If you are a first-time real estate investor or a homeowner, the term real property report might get you off-guard. This is because it's rarely used, and most people do not know about the report. As we all know, the real estate business incorporates huge sums of money. When buying land or property, you will want to be sure of the item you are buying to protect your money. That's why you will need several documents, including a Real Property Report.
What is a Real Property Report, and why should one need it? This article is here to answer these questions and more concerning the real property report. Without further ado, let's get to its definition.
What is a Real Property Report and What Does it Do?
A real property report is a legal document showing improvements relative to property and land limits, and it's one of the essential documents required in a real estate transaction. The document outlines the boundaries of a land or property and highlights additions and improvements to that parcel of land or property, its location, and the easement areas.
This property report is prepared by a qualified surveyor and helps to identify factors such as easements, adjacent properties, right of ways, and restrictive covenants. As this guide on real property reports in Calgary indicated, the property report also includes the detailed compliance issues with municipalities and helps to identify any property boundaries, among other details. Other details covered by this document include above-the-ground permanent structures and their closeness to the property lines.
Who Does a Real Property Report Help
If you are a property seller, you will want to stay protected against any legalities after selling the property. A real estate property report helps to protect the seller from any arising issues, including boundaries and improvements. It also enables sellers to inform the buyers what they are getting into when they interfere with improvements and edges done in the past.
Besides helping the sellers, the report also assists buyers by providing them with accurate boundaries and providing them with details of existing issues associated with the property or the adjacent properties. Through this report, buyers will know whether the property is eligible for future improvements or developments.
Therefore, we can say that the document puts things together for both the seller and the buyer so that no one will blame the other when issues arise in terms of developments or improvements after the property exchanges hands.
When Should You Need a New Real Property Report?
image © Gerd Altmann
You might need a new real property report when selling your bare land condo, but not when selling the apartment-style condo. However, you might need to update the old report when selling the condo before engaging the new report. The old version might be in use as long as it's still representing the property in question.
Suppose the properties or parcels of lands have changed locations or sizes, such as alterations, fencing, or made other maintenance and additions. In that case, you will have to get a new real property report to accommodate the changes made to the property.
This principle also holds true for those seeking real estate properties outside Canada. As an increasing number of individuals secure citizenship through real estate investment, it’s crucial to understand the process and requirements for obtaining a real property report in various countries. For instance, when applying for Panama citizenship by investment, applicants must include a real property report among the required documents. This ensures that the property being invested in is accurately represented and complies with all necessary regulations.
Reasons Why Property Buyers Need a Real Property Report
As a buyer, you need to have the real property report at your disposal before making the final payments for a property. Here are the two main reasons why you need this report.
It Protects You and the Property
When the property you want to buy doesn't meet the legally required boundaries, you might put your money and yourself at significant risk. With the property report, such will not happen as it defines the legally approved boundaries and notifies you when something is not right. It also gives signals if the adjacent owners are encroaching on your property, among other issues. In case of any disputes with your neighbors, you can solve them using this document.
It's Needed for Municipal Compliance
It is important to have a real property report not to cross ways with your municipal council. When you have this document, you will be ensuring compliance with the set laws. Also, you can solve any issues with the municipality before they brew into huge trouble.
You might be required to pay huge fines if you don't follow some of these laws in areas like Calgary. Through this document, you will follow the set laws accordingly and solve upcoming disputes with ease.
Property sellers and buyers need to familiarize themselves with this real property report to stay informed on property boundaries, compliance, encroachments, improvements, and any issues arising from the property in question. Also, municipalities use this document to check if the property has followed all the set rules and procedures. Therefore, it is important to have this document at your disposal as a property owner since it will help you in many ways.
