My friend recently purchased a house and despite my best efforts, she proceeded with the transaction without obtaining a survey. Exasperating! A survey in a real estate transaction is a snapshot of the property that details its measurements, easements, fences, sheds, pools, etc. A valid survey is prepared by a licensed land surveyor. The survey is then compared against the registered title to let you know, among other things, if the things that are located on the property are actually allowed to be there. You may be surprised by what you can lean about a property from a survey.
One simple example of what is readily revealed by a survey is the location of an easement. An easement allows some other entity the right to use your land. A typical example would be registrations made by utility companies so that they may run wires or perhaps piping through your property. There are obvious reasons why you would want to allow this registration, mostly to allow whatever service is being provided, however; they may also cause problems. One potential problem is the way you see yourself using the property - if there happens to be an easement in your backyard, you may be prohibited from installing that pool you have always dreamed of. As a HomeBuyer, the survey helps you to determine if the house you are considering purchasing will satisfy your future vision.
So now my friend has a house with no survey. This is not the end of the world, but it has raised some concerns; in particular, she is making arrangements to have landscaping done and has some pretty grand visions. These plans may involve installing a new fence, a water garden, a shed, you get the picture. The problem is that without the survey she will not know if her structure is encroaching on her neighbor’s property – she won’t know if her neighbors back shed has extended 2 feet on the her yard, robbing her of those extra feet of garden. She may inadvertently plant her trees on her neighbor's land…the list is potentially endless.
“But didn’t she get title insurance?” you cleverly ask…and of course, the answer is yes, but it does not replace the value that a survey brings. (Having a policy of title insurance means that title-related issues are insured and the purchaser is protected – I will post a more detailed commentary on title insurance soon.) While obtaining title insurance is a very good idea, it is most useful when something goes wrong. It does not change the fact that it is much better to avoid problems that may give rise to an insurance claim in the first place. Your best course of action is to insist on the production of a survey. A new survey will be ideal, and the seller will typically order one when planning to sell the home. Where a new survey is not available, an older survey is better than no survey. Make sure your agent writes the necessity of one in to any Agreement of Purchase and Sale that you sign.
So, what does the survey say? How will you know if you don’t get one?
Rachel Loizos is an associate lawyer at Sotos LLP in Toronto. She practices in the area of real estate law.