Buying Land and Building a House Process

A lot can be beautiful, well priced and completely wrong for the house you have in mind. The zoning might not allow it. Part of it might sit inside a regulated wetland area. The road might not be one the township will issue a permit on. None of that shows up in a listing photo, and almost all of it can be found out before you own the land rather than after.

I work with our clients from the very beginning, through design, planning applications and municipal approvals, so this is the stretch of a build I know best. Here is the order I would do it in, and what to check at each step.

The buying land and building a house process starts before the offer

Most people picture it in two halves: buy the land, then build the house. In practice the halves overlap, and the overlap is where the money is saved.

The reason is simple. Once you own the lot, every limit on it is your problem. Before you own it, every limit is a reason to negotiate, to add a condition, or to walk away. A zoning setback, a conservation authority line, a septic system that will not fit where you hoped: each one is cheap to learn about during a conditional period and expensive to discover after closing.

That is why our permits and approvals work includes a zoning review before you commit to a design, or to a property. It is also why our build process starts with a site visit. We walk the land, assess its conditions and work out where a house can actually sit, before anybody draws it.

Zoning and the Official Plan decide what the lot allows

Every lot in Ontario sits under two layers of planning rules. The municipality’s Official Plan sets the broad intent for an area. The zoning bylaw turns that into specifics: what can be built, how far from each lot line, how tall, how much of the lot it can cover, and whether a second unit or a garage with living space above it is allowed.

Before you buy, ask the township for the zoning on the specific parcel and read the section that applies. The questions that matter most are:

• Is a single detached house a permitted use here, or is the lot zoned for something else?
• What are the front, side and rear setbacks, and what is left of the lot once you take them off?
• On the water, how far back from the shoreline does the house have to sit?
• Is there a minimum lot size or frontage, and does this lot meet it?

A lot that does not meet the current rules is not always unbuildable. It may need a minor variance, which is a separate application with its own timeline and no guaranteed result. That is exactly the kind of thing to know before closing.

Water, wetlands and the conservation authority

If the land is near a lake, a river, a stream, a wetland or a steep valley slope, there may be a second approval on top of the building permit. Ontario Regulation 41/24 under the Conservation Authorities Act requires a conservation authority’s permission before development in those hazard areas and the land close to them.

In much of Simcoe County that means the Nottawasaga Valley or the Lake Simcoe Region Conservation Authority, depending on the watershed. Each authority is required to publish maps of its regulated areas online, so you can look up a lot yourself before you make an offer. If any part of the lot is shaded, call the authority and ask what it would mean for a house, a septic bed and a driveway in the places you are imagining them.

Waterfront lots are the ones where this matters most, and the ones people fall for fastest. Our post on building a cottage on a waterfront lot goes further into shoreline planning.

The road, the entrance and the driveway

You cannot build what you cannot reach, and you cannot get a permit on every road. Before you buy, find out who owns and maintains the road the lot fronts on.

A year-round municipal road is the simple case. A private road, a seasonal road or an unopened road allowance is not, and some municipalities will not issue a building permit on one, or will only do so under an agreement. Ask the township directly, and ask who ploughs it in January.

A new driveway also needs an entrance permit: from the municipality on a local road, from the county on a county road, and from the Ministry of Transportation on a provincial highway. Each has its own rules about sightlines and where an entrance can go. On a sloped or treed lot the driveway itself is a real piece of construction, and our site preparation work includes driveways and site access, tricky sloped approaches included.

While you are asking about the road, ask about hydro. If the nearest pole is a long way from where the house will sit, bringing power in is a cost of its own.

Septic and well: the lot has to support both

Most rural and cottage lots have no municipal water or sewer, so the land itself has to carry a septic system and supply a well. That makes the soil, the rock and the size of the lot part of the house.

A septic system under the Ontario Building Code needs a sewage system permit before it goes in, and it has to meet clearances from the well, the lot lines, the house and any water. The size of the system follows the size of the house, so a lot that fits a two-bedroom cottage’s septic bed may not fit a four-bedroom home’s. Shallow soil over rock can mean a raised bed, which costs more and takes up room. A test hole dug by a qualified designer during your conditional period tells you far more than a walk around ever will.

Our post on the cost to put in a septic system covers what drives the price once you know what the soil is.

Reading the well records in the buying land and building a house process

Ontario keeps a public map of well records. You can search it by address, by lot and concession, or by drawing an area, and see the wells that have been reported nearby, including how deep they went. It will not tell you what you will find on your lot. The province is clear that the records may be incomplete, and depth and yield are found, not chosen. But if every well on your road went down 60 metres, that is worth knowing before you set a budget. Our post on dug vs drilled wells explains the difference between the two.

Buying a lot that has not been severed yet

Sometimes the land you want is part of a bigger property: a corner of a farm, or the back half of a relative’s acreage. In Ontario a parcel cannot simply be divided and sold. Under the Planning Act, a consent, usually called a severance, has to be granted first, by the municipality’s committee of adjustment or land division committee.

A consent is an application, not a formality. It can be refused, and when it is granted it usually comes with conditions that have to be met before the new lot exists. If you are buying a piece of land that is still waiting on one, make the purchase conditional on the consent being finalized, and do not start paying for drawings until it is.

Paying for land and a build

Buying vacant land and building on it is financed differently from buying a finished house. Lenders tend to treat raw land more cautiously than a home, and the build itself is usually paid for with a construction mortgage that releases money in stages as the work is done. Our post on how a construction mortgage works walks through it draw by draw. Talk to your lender about both pieces before you make an offer on the land, not after.

The order of ownership matters for tax, too. The Canada Revenue Agency treats a house that you hire someone to build on land you already own as an owner-built house, and the GST/HST new housing rebate for it is one you claim yourself, using Form GST191 and, for the Ontario portion, Form RC7191-ON. There are conditions on how the house is used, its value and who lives in it first, so check the current guide and talk to your accountant. On our side, our accountant prepares a statement of all the HST paid on your build, which is what the claim needs. We are builders, not tax advisors, and we will tell you when a question belongs with yours.

The buying land and building a house process, step by step

Put together, this is the order I would follow:

1. Talk to a builder before you make an offer. A site visit costs far less than the wrong lot.
2. Make a conditional offer. Give yourself time for zoning, conservation authority, septic, road and financing checks. Your lawyer and agent will word the conditions.
3. Do the checks. Zoning and setbacks, regulated areas, a septic test hole, the well records, road ownership and entrance rules, hydro.
4. Firm up and close once the answers are ones you can build with.
5. Design the house for the lot you now own. Start from one of our 82 plans or a blank page. Our Country Retreats line includes plans with narrow-lot or smaller footprints, and plans that adapt to sloping lots for walkout basements.
6. Planning and permits. Zoning, building permit, conservation authority, entrance and septic approvals. Getting them in the wrong order can cost you a season.
7. Site preparation. Lot clearing, blasting where there is rock, excavation, septic, well, driveway and foundation preparation.
8. Construction, then the walkthroughs and the keys.

Steps five to eight are the same for every custom build, and our post on the custom home building process covers them in detail. Steps one to four are the part of the buying land and building a house process that only exists when the land comes first, and they decide whether the rest goes smoothly.

Where to start your buying land and building a house process

If you have found a lot, or you are close to one, the most useful thing you can do is have someone who builds on land like it walk it with you before you are committed. We build on your lot or one we help you evaluate, and the evaluation is the part I would never skip. From planning approvals and permits through site preparation, construction and finishes, we manage every stage under one roof.

Tell us about the land you are looking at and we will reply within two business days. You can also read how the rest of it goes in the A&R build process, or see what we handle in permits and approvals.

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