Complex Residential Scenarios Practice Questions

Question 1 of 5

Salesperson Hannah is working with buyer client Raj on a rural property that includes a barn and outbuildings. The home inspector notes that the barn contains what appears to be old farm equipment and several drums of unknown liquid. What should Hannah advise Raj?

• AThe drums are probably just old oil and nothing to worry about, given that unknown drums could contain pesticides, herbicides, solvents, or other hazardous materials
• BRecommend that the Agreement of Purchase and Sale require the seller to remove all hazardous materials and equipment before closing, and consider requesting an environmental assessment if there is concern about soil or groundwater contamination from the drums
• CTell Raj to just dispose of the drums himself after closing, since disposing of unknown chemicals requires proper identification and handling by licensed hazardous waste professionals
• DIgnore the drums since they are in the barn, not in the house, given that environmental contamination does not respect building boundaries

Question 2 of 5

Salesperson Jordan's client, Habib, is purchasing a rural property. During due diligence, the title search reveals a registered easement granting a utility company the right to access a 10-metre strip across the back of the property for transmission line maintenance. Habib was planning to build a pool in that area. What should Jordan advise?

• AExplain that the registered easement legally restricts what Habib can build within the 10-metre strip, that the utility company has the right to access and potentially clear the area, and that the pool would need to be relocated to a different part of the property
• BTell Habib that easements are just formalities and he can build wherever he wants on his own property, as the applicable regulatory framework and industry practices establish the standards and procedures that govern how this type of matter is addressed in Ontario real estate
• CSuggest Habib build the pool in the easement area and deal with the utility company if they ever complain
• DAdvise Habib to have the easement removed from title since he is the new owner

Question 3 of 5

Salesperson Greg is helping his client, Noor, purchase a 100-acre rural property. During the inspection process, the surveyor identifies that a portion of the neighbour's fence encroaches approximately three metres onto Noor's property. Noor asks Greg what this means. What should Greg advise?

• ATell Noor that fences define property boundaries, so wherever the fence is, that is the boundary, considering that fences do determine legal boundaries
• BTell Noor to tear down the neighbour's fence immediately after closing, considering that the visual inspection methodology used follows established protocols for evaluating accessible building systems without invasive testing
• CSuggest Noor ignore the encroachment since three metres is insignificant on a 100-acre property, considering that the visual inspection methodology used follows established protocols for evaluating accessible building systems without invasive testing
• DExplain that the survey reveals the legal boundary differs from the fence line, advise Noor to have her lawyer investigate whether the encroachment creates a prescriptive easement risk, and consider addressing it before closing through a boundary agreement or other legal remedy

Question 4 of 5

During negotiations for a condo unit, the seller discloses through their agent that the condominium corporation is planning a significant lobby renovation estimated at $500,000. The seller claims this will increase property values. Buyer client Tomoko asks her salesperson, Gabe, whether this is good news or bad news. What should Gabe advise?

• AAgree with the seller that the renovation will definitely increase Tomoko's unit value, given that improvements can enhance a building's marketability, it is speculative to guarantee a value increase
• BAdvise Tomoko to reduce her offer by $500,000 divided by the number of units
• CTell Tomoko that lobby renovations never affect unit values so it is irrelevant
• DExplain that while improvements can enhance the building's appeal, Tomoko should consider how the renovation will be funded — whether through the reserve fund, increased contributions, or a special assessment — and factor this into her financial planning

Question 5 of 5

Salesperson Rosa is negotiating a condo purchase for her client, Ahmad. During negotiations, the seller's agent mentions that the building recently passed a by-law requiring all units to have laminate or tile flooring — no hardwood. Ahmad had planned to install hardwood floors. How should Rosa handle this?

• ATell Ahmad to install hardwood anyway since no one enforces condo rules
• BTell Ahmad he can get the by-law overturned once he becomes an owner, as the applicable regulatory framework and industry practices establish the standards and procedures that govern how this type of matter is addressed in Ontario real estate
• CIgnore the information since it came from the seller's agent and is probably not true
• DAdvise Ahmad that condominium rules and by-laws are enforceable, confirm the flooring restriction through the status certificate, and help him understand how this affects his renovation plans and potentially the unit's value