Real Estate 101: Key Steps in Buying a House

For many, buying a house is the largest, and most important, investments they will make. Given its importance, and price tag, there are many considerations involved in the process of purchasing a house.

This article is intended as a broad overview of the key legal steps in the standard purchase of a residential house. For more information on concepts within this article, we invite you to either contact our office, or, as additional articles are posted, click the links embedded within to learn more.

1. Drafting and Signing the Offer to Purchase

The first big step in purchasing a house is submitting an offer to purchase to the Seller (the “Offer”).

In Ontario, when you buy real estate, the Offer must be submitted in writing. Among other things, an Offer will identify the Buyer, the Seller, the property being purchased and the purchase price, when the purchase will take place (closing date), and will also set out any chattels to be purchased by the Buyer and rental contracts to be assumed by the Buyer on closing. Finally, and most importantly, the Offer should clearly set out any conditions before the Offer can become a firm agreement of purchase and sale. Attached to the Offer may also be a “Seller Property Information Sheet”, as well as other disclosure statements or additional information provided by the Seller about the property.

Where real estate agents are involved, the Offer will be drafted by the Buyer’s Agent and submitted to the Seller’s Agent for the Seller’s review and consideration. If you decide not to use a Buyer’s Agent, it is highly recommended that you have a real estate lawyer draft and review with you the Offer before it is submitted, this way you can ensure that it meets your needs and expectations. In addition to drafting the Offer, your Agent or lawyer can also help negotiate terms in the event of a counteroffer.

Once signed by the Buyer and delivered to the Seller, or the Seller’s Agent, there are three potential outcomes:

  • the Offer is not accepted,
  • the Seller responds with a counteroffer that contains different terms then the initial Offer, and which will be open for the Buyer’s acceptance (or further counteroffer) for a defined period of time, or
  • the Offer is accepted and becomes either a conditional or binding agreement of purchase and sale.

2. Fulfilling Conditions of the Offer

Once the Offer (or counteroffer) has been accepted, the next step is for any conditions contained in the Offer to be either waived or fulfilled by the applicable party. In the event that there were no conditions in the Offer, then the process will move straight to the next step as the Offer becomes a firm and binding agreement as soon as it is accepted.

Each condition in the Offer will have a specified deadline by which it must be either fulfilled or waived. If the condition is not fulfilled or waived by this deadline, then, depending on the language of the condition, the Offer is terminated and the parties walk away from the transaction.

For a Buyer, fulfilling or waiving conditions might mean confirming mortgage availability, arranging a home inspection or other inspections, or securing a sale of their existing home. While less common, the Seller may also have conditions to be fulfilled or waived, such as securing a purchase of a new house for themselves, or obtaining a Certificate of Appointment as Estate Trustee.

After all conditions in the Offer are fulfilled or waived, the Offer becomes ‘firm’, meaning that it is no longer conditional and becomes a binding agreement to purchase the property, and the purchase process moves to the next stage.

3. Completing the Due Diligence Process

Once the Offer becomes a firm agreement, the Buyer’s lawyer will commence their ‘due diligence’ inquiries; if the Buyer’s lawyer was not involved in drafting the Offer, then this is typically when they will get involved.

Among other things, during this stage the Buyer’s lawyer typically:

  • examines title;
  • verifies there are no outstanding liens affecting the property or the Seller;
  • makes inquiries to confirm that taxes are fully paid; and
  • arranges title insurance.

In the event that anything unexpected arises during these inquiries, the Buyer’s lawyer will then look for resolutions to the issue discovered. This often means either contacting the Seller’s lawyer requesting the issue be corrected, or contacting the title insurance company (if any) to obtain coverage over the problem for the Buyer.

4. Closing the Deal

Finally, the parties will begin preparing for closing of the purchase. Shortly before the closing date, both the Buyer’s lawyer and the Seller’s lawyer will met with their respective clients to sign closing documents. During this meeting, the lawyer typically reviews any problems that have been raised and discuss how they were resolved, and reviews and explains any closing documents to their client before signing.

On the closing date, the lawyers will exchange their client’s respective closing documents, send closing funds, and finally, register the transfer electronically with the Land Registry Office, officially transferring the property from the Seller to the Buyer. If the Buyer has arranged a mortgage, the Buyer’s lawyer will also register the new mortgage on title to the property after the transfer.

Shortly after the transfer is registered, the parties should expect to receive a call or email from their lawyer’s office, confirming either that the property is now officially theirs, or in the case of the Seller, that the property has officially been sold, and letting them know that either keys or closing funds, as applicable, may be picked up. After this, the only thing remaining will be the final written report confirming details of the purchase or sale, which typically arrives in the weeks following the completion of the transaction.


Buying a house is exciting, however it can very quickly become a complicated and stressful process. Involving a real estate lawyer early on in the process will increase the chances that your purchase will run smoothly and reduce the likelihood of headaches down the road.

Whether you are buying your first home, upgrading to a new bigger home, downsizing to a smaller home, purchasing an investment property or a camp property, or you are selling, our experienced team of real estate lawyers at CARREL+Partners LLP is here to help guide you every step of the way. Get in touch today.

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This publication is for general information purposes and is not to be taken as legal advice. The information within is current only to the date of publishing. If you have any questions regarding article content, please contact the author(s) directly.