Buy & Sell Recreational Property in Canada. Geraldine Santiago
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the investor only interested in revenue.
You should speak to a qualified agent in the area who can provide you with more details about these types of restrictions and uses.
Ski-in/Ski-out Condominiums
Ski-in/ski-out condominiums mean that you can literally ski in and ski out of the door of your property! It is important to find out whether the property you are purchasing is truly a ski-in/ski-out condominium. Although there are many properties advertised as “ski-in/ski-out,” a ski hill may still be quite a distance from the property.
Sometimes ski resorts have a central ski village where restaurants, pubs, and ski repair shops are located. It may be that the central ski village is located far from the property and that you need to drive to get to the village centre.
If you do purchase a true ski-in/ski-out property, it is a very good investment. If you choose to rent out your property, it is obviously very desirable for vacation skiers; and if you choose to sell, the resale value is very high.
Ski Chalets and Winter Cabins
When purchasing a ski chalet or winter cabin it is most likely that you will be purchasing in a developed area that offers a multitude of activities for the entire family, such as snowboarding, skating, skiing (downhill and cross-country), snowmobiling, ice fishing, and snowshoeing. Consider the location of the property. How close is it to these activities, the ski village, or the lake for ice fishing? How close are the amenities?
There are many “dream homes” in developed ski areas. Many winter cabins are state-of-the-art log cabins that are rainproof and durable as well as eco-friendly. Such winter cabins may also have skylight windows, fireplaces, hot tubs, and many other luxury features.
If you are purchasing in a ski resort, find out what types of security are available for the area, but more specifically for your property. This becomes more of an issue should you be away for extended periods of time. Keep in mind that many ski resort developments offer security patrol for the community. You may also want to ask your agent about road clearing services during heavy winter snowfalls.
Mobile Homes, Mobile-Home Parks, and Land-Lease Communities
Mobile homes, or “rvs,” can be broadly defined as portable residential units that can be transported by a towing device, used as a place to live while travelling or on vacation, but sometimes also as a permanent dwelling. A mobile-home park is a residential area that is composed of two or more mobile homes. A landlord provides the land as well as the services and facilities. A land-lease community is similar to a mobile-home park, except that the homes are more permanent structures.
Provincial tenancy acts (in Ontario it is called the Tenant Protection Act) cover landlord and tenant relations in a mobile-home park or land-lease community only if the tenant owns the dwelling in which he or she lives, and if the dwelling is used as the permanent residence of the occupant. In cases where the mobile home is not the permanent residence, disputes between landlords and tenants can be brought to an independent agency such as the Ontario Rental Housing Tribunal.
Real estate agents are increasingly involved with mobile and land-lease homes as a result of the aging Canadian population as well as pricing advantages that are associated with land leases. In mobile-home parks and land-lease communities, the landlord retains possession of the land, the facilities, and the services designed for the common use and enjoyment of the tenants.
Ask your agent for information regarding land leases if you are considering entering into such an agreement.
Hunting Cabins
Hunting and fishing are specialized sports, and if you are purchasing a hunting cabin for these purposes, there is a lot to find out about the property and all that it has to offer. Find out what type of wildlife and/or fish can be caught nearby. Different areas may have an assortment of wildlife, but may not have exactly the type of wildlife you prefer to hunt. Are there moose, bears, white-tailed deer, grouse, and/or turkey? What is the nearest body or bodies of water, and what kind of fishing is available?
Hunting cabins tend to be more rustic, and the normal comforts of home may or may not be included. Ask to see what exactly is included with the price, such as propane lights, propane tanks, gasoline generators, storage batteries, and so on. Some cabins may even include canoes, motorboats, or camping gear with the purchase price. If they are to be included in the sale, make sure these chattels are added to the purchase and sale agreement.
Ranch and Farm Recreational Homes
Some people are looking to purchase a ranch or farm as a recreational home or hobby farm. This is a very specific enterprise and requires a certain level of experience. You need to consider what type of crops and/or animals can be raised on the land, what is required to maintain them, whether the property’s borders are fenced, what facilities are included, and what the main residence is like. Figure out exactly what you have in mind and speak to a local agent who specializes in this type of property.
Title and Ownership
When you are preparing to buy or sell a recreational property, you need to understand the different types of home ownership and the terminology used in land titles. The following are the most common types:
• Freehold
• Leasehold
• Strata title
• Co-operative
• Co-ownership (includes joint tenancy, tenancy in common, fractional and chapter ownership, timeshares)
Freehold
A freehold interest is the same as ownership of property. The owner of a freehold interest has full use and control of the land and the buildings on it, subject to the rights of the Crown, local land-use bylaws, and any other restrictions in place at the time of purchase.
Leasehold
A leasehold interest means that the building or structure such as a townhouse, apartment, or house is built on government-owned land. That is, only the building or structure and not the land can be bought and owned by individuals, and leasehold fees must be paid. The term leasehold can also apply to single-detached houses on farmland, on First Nations land, and so on.
Leasehold interests are for a defined period of time, and the term can either be fixed or on-going. Frequently they are set for 99 years, in which case there will be no review of the lease rate for the full 99 years. After the term ends, the lease can usually be renewed. If the land lease does not have a fixed term, it will have periodic reviews of the lease rate, which is often done every 33 years.
The sale of a leasehold property differs greatly from the sale of a freehold property because the seller is only selling the improvements (the buildings) on the land, not the land itself. In the case of a 99-year lease, if the previous lessee had lived in a building on the leasehold land for 20 years, the new lessee would purchase the remaining portion of 79 years. The shorter the remaining portion, the less a buyer will pay for the leasehold.
Financing may be a big obstacle for buyers, as many institutions will not finance this type of sale. Ask your agent if he or she can provide a list of financial institutions that are receptive to financing leasehold interests.
Strata title
In strata title, you not only own your unit, but you also share ownership of the common areas of the strata property, such as hallways, garages, and elevators. You share financial responsibility for their maintenance with the other owners of the building, and this is reflected in monthly maintenance fees.
Co-operative
A co-operative