Title, Land, Land Use Controls: Planning/Zoning/Taxation

Title, Land, Land Use Controls: Planning/Zoning/Taxation Barbara Grodaes CoolThings2No

Things You NEED to Know • Understanding is critical to success! • Responsibility to client is to be ABLE to provide the information (direct client to expert) • You want to provide the best service to both buyers and seller CoolThings2No

Real Estate • Both a market and a commodity As a commodity… the physical land and improvements made to it, including structures erected thereon. CoolThings2No

Real Property • Comprises of 2 elements • Tangible physical, touchable • Intangible bundle of rights CoolThings2No

Limitations to Ownership Rights • Power of taxation • Power of eminent domain (expropriate) • Police power • Power of escheat (Crown) • Restrictive covenants (running with land) CoolThings2No

Personal Property • Ease of mobility differentiates personal property from real property (unattached goods) CoolThings2No

Ownership of Land Land owners have 3 types of ownership ‘interest in land’ : • Fee simple (subject only to restrictions by the government) • Life estate (exclusive use of property for the term of one’s life) • Leasehold estate (limited time ownership according to lease period CoolThings2No

Forms of Ownership Difference is what happens upon death of one party that is on title • Joint tenancy (right of survivorship) • Tenancy in common (equal or unequal undivided interest – ownership transfers to dead party’s estate) CoolThings2No

Other Types of Ownership • Duplexes (multi-family units) – party wall agreement registered on title • Condominiums – unit is fee simple • Cooperatives – unit is leased long-term and owners are shareholders Note: townhouse is a type of structure and not a type of ownership (condo) CoolThings2No

Bundle of Rights With fee simple ownership, comes a bundle of rights including: • To enter and use • To lease • To give away • To sell • To refrain from doing any of these CoolThings2No

Restrictions on Ownership Legal instruments called encumbrances registered against the title can be: • Lien (such as Builders’ Lien) • Easement (dominant/servient tenement) • Restrictive covenant • Mortgage • Lease CoolThings2No

Torrens System Alberta Land Titles System (1+1+1) 1 one piece of paper +1 one piece of property +1 located in one place (North or South Alberta Land Titles Office – Edmonton or Calgary) CoolThings2No

3 Principles of Torrens System • Curtain – must be registered to be effective • Mirror – WYSIWYG what you see is what you get • Insurance – Assurance Fund created to pay for any errors caused by the Land Titles Office CoolThings2No

Legal Land Descriptions • Meridians north/south W4, W5 and W6 are meridians in Alberta • Ranges north/south every 6 miles starting at meridian line • Townships east/west located 6 miles apart • Sections –land measurement 1x1 mile (640 acres) (correction lines for earth curvature) • LSDs (legal subdivisions) divide sections in 16 (40 acres) generally used for oil industry CoolThings2No

Municipal Government Act • Provides legislative basis to determine how property may be used • Province divided into municipalities (city, town, village, summer village, municipal district) • Required to pass a Land Use Bylaw which develops plan policies (critical for Realtors to know) CoolThings2No

Land Use Bylaw (Zoning) Will generally contain: • Section for administrative matters • General rules applicable to all land use classes • Detailed land use classes and subclasses CoolThings2No

Land Use Control Methods • Zoning Control – specifies every aspect of how property may be used • Development Control – allows each proposed development to be considered according to its own merits CoolThings2No

4 Kinds of Land Use Districts • Residential (R) • Commercial (C) • Industrial (I) • Special – catch-all for special needs For each land use classification the bylaw lists a number of “permitted uses” or “discretionary uses”, or both. CoolThings2No

Permitted Versus Discretionary • Permitted are uses that entitle applicant to a permit as of right if the development conforms with the bylaw • Discretionary are uses that are deemed to be generally appropriate but not necessarily compatible with the surrounding (may/may not be approved) CoolThings2No

Permits • Development permit – document issued under the bylaw authorizing development • Building permit – document issued and required for the actual construction CoolThings2No

Illegal/Non-Conforming Uses • Illegal use of a property (not allowed under the Land Use Bylaw) may require change or removal • Non-conforming use (not allowed under the current bylaw but was okay at the time in came into use – note: if discontinued for more than 6 months, the use must stop ) CoolThings2No

Real Property Report (RPR) • Shows legal outline of the property and the location of all buildings on the land • More detailed than Survey Certificate because it includes fences, trees, roof overhangs, etc. • Requires Certificate of Compliance from the municipality CoolThings2No

Municipal Taxation • Property Taxes = Assessed Value (land and buildings) x Mill Rate • A “mill” is one one-thousandth of a dollar CoolThings2No

Property Tax Adjustments • Taxes for full calendar year (Jan to Dec) but must be paid June 30 • Who gets tax credit? Buyer before June 30 Seller after June 30 • Closing day is ALWAYS seller’s day CoolThings2No

Other User Fees Other fees may affect closing costs: • Recreational Levies • School Taxes (included in Property Tax) • Local Improvement Levies • Legal fees and disbursements • Application fees (if applicable) • Fire Insurance fees CoolThings2No

Summary • Know how to locate rural locations • Verify actual land use and zoning • Advise of property tax adjustment to be expected at closing • Advise of need for Real Property Report • Advise of extra costs that can be anticipated • Err on the side of caution CoolThings2No

Title, Land, Land Use Controls: Planning/Zoning/Taxation