Do You Need a Lawyer to Buy a House in Manitoba?

You have found a place, or you are close to making an offer, and you are wondering if hiring a lawyer is really necessary. It is a fair question. Buying a home is probably the largest purchase you will make, and every step seems to have a cost attached.

This article explains what the law in Manitoba does involve in a purchase, what a lawyer commonly handles, and what can go wrong if nobody carefully checks the paperwork. It does not replace advice on your own purchase.

This article covers the law of Manitoba.

What the law says about using a lawyer

The rules in front of us describe how land is bought and registered in Manitoba. They do not give a simple one-line answer to whether a buyer personally must hire a lawyer. What is clear is that the process has legal parts that are hard to do casually: land transfer tax is generally payable by the buyer and is due when the transfer of title is registered, and registration is completed when the certificate of registration is signed or the data is accepted in the electronic system.

Whether you can handle those steps yourself, and whether your lender will let you, depends on your situation. A lawyer can confirm the position for your purchase before you commit.

Why the title system matters to you

Manitoba uses a land titles system. The Real Property Act says its object is to simplify the title to land, give certainty to it, make it easier to prove and speed up dealings with it. In practice, what you are buying is the registered interest in the land, so the record matters.

Registration is completed when the certificate of registration is signed or the data is accepted in the electronic system, and it takes effect from the day the instrument is assigned a serial number. The Act also deals with priority of registration, which is the order in which competing interests rank. A mistake or delay at this stage can affect where you stand.

Land titles registrations in Manitoba are electronic and run through Teranet Manitoba, and the Law Society of Manitoba has eRegistration rules and requirements for lawyers who register documents.

Money steps that are easy to get wrong

Land transfer tax is payable by the buyer, with some exceptions, plus a registration fee. It is due when the transfer of title is registered. It is worked out on the fair market value of the property on the date of registration, not simply on the contract price.

The brackets are 0% on the first $30,000, 0.5% on $30,001 to $90,000, 1.0% on $90,001 to $150,000, 1.5% on $150,001 to $200,000 and 2.0% on the amount over $200,000. A $350,000 value works out to $4,650. Manitoba's land transfer tax information does not mention a first-time buyer rebate, so do not budget for one.

Federal programs can help with a down payment. The Home Buyers' Plan withdrawal limit is $60,000, and you can use an HBP withdrawal and a First Home Savings Account withdrawal for the same home if all conditions are met at the time of each withdrawal. Check the Canada Revenue Agency's conditions before relying on either.

Situations where the risk goes up

• Condominiums. On a resale, the seller must give you a package that includes a disclosure statement, a corporation disclosure statement signed within 90 days, the declaration, budgets, financial statements, by-laws and rules, and any reserve fund study or summary. Reading these closely takes time and care.
• Short deadlines. The condominium cooling-off period is only seven days, starting on the later of signing and delivery of the disclosure documents.
• New units sold before the condominium is registered. A different package applies, including a declarant's disclosure statement and proposed by-laws.
• Sellers that are estates. A deceased sole owner's house needs a court grant so a personal representative can apply to Land Titles. If the grant came from another province, resealing or an ancillary grant in Manitoba may be needed.
• A lender is involved. Mortgages and other registered interests, such as caveats, are governed by the Real Property Act.

What to do next

Before you decide, get the facts that apply to you. Ask your lender, in writing, whether it requires a lawyer to act on the mortgage. Then ask a lawyer what they would review on your particular property.

• Ask your lender what it requires at closing.
• Keep the signed offer and any listing documents together.
• If it is a condominium, note the date you received the disclosure documents.
• Estimate land transfer tax using the brackets and confirm the amount before closing.
• Speak to a lawyer before you remove conditions or sign anything binding.

Frequently asked questions