top of page

The Legal Process of Buying & Selling Homes

Selling Your Home The first thing to consider when selling your home is whether you want to sell with an agent or privately. A real estate agent can help you find a prospective purchaser, assist with negotiations between you and the buyer, and advise you of potential issues. Be aware that agents charge a commission for their assistance in selling your home. If a buyer is interested in your home, they will typically submit a Purchase & Sale Agreement. If you are selling your home through an agent, the prospective buyer’s agent will submit their Purchase & Sale Agreement to your agent to review with you. If you are listing your home privately, the buyer’s lawyer will likely draft their own Purchase & Sale Agreement and send it to your lawyer to review with you. The Agreement of Purchase and Sale will set out certain information such as the purchase price, deposit and closing date. The agreement will also typically be conditional on the buyer reviewing or obtaining the following: - Home inspection - Water test - Septic examination - Home insurance - Financing - Survey plan, if available - Lawyer review These conditions must be met by the condition date. If the buyer is not satisfied with one or more of the above conditions by the condition date, they may be able to terminate the agreement and have their deposit returned. It is important to speak to your lawyer within the specified time frame of the lawyer review clause so they can review the agreement with you. It is a good idea to have your lawyer review the offer to purchase before your condition dates expire to ensure it properly meets your needs. On the closing date, your lawyer will ensure several things such as: - That the property is migrated - Any mortgages owing on the property are paid in full and releases are obtained - Any leased items are transferred or paid out - Real estate commissions are paid - Tax considerations You should discuss tax implications with your lawyer before selling property particularly if it is not your principal residence (such as a cottage), or if you have subdivided the land into more than two pieces.

Buying a Home The first thing to consider when buying your home is whether you are buying through a real estate agent or from a private seller. If you are buying a home through an agent, the agent will draft and review a Purchase & Sale Agreement and submit it to the seller’s agent. If you are buying a home privately, your lawyer would typically draft and review a Purchase & Sale Agreement and then submit it to the seller’s lawyer. The Purchase & Sale Agreement will set out certain information such as the purchase price, deposit and closing date. The agreement will also typically be conditional on you reviewing or obtaining the following: - Home inspection - Water test - Septic examination - Home insurance - Financing - Survey plan, if available - Lawyer review These conditions must be met by the condition date. If you are not satisfied with one or more of the above conditions by the condition date, you may be able to terminate the agreement and have the deposit returned. It is important to speak to your lawyer within the specified time frame of the lawyer review clause so they can review the agreement with you. It is a good idea to have your lawyer review the offer to purchase before your condition dates expire to ensure it properly meets your needs. If you are buying a property with financing, you will require a title insurance policy for your lender. Your lawyer can provide you with more information about coverage and the cost of a title insurance policy. Some of the benefits a title insurance policy offers include: - Protection against survey problems (e.g. boundaries, encroachments and undisclosed rights of way) - Protection against building by-laws and zoning infractions; - A duty to defend you against title-related lawsuits. Almost all municipalities in the province have a Deed Transfer Tax. This is a tax paid by the buyer on the closing date. Every municipality in Yarmouth County charges one percent (1.00%) of the total purchase price of the property. On the closing date, your lawyer will ensure several things such as: - That the property is migrated - Any mortgages owing on the property are paid in full and releases are obtained - Any leased items are transferred or paid out - Real estate commissions are paid - Tax considerations


Property Migration Effective March 1, 2005, every county in Nova Scotia is subject to the new Land Registration System. Every property in the province will eventually have to be migrated. Migration of your property is mandatory before one of the following happens: - You sell your property - You mortgage or re-finance your property - You subdivide your property (in some cases) Whether the property is migrated is something you should consider when buying or selling a property, as it may take additional time for the lawyer to complete before the closing date. Under the old system, a title search was conducted each time the property was sold. After the property is migrated, the property does not need to be migrated again and the 40+ year title search is no longer necessary. Migrating your property guarantees that the registered owners of are the legal owners. Your lawyer searches the title of your property going back a minimum of 40 years, searching for all relevant deeds, mortgages, easements and subdivisions. It is important to note that migration gives you no guarantees as to your boundaries. The only way to be certain about the boundaries of your property is to contact a surveyor and have the property surveyed. Many properties in Nova Scotia are sold with no formal survey having been done. In addition to the practical benefits of migrating your property, the other main reason for migration is to clear up any title issues on your property, including adverse possession or “squatters’ rights”, which are typically cancelled out by migration and cannot continue or begin after a property is migrated. The cost of migration is typically the seller’s responsibility unless another arrangement is negotiated between the parties. If you have any questions about migration or wish to migrate your property, please call our office at (902) 749-1995 or email us at info@yarmouthlaw.ca to set up a meeting with one of our lawyers. Tax Considerations A sale of real property can be subject to either HST or capital gains tax, and potentially both. You should discuss tax implications with your lawyer before selling property particularly if it is not your principal residence (such as a cottage), or if you have subdivided the land into more than two pieces. If you are a non-resident of Canada, you will also be subject to holdbacks and are required to obtain a clearance certificate from the Canada Revenue Agency, ensuring that all applicable capital gains tax is paid.


Disclaimer: This article is not intended to contain legal advice specific to your situation. Your use of this article should be reviewed with your legal adviser.

bottom of page