Residential Real Estate Pricing Considerations: 2021 Update

On , In Insights, Real Estate

A lot has changed in the world of real estate in the past couple of years, and we’re not just referring to the red-hot market that we’re experiencing right now.  In this article we will discuss some of the recent changes in the services provided by and costs incurred by legal professionals practicing in the area of real estate law.

Effective January 1, 2020 new rules came into force for lawyers with respect to confirming source of funds and verifying the identity of clients. Lawyers are now required to obtain information regarding the source of funds provided by clients with respect to real estate transactions. Specifically, lawyers are required to obtain confirmation of whose money is being used for a purchase as well as the source of such funds. If the funds are from a third party, lawyers are also required to obtain information about the third party. Lawyers are required to document and keep records with respect to the source of funds for each transaction. 

The Land Owner Transparency Act came into force in November 2020 which requires that a transparency declaration be prepared and filed with every title transfer filed with the Land Title and Survey Authority. In addition, if the seller is a “reporting body”, as defined in the Land Owner Transparency Act, a transparency report must also be prepared and filed. The fees charged by the Land Title and Survey Authority are $5.00 per transparency declaration and $35.00 per transparency report.

Another recent change was an overhaul of the forms and filing procedures for all real estate transactions filed with the Land Title and Survey Authority. Transfers of real estate are now done using “web filing”.  While some of our programs anticipate integration so data entry isn’t duplicated in multiple places during a standard real estate file, they are not in place yet. Accordingly, we currently have to manually enter data in various programs. As with most things, the fees charged by the Land Title and Survey Authority have also increased over the years. The most recent increase took place on April 1, 2021.

There have been a number of other price increases that been imposed by various third parties. Here are a few examples:

  1. The cost of ordering documents through the Land Title and Survey Authority (Ex. title searches, plans, charges, legal notations, etc.) have continually increased over the years as well. The most recent price increase took place in April 1, 2021 and happen annually each year on April 1.
  2. Service charges are now being imposed by the programs required to order strata documentation.  For example a Strata Form F that would cost us $15.00 + tax, now costs $45.00 + tax.
  3. Most municipalities recently increased their prices for tax and utility searches. For example, the cost of a tax search from the City of Kelowna increased from $34 + tax to $43 + tax this week.
  4. Many mortgage lenders now require lawyers to use “portals” for mortgage instructions and payouts.  Portals charge user fees to the lawyers anywhere from $31.50 + tax per file to $65.00 + tax.

With COVID-19 and the acceptance of providing certain legal services via video conferencing, the Law Society of British Columbia has advised all lawyers to be extra vigilant with respect to fraud. Accordingly, we are taking additional steps to comply with the Law Society of British Columbia’s recommendations for fraud prevention. 

Right now, the Okanagan is seeing a record number of real estate transactions completed each month. We at Acorn Law Corporation are committed to continuing to provide the high standard of service that we believe every client deserves, even during these busy times. Accordingly, we have imposed caps on the number of real estate transactions that we can accommodate each month. This is to ensure that each client receives top notch legal services and has access to our lawyers and team members for any questions that come up during the purchase, sale and refinance process.

At Acorn Law Corporation we provide “all in” quotes for most of our real estate transactions. This means that our quotes include all legal fees, taxes and disbursements (out of pocket expenses for searches, registrations and other costs charged by third parties). We provide all in quotes so that clients know exactly what to expect and what to budget for. If unforeseen circumstances do arise, we communicate promptly with our client to ensure that they are aware of any deviations from the original all in quote. 

In order to remain competitive in the market and reflect the recent changes in the services required and costs incurred by legal professionals in the area of real estate law, Acorn Law Corporation will be increasing our all in quotes for real estate transactions. This change will take effect on May 1, 2021. In an effort to keep things straightforward and consistent for our clients and referral sources, we will be doing a single rate increase rather than imposing a series of increases over the coming months. Of course, we will honour all quotes given to existing clients.

We thank you in advance for your understanding as we make the adjustments necessary to reflect the recent changes in our industry. We look forward to continuing to provide top-notch legal services to our clients and support for our referral sources.

Please do not hesitate to reach out at 778-940-3768 if you have any questions regarding our prices or services or if we can be of assistance with your current or future legal needs in the areas of corporate, commercial, real estate or wills and estates. We would be happy to help!

Author: Danielle (Dani) Brito

This information is general in nature only. You should consult a lawyer before acting on any of this information. This information should not be considered as legal advice. To learn more about your legal needs, please contact our office at (778) 940-3768 or any of our lawyers practicing in the area of business law at the following:

Danielle (Dani) Brito: [email protected]

Jennette Vopicka: [email protected]

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To inquire about this service, don’t hesitate to contact us.