Out of town buyers guide

If you are buying a property in Montreal as non resident, it is important that you know what special conditions apply. 

1. Canadian lending institutions will grant you mortgage of no more than 65% of the value of the property, therefore you need to calculate you purchase according to a minimum of 35% cash down.  In the case of a multi unit dwelling the amount of cash down required may be up to 50% of the purchase price. Your interests rate may also be anywhere from 1-1.5 % higher than the going mortgage for a resident.  It can therefore be advantageous to get a loan (i.e. refinance your current property), from your own local financial institution.

2.  Insurance companies will insure a property if you are the main occupant, however if you will not be living in the property, you should know that getting insured will be a little more difficult.  If you rent your property the tenant will be responsible for liability and content insurance.  In the case of a condo your annual condo fees will normally cover building insurance, so the only insurance you will need is liability.

3. Notary in the province of Quebec is the only person authorized to prepare an act of sale and the loan documents.  The notary will be responsible for clearing all the titles and researching any information relative to the property.  They can also provide you with any power of attorney documents you may need to have, as well as hold any funds in escrow. (average cost for a condo is 1500-2000$

4. It is recommended to have a certified professional inspect your property as a condition to purchase.  The costs of the inspection is paid for by the buyer, price can range from 350-500$, bear in mind that up to two inspections may be required before you settle on a property.

5.  Funds brokers are used when transferring funds from one place to the next.  The average transaction or transfer can take between 2 days for US- Canada 7 days for European–Canada.  Mortgage brokers generally have larger volumes and can give you the better rate than Banks on you exchange. The broker can also have the funds transferred to the acting notary in a shorter amount of time.

6. Rental board rules can be obtained by visiting the Regie du Logements which has a great website to answer any questions you may have about your rights and obligations as a landlord.

In order to orchestrate all of the above and ensure that you are informed and ready during the purchase process you should have a real estate professional who will work with you to coordinate the various steps.  To find out more about current real estate statistics drop us an e-mail and we can provide you with some additional information.