Canada (CA) Registering a Property

This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has five dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in May 2019.

What the indicators measure

Procedures to legally transfer title on immovable property(number)

• Preregistration procedures (for example, checking for liens,notarizing sales agreement, paying property transfer taxes)
• Registration procedures in the economy’s largest business city.
• Post registration procedures (for example, filling title with municipality)

Time required to complete each procedure (calendar days)

• Does not include time spent gathering information
• Each procedure starts on a separate day — though procedures that can be fully completed online are an exception to this rule
• Procedure is considered completed once final document is received
• No prior contact with officials

Cost required to complete each procedure (% of property value)

• Official costs only (such as administrative fees, duties andtaxes)
• Value Added Tax, Capital Gains Tax and illicit payments are excluded

Quality of land administration index (0–30)

• Reliability of infrastructure index (0–8)
• Transparency of information index (0–6)
• Geographic coverage index (0–8)
• Land dispute resolution index (0–8)
• Equal access to property rights index (-2–0)

Case study assumptions

To make the data comparable across economies, several assumptions about the parties to the transaction, the property and the procedures are used.

The parties (buyer and seller):-

• Are limited liability companies (or the legal equivalent).
• Are located in the peri urban (that is, on the outskirts of the city but still within its official limits)area of the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.
• Are 100% domestically and privately owned.
• Perform general commercial activities.

The property (fully owned by the seller):

• Has a value of 50 times income per capita, which equals the sale price.
• Is fully owned by the seller.
• Has no mortgages attached and has been under the same ownership for the past 10 years.
• Is registered in the land registry or cadastre, or both, and is free of title disputes.
• Is located in a periurban commercial zone (that is, on the outskirts of the city but still within its official limits), and no rezoning is required.
• Consists of land and a building. The land area is 557.4 square meters (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in good condition, has no heating system and complies with all safety standards,building codes and legal requirements. The property, consisting of land and building, will be transferred in its entirety.
• Will not be subject to renovations or additional construction following the purchase.
• Has no trees, natural water sources, natural reserves or historical monuments of any kind.
• Will not be used for special purposes, and no special permits, such as for residential use,industrial plants, waste storage or certain types of agricultural activities, are required.
• Has no occupants, and no other party holds a legal interest in it

Registering Property — Canada

Procedures (number)

5

Time (days)

4

Cost (% of property value)

3.8

Quality of the land administration index (0–30)

21.5

Details — Registering Property in Canada — Procedure, Time and Cost

Procedure 1:.

Obtain tax clearance and utility certificate from the Municipality:

Agency Municipality

The parties must show reasonable evidence to the title insurance company that the property is clear of tax obligations. A written tax clearance certificate should be obtained from the Municipality.It can be obtained online, and the applicant will receive the certificate by email after two business days. The certificate will need to show the latest tax receipts including the amount of current year taxes and whether all taxes are paid to date. Verbal confirmation that real property taxes have been paid will also suffice. To confirm verbally that the real property taxes have been paid, a Tax Certificate must be requested and paid for, and in most cases, it commonly takes more than 1 business day to process. Real property taxes are required to be paid up to the date of the transfer of the property.

At the same time, a utility clearance certificate is obtained online to confirm balance owing on a utility account.

Time to Complete

2 days

Associated Costs

CAD 121.46; (CAD 68.65Tax clearance certificate CAD 52.81 Utility clearance certificate)

Procedure 2:.

Obtain a copy of parcel register and search for writs:

Agency Land registry

A copy of Parcel Register and search for Writs filed against the seller are obtained online through service providers.

Time to Complete

Less than one day, online (Takes place simultaneously with previous procedure)

Associated Costs

CAD 41.13; (CAD 30.05(Parcel Register)CAD 11.80 (Search for Writs))

Procedure 3:.

Obtain a status certificate for the selling corporation:

Agency Provincial government

The buyer’s solicitor obtains a Status Certificate from the provincial government or the federal government.

Time to Complete

1 day (Takes place simultaneously with previous procedure)

Associated Costs

CAD 40; (CAD 26 (the fee of status certificate in case of the province of Ontario)CAD 14 (the service provider fee, the fee differs by providers))

Procedure 4:.

Conduct title search:

Agency: Teraview

Depending on whether the property is located in a jurisdiction governed by the Land Titles Act or the Registry Act or by electronic registration, in the absence of title insurance, a simple title search will cost CAD 2,000, and more difficult searches can cost CAD 10,000 or more.

In terms of additional investigations: (a) an environmental report would cost between CAD 1,500to CAD 3,000; (b) a building inspection would take 10 to 21 days and would cost CAD 2,500 to CAD 10,000; and © a zoning review by a planning consultant would take between 1 day and 14days and would cost between CAD 2,000 and CAD 10,000.

Title insurance can be obtained for CAD 0.75/CAD 1000 of the purchase price if the purchase price is CAD 2,000,000 or more and for CAD 0.80/CAD 1000 of the purchase price if the purchase price is less than CAD 2,000,000.

Time to Complete

2 days (Takes place simultaneously with previous procedure)

Associated Costs

CAD 2,000

Procedure 5:.

Registration of the transfer of title:

Agency: Purchaser’s solicitor or Land registry

After the agreement has been prepared and the transaction closed, the parties’ solicitors will complete the registration for transfer of title. Electronic registration governs more than 90% of properties in Toronto. In the electronic registration regime, the transfer is registered electronically by an authorized licensee at the offices of the purchaser’s solicitor. Only authorized licensees have access to the electronic registration system for security reasons.

The payment of registration fee and the Land Transfer Tax is done electronically if it is in the electronic regime. Solicitor’s fees for their representation in the whole process are estimated at CAD 6,000 (CAD 3,500 for the buyer’s solicitor and CAD 2,500 for the seller’s solicitor). Notification of change of ownership to assessment department and utility companies can be done the same day immediately after closing but should be arranged before closing to ensure continuity of services.

Time to Complete

Less than one day, online

Associated Costs

CAD 111,178.83; (CAD76.55 (electronic registration fee) +Provincial Land Transfer Tax + Municipal Land Transfer Tax + CAD 79.5(Municipal administrative fee)

Provincial Land Transfer Tax is calculated through a progressive scale:

For a property valued under CAD 55,000: 0.5%From CAD 55,000, up to and including CAD250,000: 1.0%From CAD 250,000, up to and including CAD400,000: 1.5%Over CAD 400,000: 2.0%

Municipal Land Transfer Tax for the City of Toronto is calculated through the following scheme plus an administration fee of CAD79.05

For a property valued under CAD 55,000: 0.5%From CAD 55,000, up to and including CAD250,000: 1.0%From CAD 250,000, up to and including CAD400,000: 1.5%Over CAD 400,000: 2.0%)

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