Recently, a number of my clients buying homes in Spruce Grove, Stony Plain, Parkland County and the Edmonton region have agreed to accept Title Insurance in place of an RPR.  What do these terms mean?  What are the advantages and disadvantages? 

An RPR, or Real Property Report, is a survey of a property showing exact measurements of boundaries and the placement of all improvements or permanent structures (house, garage, shed, deck, fence, etc.), as well as the location of easements, utility rights of way, and so on.  The RPR is a legal document prepared by an Alberta Land Surveyor.  A certificate of municipal compliance attached to the RPR means that local rules have been followed regarding the current state of improvements.  That is, every structure on the property is the proper distance from the property boundaries or rights of way, permits are in place for things like attached decks of a certain height, and so on.

Real estate purchase contracts in Alberta require a seller to provide a buyer with a current RPR in conjunction with written proof of municipal compliance.  This could be problematic if the sellers have made improvements to the property, such as adding on to the home, putting up a fence, building a deck, and the like, and maybe they did some of these things without getting a municipal permit.  This would mean that the RPR they received when they purchased the property no longer reflects the current state of the property.  The sellers are then obliged to order a new RPR from an Alberta Land Surveyor (and this isn’t cheap or quick), or update the old one.  The sellers must also seek retroactive municipal compliance for neglected permits, sometimes a lengthy, complicated and difficult process – unless the buyer waives the requirement for the Real Property Report with municipal compliance.

Waiving that requirement may put the buyer at risk should it turn out that the improvements do not comply with municipal rules.  What if the detached garage was built too near the property line, or on top of the gas line?  What if the deck built on to the side of the house hangs over the neighbor’s property by a foot?  The new owner of the property could be on the hook for the considerable expense of making these things right, not to mention the hassle of tearing down perfectly good structures that just happen to be in the wrong place.

That’s where Title Insurance comes in.  Title Insurance in Alberta “guarantees” that improvements on the property comply with zoning bylaws and that there are no encroachments either from other properties or onto other properties.  Title insurance doesn’t magically make problems go away.  But, if bylaws have been broken or encroachments exist, title insurance (with some restrictions) will pay the cost of obtaining compliance or removing encroachments. 

Advantages? 

• Title insurance can be a good compromise in situations where a new RPR would uncover a problem (for example, no permit for an attached and covered deck) whose solution would be much more costly or invasive or time-consuming than either seller or buyer wants to undertake.
• It can also be an excellent hedge against such things as mortgage or title fraud, builder’s liens, or hidden deficiencies, such as basements developed without permits, underground storage, and the like.
• Title insurance usually costs considerably less and is often easier and faster to obtain than a new RPR.

However… there are some disadvantages that buyers in particular should be aware of:

• Property buyers in Alberta should know that the concept of title insurance originated in the US where citizens do not enjoy the same level of protection that the Alberta system of land titles registration provides.  An up-to-date RPR with municipal compliance is still the best protection for a buyer, as it ensures that the property meets all current bylaws, regulations and the like.
• Title insurance does not reveal underlying issues or correct structural deficits.   It merely provides the financial means for the future to clean them up should they be discovered and should there be an insistence that they be made right.  Note also that title insurance, even if obtainable, does not absolve sellers from the legal obligation to disclose all known defects about their property.
• The usual arrangement when title insurance is offered in place of an RPR is that the buyer purchases the insurance and is reimbursed by the seller, as per the purchase contract.  The new owner of the property is then the holder and beneficiary of the insurance policy for as long as he owns the property.  But… when it is time for him to sell the property, he must either pay for a new RPR after correcting problems, or offer and pay for the same deal he accepted, hoping that the new owner will agree to title insurance – not a foregone conclusion.

So, as a buyer, what is your best course of action?  Given the above, it might seem that you should always insist on a new RPR.   Sometimes that is the right thing to do.  But there are many situations, especially in cases where “correcting a problem” may be worse than living with the status quo, and where time is a limiting factor, when accepting title insurance in place of a missing RPR or in addition to an outdated RPR is the way to go.  Your realtor and lawyer are in the best position to help you decide.

For more information and detailed examples:

Real Estate Council of Alberta (RECA) Information Bulletin:  Title Insurance

Real Estate Council of Alberta (RECA) Information Bulletin:  Real Property Reports

(The above article is not intended to cover all aspects of the topic of RPRs and title insurance.  Buyers and sellers are urged to seek detailed expert advice relevant to their personal situations.)

Questions or comments about this or other real estate matters?  I’m here to help!  Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

A guest blog article from one of my clients who refers to herself as Ms. Cranky Pants:

So, Barry took me to see your house in the region of Spruce Grove, Stony Plain, Parkland County, and Edmonton, and I just wanted to mention the things that made me go Ewww.

Odors

I know you think all those little room deodorizer thingies will hide the fact that you’re a smoker, but you can’t fool me.  I wish I didn’t know that you had fried fish with onions and garlic for dinner.  And seriously people, do you ever clean that stinky litter box?  Open a window, for crying out loud!

Dirt

Disgusting grime in the tub, sticky spots on the kitchen counter, dirty dishes in the sink, mystery stains on the carpet, something brown and nasty in the corners…  Yuck!  I’d hate to have the CSI folks go through here with their ultra-violet lights.  I’m not a clean freak but no way do I want to wallow in anybody else’s crud, thank you.  Soap and water and elbow grease are cheap – get busy!

Stuff everywhere

When I view homes, I try to imagine living in the rooms with all my belongings in place.  Kind of hard to do when your junk is clogging up the space, making the place feel smaller than it really is.  Plus, it’s a real turn-off to see personal things like your toothbrush, razor and soggy towels cluttering up the bathroom, for example.  You need to get rid of at least half the stuff in your house — and I don’t mean hide it in the closets or the garage because I’m looking in there!  Here’s a tip:  Visualize a nice hotel room before you move in and unpack – sparkly clean, neat and tidy, room to move around.  That’s what your home should look like for showings.

Damp basement and water stains

Oh boy, is this one a red flag.  If I can see the results of water leakage, I just know I’d be buying a boatload of trouble to take on this baby.  Maybe you’ve got a bad foundation, but it’s more likely that water from spring runoff or summer rains is getting in because 1) your landscaping and grading isn’t sloped adequately away from the house; 2) your eavestroughing needs some work, with rain gutters cleaned out and downspouts aimed well away from the house; 3) your underground drains are clogged; or 4) your sump pump, if you have one, isn’t working properly.

Evident lack of maintenance or upgrading, or unfinished or poorly done reno projects

Yeah, I know your house isn’t brand new so you don’t have all the latest fixtures and decorative doo-dads.  I don’t mind a house that’s used.  What I object to is a house that’s used up.  If you’ve lived in your house for longer than 10 years, then it’s time to fix it up.  That could mean repairing broken windows, tightening loose hinges, or replacing cabinet handles, switches and plug-ins, faucets and shower heads.  It might also mean fresh paint inside and outside (neutral colors, please!).  Maybe what’s needed is a new roof, new furnace and hot water heater, new flooring or new appliances.  It could even mean a professional renovation of kitchen and bathrooms.  Notice I said professional renovation.  Do it yourself only if you have the skills and tools to do it right.  Oh, and don’t wait till just before it’s time to sell to do those things.  Maintain and renovate on a yearly basis so you get to enjoy your investment.

Weird decorating

I counted 5 different wallpaper patterns and 4 different types of carpet and lino just on the main level, but the real clincher was the purple living room, black bedroom and the mustard yellow dining room with its psychedelic wall mural!  This may be what you like to live with, but I want my house to be a frame for my life, not a Halloween horror show.

Lack of light

Hard to see if there are great features in this house because it’s like a cave in here.  I respect people trying to save money and energy, but up the wattage on the light bulbs so prospective buyers can actually see what you’re selling.  Open those drapes and blinds.  Trim the shrubbery from in front of the windows.  Clean those dirty, foggy windows.

Poor curb appeal and unattractive yard

I don’t know about you but I make a little effort when I show my face in public.  Same thing applies to houses.  Like it or not, first impressions count.  If your front door is askew and the paint’s peeling, if your driveway and sidewalks are cracked, plants overgrown, lawn brown and patchy, and there’s trash everywhere, this tells me you don’t care.  So why should I even bother to enter the front door if what I’ll see on the inside is more of the same?  Show a little pride, folks!

Pets on the loose

Hey, I love animals but your big snarly pooch scared the whatsits out of me.  I came to see your house, not get mauled by Cujo.

Price too high

Of course I’d like a bargain, but I’m willing to pay what’s fair for a decent house.  If your house needs a little work… well, I can forgive quite a lot if the price is right.  But there’s plenty I won’t pay for.  I don’t care that you spent $20,000 on a fancy new hot tub and deck, or that you owe too much on your mortgage to reduce the price to what’s reasonable, or that you have to have a certain amount so you can move into a bigger and more expensive house.  Price your house right based on factors such as its location, age, condition, size and what similar homes in your area have sold for, and I just might make you an offer.

Barry has some great articles in this blog on home staging and getting your house ready to sell.  Take a look at these:

Be Your Own Home Stager

Thinking of Selling Your Home in Spruce Grove, Stony Plain or Parkland County? 

Home Staging Starts With De-cluttering

Barry can help you find a great house, or sell your current one.  Call or text him at 780-910-9669, email him at barry@barryt.ca, or contact him here. 

The phrase “Dress for Success” has a different meaning in real estate than it does in other businesses.  You know that before you put your Stony Plain, Spruce Grove, Parkland County or Edmonton area home on the market, it’s important to clean it thoroughly, get rid of clutter, and make minor repairs.  But these days, in order to sell your home in the shortest amount of time and for the best price, that’s not going far enough.  The next step is home staging.

What is home staging?

Home staging is literally setting a scene and creating a mood – transforming an ordinary house into an attractive, welcoming home that any potential buyer might envision himself living in.   The key is universal appeal.

Secrets of home staging

Home staging doesn’t mean erasing all evidence of the people living in the house, but it’s important to remember that how you live in your home and how you sell your home are two very different things. 

Differences show up in the number and type of things on display, the size of furniture and how it’s arranged, and in the general state of cleanliness and tidiness.  This is one situation where “good enough” probably isn’t!  A perfectly staged home is going to resemble more a suite in a 4-star hotel – before a guest unpacks! – than the homes most of us grew up in or currently live in.  With that in mind, here are a few things to know about home staging.

Update.  The simplest and least costly upgrades, besides paint, include light fixtures, taps and faucets, door and cabinet hardware, switches and switch plates, and drapery and window treatments.

Neutralize.  Neutral colors for walls and floor coverings are best.  People must be able to visualize themselves and their own possessions in the home so the decorating must serve only as a backdrop.  Neutralize also means keeping things generic:  “middle-of-the-road” décor, furnishings and accessories.

Clean.  Really, really clean; mother-in-law clean; brand-new-home clean….!

Edit.  People must be able to see the space, not the stuff in the space.  Corners must be visible, rooms must appear to be open and airy, closets need to look spacious and unfilled, and so on.  This may mean that typical home sellers have to dispose of or pack up for off-site storage 30% to 80% of their possessions.  For example, your kitchen counter should be as close to cleared off as you can make it, with maybe just a coffee maker and toaster to suggest its functionality.  In the bathroom, remove all personal care items, cosmetics and the like from the counter, leaving perhaps just a fresh container of liquid soap next to the sink.  And so on.  Tip:  Take a photo of a room in your house.  Chances are the “too much” factor will be more evident in a picture.

Depersonalize:  Small numbers of family photos, personal memorabilia and items connected to hobbies are fine.  What isn’t fine is anything that detracts from a potential buyer seeing himself in the space.  People don’t want to look at your toothbrush or razor in the bathroom, dirty dishes in the kitchen sink, or piles of clothing on the laundry room floor, for example.  In other words, the place must not look used.

Tidy:  Whatever items are left after possessions have been edited need to be arranged as neatly as possible.  This means not only things readily visible but also everything in closets, drawers, cabinets and other storage spaces in every area of the house, including the garage and outdoors.   As always, the point is to make spaces appear as roomy and functional as possible.

 Sense it.  I’ve heard that 75% of the buyer’s decision is affected by the first 5 seconds through the front door.  Sight and smell are going to be the most important senses in that first impression, and their impact is instantaneous.  Never underestimate the effect of the sight and smell of fresh flowers!

 Light it.  Remember that home staging is about creating a mood.  Warm and bright will sell your home.

Suggest.  Of all the “secrets” of home staging, this is the most important.  Suggest a feeling of hominess and coziness by arranging a few pieces of furniture, such as a pair of modest loveseats and a couple of smallish tables and lamps, in an appealing vignette which will make the buyer want to be a part of it.  Add some accessories such as colorful cushions, a throw in a soft fabric, a couple of classic books or a tea service or a potted plant on a side table with a lamp turned on.  Keep the number and size of items small to trick the eye into maximizing the proportions of the room.  The phrase “less is more” is the very essence of home staging, employing subtlety, simplicity, refinement and classic design.  Everything in a space is there to highlight the best features of the space.  Tip:  Visit a store like Ikea and study the room vignettes.  These are perfect examples of home staging.

Accessorize.  Besides basic furniture appropriate to a given room, professional home stagers add a variety of accessories to hint at feelings or activities associated with that space.  For example:

• in the kitchen: a large bowl of fresh, colorful fruit; an open cookbook; a new matched set of tea towels and oven mitts
• in the bathroom: new clean towels tied with ribbons on the side of the tub; a spa basket of scented soaps and lotions on the counter; a small tray of scented candles
• in the bedroom: new bedcovering and extra pillows; a simple swag of fabric draped above the windows; a small ottoman with an afghan throw; small bedside tables with lamps turned on
• in the living room: mirrors; potted plants or silk flowers; area and throw rugs; a display of unusual knickknacks in a grouping of 1, 3 or 5 items
• on the patio or deck: a small patio table and a pair of chairs, with perhaps a potted plant on the table, to suggest a conversational grouping

While all of this may seem like a lot of work, most sellers who take the trouble to stage their homes really do see a better price within a shorter time frame.

 Ready to sell your Spruce Grove, Stony Plain, Parkland County or Edmonton-area home?  Contact me here, email me at barry@barryt.ca, or phone me at 780-910-9669.