Fighting for Your Best Deal

The tax, which is based on the selling price or on the M.U.C. evaluation of the property whatever is greater. It will be calculated as follows:

Taxation Base:

Taxation Rate:

$0 – $50,000 - 0.5%

$50,000 – $250,000 - 1%

$250,000 – $500,000 - 1.5%

Over $500,000 - 2%

After you have signed the deed of sale at the notary’s office, the municipality will send you an invoice shortly after you have moved into your new home. We are glad to have you, come again!

Example #1 Sales price:  $ 150,000

.005 x $ 50,000 =

$ 250
.01 x $ 100,000 =

$ 1,000

Transfer tax - $ 1,250
 

Example # 2 Sales price:  $ 300,000  

 .005 x $ 50,000 =

$ 250
.01 x $ 200,000 =

$ 2,000
 .015 x $ 50,000 =

$ 750
Transfer tax - $ 3,000
 
Example #3 Sales price Transfer tax
  $ 100,000 $ 750
  $ 150,000 $ 1,250
  $ 200,000 $ 1,750
  $ 250,000 $ 2,250
  $ 300,000 $ 3,000
  $ 350,000 $ 3,750 
 

What is a ''legal warranty''? A person selling movable or immovable property must warrant that the property is free from any defect in title and any latent defects, except those declared before the sale. That is what is generally known as the ''legal warranty'', which has two components, i.e. the warranty of ownership and the warranty of quality. These warranties exist by operation of law, i.e. they do not have to be specified in the contract.

The warranty of ownership

The warranty of ownership assures the buyer that:

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

The warranty of quality

Under the warranty of quality, the 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. The seller is not bound, however, to warrant against defects known to the buyer or a defect that a prudent and diligent buyer could have perceived. This is why it is so important for a buyer to have a prospective purchase inspected by an expert. The fact that the seller is unaware of the defect, or that the defect does not become manifest until after the sale, in no way reduces the warranty. However, if the seller was aware of the defect, his liability would be increased to include, in addition to the reduction in value of the immovable, all other losses sustained by the buyer.

Waiving the legal warranty of quality

The legal warranty may be increased, reduced or even waived upon agreement between the parties to a transaction. Except in rare cases, waiving the warranty of ownership (warranty of title) is never recommended. A more frequent occurrence is the waiving of the warranty of quality, including when an immovable is sold by an estate or following repossession. Under certain circumstances, it may even be a good idea to recommend to a seller to sell without a warranty of quality. This could be the case when selling the property of an elderly person who does not want to worry about a potential recourse for a latent defect on the part of the buyer, a recourse which could be exercised against the person’s estate. The warranty of quality may be waived for the entire property or only on certain components such as the pool or the appliances included in the sale. If the warranty of quality is waived on the entire property, the following clause must be included in the promise to purchase:

''This sale is made without legal warranty of quality, at the buyer’s risk.''

If the exclusion concerns only one or more components, the word ''concerning'' should be added at the end of the clause, followed by a description of the excluded component(s). If the warranty of quality waiver is required by the seller from the very beginning, words to that effect must be included both in the brokerage contract and on the detailed description sheet.

The real estate broker's duty

The real estate broker has a duty to inform the seller and the buyer of the consequences of waiving the warranty of quality. For example, a seller who wishes to sell an immovable without a warranty of quality must know:

that this information must appear on the description sheet and that, depending on the market at the time, this could reduce the level of interest on the part of prospective buyers.

that the warranty waiver may have an impact on the selling price and that it will not protect him from a lawsuit for defects of which he was aware and should have declared.

Declarations by the Seller

To this effect, in the case of a residential immovable containing less than five dwellings including divided or undivided co-ownership, the Declarations by the Seller of the immovable form disclosing any factor that could affect the value of the immovable must be duly completed under the same circumstances as the appropriate Brokerage contract – Sale form. Individuals buying a property without a warranty of quality must be informed that, should they discover a defect of which they were unaware, they will have no recourse against the seller, unless they can demonstrate that the seller acted in bad faith by purposely hiding a defect of which he was aware.

Pre-purchase inspection

Such buyers must also be told that they should have the property inspected in greater depth than the inspection usually done on a property sold with a warranty of quality. Note that the article “Compliance with building inspection rules: this concerns you closely” is a reminder of broker’s inspection responsibilities. Of course, the building inspector hired for this inspection must be notified that the immovable is being sold without legal warranty, so that he may take this into account when doing the inspection. Finally, the buyer should require that the seller provide him with a copy of the Declarations by the Seller of the immovable.

Source Oaciq

According to a press release issued today by the Canada Mortgage and Housing Corporation (CMHC) on the real estate market, almost 80% of properties put up for sale are listed on Centris.ca with a real estate broker. “This figure clearly shows that the vast majority of homeowners recognize the advantages of doing business with a real estate broker for the sale of their home,” said Diane Ménard, Vice-President of the Board of Directors of the Greater Montréal Real Estate Board, which encompasses the majority of real estate brokers in the Montréal Metropolitan Area.

The CMHC data confirms that most consumers are well aware of the tangible benefits they have when they do business with a real estate broker for the sale or purchase of a property.

Increased Visibility for the Property

Consumers who team up with a real estate broker benefit from the increased visibility provided by Centris.ca, the website that contains the largest number of homes for sale in Québec. Consumers also benefit from the strength of a network that is comprised of more than 13,000 real estate brokers across Québec and their pool of buying clients. With a real estate market that currently gives buyers the upper hand in most areas of Greater Montréal, this is a considerable advantage.

Obtaining a Fair Price

By entrusting their property to a real estate broker, consumers benefit from a rigorous market analysis, which allows sellers to obtain a fair price for their property and allows buyers to pay fair market value.

Thanks to the Centris® database, which is reserved exclusively for real estate brokers, these professionals have access to important information such as the property’s history, its prior sales, or promises to purchase that were withdrawn following an inspection. 

Increased Protection and Security

Buyers and sellers also benefit from greater protection during a transaction, as real estate brokers are subject to ethical rules and their work is regulated by the Real Estate Brokerage Act and governed by the Organisme d’autoréglementation du courtage immobilier du Québec(OACIQ).

Real estate brokers are also required to carefully check all of the information indicated in a property’s detailed sheet (room sizes, amount of taxes, etc.). Furthermore, brokers must ensure that the seller’s declaration form is filled in, in which the owner is legally required to disclose everything they know about the property (problems, work done, etc.). 

In terms of protections, all real estate brokers are protected by professional liability insurance with the Fonds d’assurance responsabilité professionnelle du courtage immobilier du Québec (FARCIQ). Subscribing to this insurance is mandatory for brokers and agencies. This represents an additional protection for buyers and sellers who use a real estate broker.