Understanding RPRs In Alberta

RPR; real property report; real estate; property; home; Alberta

Real Property Report

There is a lot of misunderstandings surrounding Real Property Reports (RPRs) in Alberta.  Not seeing one before you contract to buy a home can cause problems. Not having one when you sell your home can cost a seller the deal and more. Contact the real estate lawyers at Kahane Law Office in Calgary for any questions regarding Real Property Reports.

What Is A Real Property Report?

A Real Property Reports or RPR for short is a survey of your property. Land surveyors go out to the property and measure the property boundaries and the exact dimensions and location of each structure on the property. They use the survey monuments or stakes that the Province of Alberta placed throughout the province as the measurement points. A RPR will also show additional information such as right of ways.

Why Buyers Need To See RPRs

It is important for a buyer to see an RPR before they buy for several reasons. Following are some examples but are not a complete list. The RPR will let them visualize the actual property lines. Sometimes the location of a fence can make the property look larger or small than it is. The RPR will also set out utility right of ways and overland water drainage right of ways. Knowing these locations allows a buyer to determine where they are not permitted to build structures, if they decide to buy the home.

A last example includes understanding if a home has a structure that violates a restrictive covenant. For example, some titles include a restriction on how close to the property line a garage can sit. While the “standard” contract that is most often used in Alberta for real estate re-sales, knowing this in advance allows a buyer to either negotiate a lower purchase price or be prepared in the event that the structure has to be moved or removed.

Why Sellers Need Real Property Reports BEFORE Selling A Home

The contract that is used most often when selling a home in Alberta has specific terms regarding Real Property Reports. Who Needs a Real Property Report is definitive. Failing to have one has contractual consequences equal to not being able to provide a transfer of title to the buyers. While most transactions will still close, many close late and / or there is a delay in being paid the purchase price.

In other situations, there is a hold back of funds for weeks or months. Sometimes transactions collapse and sellers may be liable for damages to the buyer for breaching the contract. Ask your real estate agent to review your Real Property Report with you when you decide to list your home. Dealing with Real Property Reports problems before signing a contact is easier than fixing problems just before the possession date.

Problems With RPRs

The main problems that come up with real property reports include encroachments and violations of restrictive covenants. An encroachment occurs when a structure extends over a property line onto neighbouring property. To fix this issue, other than removing the encroachment, you require an encroachment agreement. Restrictive covenants sit on title to a property and restrict what you can do with the property. Problems occur when someone builds or does something with the property that contravenes the restriction.

Title Insurance Instead Of Land Surveys

People frequently asked if a title insurance policies replace Real Property Reports. In Alberta, the answer is no. Title insurance will not cover all problems with a property. For instance, if there is a known defect in the property, a buyer is better off having the seller fix it. Title insurance will not insure a known defect. It is no different that car insurance. If you have a smashed up car and then get insurance, the policy will not cover those repairs. It is almost always easier and less expansive for a seller to offer to pay for title insurance for a buyer instead of fixing problems, but then the buyer has to deal with that problem.

Some problems are significant. Talk to your real estate lawyer so that you understand the risks as both a buyer and a seller. A seller’s ability to negotiate to provide title insurance instead of a Real Property Report that satisfies the terms of a contract, depends on the real estate market. In a sellers’ market, a seller has a better chance than a buyers’ market.

Help With Real Property Reports

If you are buying or selling a home and have concerns around Real Property Reports, call the real estate lawyers at Kahane Law Office. We are able to help and can usually get you in within a day or two. Please reach us locally, in Calgary, at 403-225-8810 (or toll-free at 1-877-225-8817), or email us here directly.