments. Canada has regionally different property taxes. However, there are times when many people are aware of taxes but are unsure whether a certain tax is paid when buying or selling or if it is paid by the buyer or seller. Since sales tax is also a similar tax about which many people still have confusion, in order to clear that up today, we'll see if sales tax is paid when buying a property in Ontario, Canada. We will understand this from the point of view of a Buyer. ## Do I have to pay sales tax when buying land in Ontario, Canada? **No, you don't have to pay the sales tax when buying property in Ontario, Canada**. Sales taxes are paid after the selling of the property and comes up in different forms like Provincial Sales Taxes (PST) . But, this does not mean that you will be exempt from paying taxes on land purchases. If you are buying land in Ontario, you will have to pay the land transfer tax, which is collected by the province. Moreover, if you are buying land in a city like Toronto, you will also be required to pay a municipal land transfer tax in addition to the provincial tax in Ontario, which will ultimately result in you paying twice as much. Let's imagine that if you were to purchase an $800,000 home in Toronto, you would be required to pay both Ontario's Provincial Tax and the City's Municipal Land Transfer Tax, effectively doubling the cost. You will pay a total of $16,950, which includes $8,475 for the provincial portion and an additional $8,475 for the municipal portion. However, if you're a first-time home buyer in Toronto who meets the requirements, you might be entitled to a rebate of up to $8,475, leaving you to pay $8,475 in total land transfer tax. ## No Sales Tax when buying land in Ontario, Canada There is no sales tax applied when someone buys property in Ontario, Canada. However, if you are not a first-time buyer, you will also be required to pay a municipal land transfer tax, which doubles your tax.

Can a non-resident get a mortgage to purchase a house in Canada?

The Canadian real estate market is open to both residents of Canada and non-citizens who reside abroad. There are no restrictions on the kind or quantity of real estate that may be bought in Canada. As a result, a lot of people are interested in buying real estate in Canada but are unable to do so due to a lack of available funds because buying a home or piece of property can be very expensive. Therefore, the majority of people require bank financing or a mortgage in order to buy a piece of land or a house. So, today will determine whether a non-resident can get a mortgage to buy a home in Canada or not. ## Can a non-resident get a mortgage to buy a house in Canada? Yes, non-residents who want to purchase a home in Canada can apply for a mortgage there. Although the interest rates are very similar, Canadian banks frequently demand a larger down payment from non-residents than they do from residents. A **minimum of 35% of the home's value is typically required as a down payment** but these requirements may differ from bank to bank, with some being stricter than others. However, in addition to the down payment, non-residents will often have to show the following as well: - Employment verification letter (including income verification) - Bank statements as proof of deposit(at least three months) - Six months of financial statements or an international credit bureau report - A Canadian bank account from which mortgage payments can be made. There are several other lenders that offer mortgages. These lenders can offer a mortgage of up to 65% of the property’s value. You will also need a reference letter from your bank, bank statements for the previous three months, credit information, and tax returns to prove your ability to pay the mortgage. Additionally, these different lenders may offer comparable products with different interest rates and terms. To make sure you're getting the best mortgage product for your needs, speak with several lenders. Canada has substantial expat communities as well as many foreigners that visit for vacations, employment, or study for a short time. Anyone can purchase real estate in Canada, whether they are a citizen, a resident, or a non-resident. This means that you will be able to purchase land in Canada even if you are a non-resident who resides permanently in another nation. But a frequent query that many individuals have is whether they must travel to Canada in order to purchase real estate while they are non-residents. So today we'll find out if you have to be physically present in Canada to purchase a property or not. ## Being a Non-resident, do I need to come to Canada to buy a property? There are no restrictions on non-resident investors buying real estate or businesses in Canada. You are thus free to buy houses, businesses, commercial properties, or agricultural land. There is no requirement for residency or even physical presence in Canada. You can, in fact, look for properties online from anywhere in the world, work with an agent to do so, and even make a purchase. However, you will need to travel to Canada at least twice if you want to buy a property there. The first time is to open a Canadian bank account so you can get Canadian financing. The second time is to sign all of the necessary paperwork. Foreign homebuyers are not permitted to grant powers of attorney for the purpose of remotely signing real estate documents. **Important:** Until recently, anyone could purchase real estate in Canada. But, after the introduction of Foreign Home Buyer Ban effective from January 2023 any non-permanent residents and non-citizens won't be allowed to purchase residential property for a period of 2 years. ## Do you need to come to Canada to buy a property? You can virtually anywhere in the world see a property online or by working with an agent to do so, and even make a purchase. However, there are specific phases of this process where you'll need to visit Canada, such as when you have to open a bank account, which, as we previously stated, is required for the purchase of real estate. ## Non-resident can get a mortgage to purchase a house in Canada Yes, non-residents can get a mortgage in Canada to finance the purchase of a home in Canada. And as far as mortgage interest rates go, both Canadians and non-residents are subject to the same rates as long as they meet the requirements for mortgage eligibility.

Do I have to pay property tax on vacant land in Ontario, Canada?

Vacant land is the best choice for people looking to purchase land in Ontario to build their future home, for commercial use, or as an investment. Buying vacant land is exciting because there is more room for development, and it is always less expensive. However, if you also own vacant land in Ontario and wondering if you are required to pay property tax on vacant land or not, then relax; you have come to the right place. So, to clear your question, let's find this! ## Do I have to pay property tax on vacant land in Ontario, Canada? Property taxes are one way that local governments generate revenue. Local governments levy this tax on owners of real estate in the residential, commercial, and industrial sectors. **So, similar to any other type of real estate ownership, you usually need to pay property taxes on vacant land that you own.** The actual property tax will be determined by a number of elements, such as the property's assessed value, its intended use, and the municipal tax rate in Ontario. This tax mostly depends on the size and location of the property because vacant land doesn't have any buildings or development to add significantly to the value. This percentage includes both the municipal rate and, if applicable, a provincial education tax rate and is set by the municipality in which your property is located. ## Does vacant land have a higher property tax? No, the property tax on vacant land is comparatively lower. Because municipalities levy property taxes to cover the costs of providing services to properties, such as utilities, road maintenance, garbage disposal, policing, fire services, and more. As vacant land uses the city's services much less frequently, it may be subject to lower taxes. But it also depends on the land's intended zoning. For instance, vacant residential land is taxed at the same rate as other residential properties in the City of Toronto, while vacant commercial or industrial land is taxed at a 30% discount from the full rate that applies. ## Property tax on vacant land in Ontario, Canada Vacant land is also subjected to property tax in Ontario, Canada. However, if you want to calculate how much property tax you might owe, be sure to find the right tax rate for your municipality and property type or speak with a tax expert. Online property tax calculators will likely use the residential rate, which might not be the correct rate for your property.

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