Toronto Parking By-law Jeopardizes Closing
By Brian Madigan LL.B.
(Ontario Real Estate Source)
Why would a real estate transaction be at risk?
Well, the answer is simple enough: Toronto's new parking by-law.
Here are the new rules which came into force on 1 October 2010:
· If you have a one car garage, you can park one car in the garage and one car on the driveway
· If you have a two car garage, you can park two cars in the garage and two cars in the driveway
· No more than two parking stalls are permitted in a rear yard
· Previous arrangements will be considered legal non-conforming
On average most real estate transactions will close within 60 to 90 days from the date they are actually sold.
What does that actually mean? Closings in October result from transactions negotiated earlier. Some, perhaps in September (30 days), more from August (60 days) and others from June (90 days).
Let's go back to our situation with Mollie. She and her late husband moved into their Toronto residence in the 1970's. The husband removed the old garage. It was about to fall over. They had one car and parked it on the driveway. They had four children and all four got cars and parked them on the driveway too. However, the children got married and moved out. The husband passed away and Mollie without a car, and without a family decided to downsize and move into a condo.
As luck would have it a young professional couple bought her house just a few days after it went on the market. In fact, there was a bidding war, and one of the important reasons that the property went for $80,000 over asking was the long driveway that would accommodate 5 cars. Both the husband and the wife drove SUV's and needed their vehicles for work.
So, when did they buy? Sometime before 30 September 2010. And, when does it close? Sometime after 1 October 2010.
The problem, of course, is the intervening passage of the city of Toronto parking by-law.
When they bought the house, the buyers could have parked 5 cars on the driveway. But, they only needed two spots. However, by the time of closing the city had eliminated all the spots. There was no garage, so there wasn't even one spot, let alone two.
Interesting problem!
Both parties should consider contacting their lawyers.
Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com
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