In this article i will discuss a brief explanation of exactly what is involved in buying land “off the plan” and some of the issues you need to consider as it is very different to buying an existing home. GIS Consultant Canada
What does “off the plan” mean?
Buying land “off the plan” means that you are buying a lot which is part of any larger piece of land for which the master plan of subdivision to create smaller lots has not yet been registered.
Right up until the plan of neighborhood is registered, the land you have bought will not have a distinct title and until each lot is allocated with a separate title, your acquiring the land are unable to be completed and you are usually not required through your Contract to pay balance of purchase price.
Your Contract will normally provide that the arrangement (or final payment of the purchase price) will be due within 13 days of notification of registration of the master plan of subdivision and will usually further provide that the seller has a time frame by which to sign-up the plan, normally this era will be six months but could be longer.
The seller has many items to go to to in finalizing the development starting with obtaining necessary permits and gives permission of the local regulators and arranging surveyors to prepare the kind of plans and other documents.
Requirements of relevant physiques with regards to land titles will usually differ with each area however commonly, the plan of subdivision will not be registered until all the development works or planning requirements have been completed. These works or planning requirements may include provision of drinking water and sewerage services, tracks, footpaths and crossovers, electricity, gas and telephone services just to name a few. Usually, the relevant companies must sign off on the works. Till all the relevant authorities are satisfied that all services have been provided satisfactorily and any necessary fees have been paid they will not issue their written confirmation.
As you can see there are many steps to enrollment of your plan and many parties involved.
No assurance of settlement/closing date
Since a result, there could be no set date for pay out and no real indicator of when settlement will take place, other than the maximum time set for registration of the plan by the special conditions in the Contract. In the event that the Contract provides for a six month period for registration, then the only real expected day for settlement can be at the end of six months. Obviously, when the plan is listed prior to the maximum time set for enrollment of the routine, then pay out will take place previous with regards to the conditions of the Contract.
All of the dealings regarding registration of a plan of neighborhood are in the control of the Vendors attorneys, surveyors and other specialists or parties. Unfortunately, as the Purchaser, you have zero control over the sign up of the plan and the time it might take for this to be achieved. Accordingly, there is no guarantee of the date on which you will be able to complete your purchase of the land.
Can be this lot befitting myself?
You will need to carefully consider the time frames imposed from your Deal of Sale and whether this meets your requirements.
In the event that you wish to start out building immediately, you may need to consider purchase of land for which the plan has already been registered and that can be settled and transferred to you as soon as possible.
Alternatively, a much longer time for settlement/closing may suit you as you might not maintain any hurry to build and can use the time to save more money toward your building costs.
Some lots also come with certain restrictions/covenants on the title. These type of restrictions usually treat such issues as building size and construction materials, fencing, outbuildings, and use of the land and are usually directed to maintaining and making a certain standard of neighbourhood environment. You must ensure that any proposed building can meet the specifications placed down by the limited covenants as these will be part of your title and must be complied with. Accordingly, it is vital to check this with your builder before you sign the land deal.