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Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

March 1st - 2011

Fascination with history plays role in appeal of heritage properties

Although Henry Ford famously remarked that “history is bunk,” people with a love of all things historical would disagree with the renowned automaker.

Although Henry Ford famously remarked that “history is bunk,” people with a love of all things historical would disagree with the renowned automaker.

Some say an appreciation of history is vital to human development, including philosopher George Santayana, who argued that people who don’t remember the past “are doomed to repeat it.”

Heritage properties offer a tangible connection to a neighbourhood’s history, and their endurance and character often add to their appeal, according to real estate and architectural conservation professionals.

“In the early days of my real estate career, I don’t remember many people who were interested in old properties, but I’ve noticed a real sea change,” says Robert Hulley, a retired Toronto REALTOR®, and current advisor to the Architectural Conservancy of Ontario. “Back then, the last thing people wanted was something ancient, but now there’s a groundswell of interest, and buyers are out there looking specifically for heritage properties -- people with an interest in history and a fascination with the past.”

Heritage properties often deliver a lot of character in an individualized way, Hulley notes. “Some homes contain so much detail, even in something like the window trim,” he says. People in a certain income bracket may be very interested in buying and/or restoring heritage properties and furnishing them in period, he says.

Just as many people love antiques, heritage properties, by the same token, can be very appealing. Heritage designation applies to real property and identifies features or attributes that support its heritage value. When it comes to buildings, these attributes can include anything from brickwork to doors, windows or woodwork, and can pertain to individual characteristics or a combination of elements on the interior or exterior of a property.

If you as a REALTOR® suspect that a property is, or may in future be, designated a heritage property, it is vital to check its status. Municipalities across Ontario maintain lists of designated heritage properties (and properties considered of heritage value), along with the attributes that characterize those properties as heritage.

Municipalities may designate a property as heritage based on at least one of three criteria related to design, historical or contextual value. Ontario Regulation 9/06 of the Ontario Heritage Act (OHA) spells out how the criteria are defined.

Although a property’s heritage designation must be registered on title and included in the real estate listing, it should always be disclosed to potential buyers. Those who wish to build additions or make alterations to a heritage property may be required to seek consent from the municipal council and will need consent to demolish a building on a heritage property.

If buyers are planning major renovations or thinking of tearing down the building, they need to know that heritage properties are protected and there may be things they can’t change.

For instance, if a home’s interior attributes have been identified in the heritage designation bylaw and contain expensive finishes such as plaster molding or foot-high oak baseboards, a buyer who wishes to match that style should be aware there can be added costs in using those materials.

One buyer may be thrilled to get a heritage home, while another may not be aware that the designation can limit or thwart his plans for changing the premises on the site. That’s why disclosure is so important. It protects the buyer, the seller and all of the registrants involved.

One of OREA’s standard clauses addresses heritage properties. If a property is heritage or if there’s a chance it may be designated heritage, the REALTOR® should include HERIT – 1, Ontario Heritage Act Designation clause, below, in any Agreement of Purchase and Sale.

“The parties hereto acknowledge that the subject property is/may be designated as a Heritage Property and is subject to the provisions of The Ontario Heritage Act, 1974. The buyer acknowledges that the seller has made this disclosure. The buyer accepts the property with this designation and agrees to continue with this transaction.”

Often, the seller will disclose the fact that a property is designated heritage because it is a point of pride, but also because she believes it may fetch a higher price. If for some reason a seller does not want to disclose, the onus is still on the listing salesperson to inform prospective buyers of the designation. Section 21 of the REBBA 2002 Code of Ethics requires that a registrant take reasonable steps to determine and disclose material facts about the property. This includes not only properties already designated heritage but also those in the queue for consideration as such.

In advertising a heritage property, REALTORS® may want to play up its designation. The historical character and charm of the site may be a key selling point. Something like, “Sir John A. Macdonald slept here” or whatever the case may be, could be very appealing to potential buyers.

Buyers interested in heritage properties may also want to think about their insurance needs on such a property. For instance, in the event of damage, owners will want to know in advance whether their insurance covers reproduction value (which may mean higher premiums) and not just replacement value. This is at the discretion of the owner, since reproducing damaged features is not required by the heritage designation bylaw.

Seeking a home inspection is a good idea, and Hulley advises buyers to seek an inspector with knowledge of and experience with heritage properties. Potential buyers may also want to consult a structural engineer to verify the soundness of the “bones” of the property.

Heritage properties continue to appeal to a certain segment of the market, and those in designated heritage districts may reap higher prices than “one-off” heritage properties that are unique to their neighbourhoods, says Hulley. Buyers may also wish to explore whether there are any grants available to them because of the property’s heritage status.

Whether you’re listing, showing or viewing a heritage property, it’s crucial that you as a REALTOR® be aware of all of the factors involved in dealing with this unique and historical type of real estate. Be sure to share those considerations with your clients so that they can make an informed decision.

More information about heritage properties can be found on the following websites: the Ontario Ministry of Tourism and Culture at www.mtc.gov.on.ca, the Ontario Heritage Trust at www.heritagefdn.on.ca and the Architectural Conservancy of Ontario at www.arconserv.ca.

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Jean-Adrien Delicano

Senior Manager, Media Relations

JeanAdrienD@orea.com

416-445-9910 ext. 246

Ontario Real Estate Association
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