Purchasing and selling vacant lands can be complex to navigate. Though not apparent, the extent of due diligence needed in these transactions can be much more than purchase and sale of other commercial properties, primarily due to the land being vacant. Many people may feel since there is no structure and utilities, services on the land, due diligence can be done away with, which is not true.
Factors to be Considered before Purchasing Vacant Land
Vacant lands have a set of diverse legal regulations and factors which need to be considered at the time of closing of the purchase and sale transactions. It is always recommended to consult a Commercial Real Estate Lawyer to make sure that you have taken all the requisite legal steps to complete your transaction.
The Lawyer will help you understand whether the specific vacant land under consideration for purchase meets the desired expectations for the intended use. There can be several factors which affect the vacant land such as future and current municipal plans, surrounding areas around the vacant land and zoning regulations regarding the vacant land.
Professional Environment Testing
Testing of Professional environment is another aspect which needs to be considered. Your Commercial Real Estate Lawyer will guide you in identifying the existence and impact of the environmental concerns on the vacant land such as hazardous wastes remain and underground fuel storage tanks. Doing professional environmental testing will certainly help in clearing all environment and the associated issues before the purchase transaction is completed.
For vacant lands, you will also need to get the searches done from the relevant conservation authorities. Your Real Estate Lawyer will get this done for the vacant land which is under consideration for purchase. It is essential to conduct conservation search for the vacant land and know information from the conservation of the region in which the land is situated. It helps in identifying if the land is part of any conservation project whether planned or existing or any other regulations or restrictions it may be subject to.
Regulated area searches can also be done to make sure that any development on the vacant land is not subject to extreme natural elements like flooding or erosion. It will also help to determine if the development on the land will affect nearby environmental features like wetlands, forests, lakes or beaches. TRCA’s regulated area permit may also be needed if such is the case.
Agreement for Sale & Purchase
Your Commercial Real Estate Lawyer will assist you in determining, negotiating and drafting the terms and conditions of sale and purchase agreements for commercial, industrial and residential properties.
They will support the transaction by drawing up the transfer of land, registering the deeds and determining, making the payment of land transfer tax for vacant lands in Toronto and Ontario.
Additional documents which are to be prepared include the survivorship application or the transmission and the administrator’s or executor’s transfer in those cases where an estate is present in the transaction.
Harmonized Sales Tax (HST)
Sale and purchase transactions of vacant lands are subject to the legal regulations of the province and federal government and HST is payable on them.
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