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Planning Act and 21 year Leases

By
Commercial Real Estate Agent with RE/MAX West Realty Inc., Brokerage (Toronto)

Question:

 

The Planning Act addresses the fact that any conveyance of land affecting the right of the land for more than a 21-year period is invalid except for certain circumstances. 

 

Answer:

 

The 21 years presents itself in a rather peculiar way. You can sell without a consent under the Planning Act:

1) a registered lot on a plan of subdivision, or  

2) a previously severed parcel of property.

One very interesting way to get around the severance issue would be to grant a long term lease. Here, we have land leases for as long as 99 years. In England, they have leases for 999 years.

So, to prevent the severance by way of lease (without consent), they came up with the 21 year rule.

That means, if the property is not otherwise severed and you are trying to create a new smaller lot, you may do so for 21 years less a day, without consent, or 21 years with consent.

Ontario Real Estate Source

Chris Smith
Re/Max Chay Realty Inc., Brokerage - New Tecumseth, ON
South Simcoe, Caledon, King, Orangeville Real Esta

Brian, this is interesting information and has relevance to a community, Tecumseth Pines where I do a lot of work.

Aug 14, 2011 01:24 AM