Buying a Cottage

by Heather Camlot, moneysense.ca

You dream of waking up to birds chirping, taking the kids canoeing on the lake or cross-country skiing through the woods. You've always wanted a getaway of your own that requires no reservations and no planning. But the charms of country living can turn into a nightmare if you don't take precautions before purchasing that second home.

Like any real estate purchase, buying a cottage in the country requires doing your homework, agreeing on a price, signing an agreement and transferring the title of ownership.

Buying a second home also requires asking questions that aren't necessary when looking for a home in the city.

Can you afford a second home? The first step is to discuss with your spouse how much you can comfortably spend, says realtor Jeff Buddo.

Next, determine what locations your investment range will cover, says Buddo, who deals with sales in Ontario's cottage country.

"Identify the preferred areas of the province and then confirm that the investment range will buy the cottage that you want in that area," he says.

Financial institutions can help you increase the mortgage on your city home, create a second mortgage or offer a separate financing plan for cottages. Mortgage rules will be different depending on the condition and type of property involved. Mortgages for fully completed and winterized homes with year round access are usually charged the same loan rate as primary home mortgages. Second homes not easily accessible year round or incomplete structures are charged a higher rate.

Once you know what you can afford, where the money is coming from and the area you'd like to live in, it's time to shop around.

Buddo encourages his clients to speak with friends who have bought homes in your preferred area and to "identify the attributes of the property that are important to them." Some attributes include the terrain - gently sloping or elevated for a view - and water depths. Do you want the water to be deep for diving and docking a boat or shallow and sandy for children?

Be aware that the perks of living in the city, such as sewage systems, clean water and garbage trucks, will probably not follow you into the country.

City homes and cottages require asking the same inspection questions. But a cottage has potential for additional risks and costs. To avoid future pitfalls, look into the following:


Access

Cottages are not always connected to the highway by public roads. Find out if the road you need to take is public or private, who maintains it, whether it is open year round and if a legal agreement exists for your use of the road. Similarly, if the home is located on an island, find out how to make arrangements for water transportation.


Water

Normally, a house in cottage country pumps water from a surface source, such as a nearby lake or river, or from a well.

If it's from a lake, find out what else it's used for. Does it serve recreational or industrial purposes? Also, find out how the water is drawn and whether the supply has ever been interrupted because of freezing weather.

If the water comes from a well, find out whether it is on higher ground than the sewage system, how fast it reaches the home and whether the well has ever dried out. Water should be tested once a year for acceptable levels of contaminants.


Sewage system

Septic systems are strictly regulated by the Environmental Protection Act, especially when they are near surface water sources. It is vital to check the sewage disposal system, which is usually a septic tank or a tile bed. Make sure there is a current certificate of approval and use permit for the system and that the system works. Examine the lot to see how close trees are to the tile bed. Tree roots can invade and block both types of systems.

Find out when the system was last serviced and when the tank was last pumped out. Ask about previous sewage blocks and backups. And determine whether your plans or municipal developments will eventually require you to connect the home to a town water or sewer supply. The transformation can cost thousands of dollars.


Developments

Ensure that current structures have been approved and find out whether the additions or renovations you'd like to add will be granted. Be sure to include these provisions in the agreement of purchase. Docks, boathouses and any other structures that extend over the water also require permission before they can be built. In some cases, altering the slope of land or filling in parts of the land may require municipal approval.


Land

Part of the joy of living the country life may be freedom from city restrictions but you may not enjoy people cross-country skiing across your lawn or swimming in the bay by your house. Ask about local laws concerning hunters, snowmobilers and others crossing private property, water exclusivity and right of ways and easements for utility companies and neighbors. Also verify land limits, zoning and special environmental restrictions.


Other details

No one likes to do chores when they are on vacation but someone has to take out the trash. Ask the city whether there is garbage pick-up or if you are to drop it off at a designated dumpsite. If the cottage is on lakefront property, you will want to find out about fishing regulations and motorized watercraft use. There may also be horsepower and size restrictions for boats.

Finding a cottage means asking a lot of extra questions. Owning one means maintaining and repairing more than one home. But if you're up to the challenges and if the lifestyle suits you, country life is a pleasure you'll wonder how you ever lived without.