When you are buying a new home from a Builder, you may be required to complete the final grade or landscaping. Here is an explanation of some terms that you should know.
Rough Grade Approval: Usually this is applied for by your Builder once backfilling of the foundation walls and shaping of the lot is completed according to the Surface Drainage Plan. The lot is surveyed by a land surveyor, architect, or professional engineer who prepares a Plan of Certification of As-Build Grades/Lot Grading Certificate. It is submitted to the City and the City will conduct a lot grading inspection. If the lot is graded properly, the City will issue a Rough Grade Approval. You cannot start your landscaping or install things like a shed until the Rough Grade Approval is obtained.
Final Grade Approval: The Final Grade Approval is usually applied for after the Rough Grade Approval. Sometimes the Builder provides the Final Grade Approval, but most times it is the Buyers responsibility. The application for Final Grade Approval is made once the lot is graded to where the final product needs to be placed. The City will conduct an inspection and issue a Final Grade Approval. It is your responsibility to maintain the surface grade of the property forever. The City may require maintenance or repairs on the lot grading if any changes or settlements result in surface drainage problems.
Sometimes buyers get the Plan of Certification of As-Built Grades confused with the Real Property Report. The Real Property Report is a survey of the property that shows the location of visible improvements (for example, a house, garage, deck, or fence) on the property relative to the property boundaries. The Real Property Report is then submitted to the City to be reviewed for compliance.
Landscaping Deposit: If you are required to complete the landscaping to the property, you may be required to pay a deposit to your builder which you will receive back once the landscaping has been completed according to the guidelines applicable in your subdivision. An inspection will be done to ensure to the guidelines were followed before the deposit is released to you.
Seasonal Holdbacks: Sometimes the weather and change of seasons may prevent your Builder from completing certain items prior to your Possession Date. For example, the driveway can’t be completed because of frost and will have to wait until the following year. In this case, an appropriate amount from the purchase price is ‘held back’ and placed in trust with the lawyer. The seasonal holdback funds are not released until the item is completed.
You should review your Purchase Agreement and discuss with your Builder things like whether you will be required to obtain the Final Grade Approval, a Real Property Report with compliance, whether you will be paying a landscaping deposit, seasonal holdbacks, and timelines to complete these items.
This article applies to City of Edmonton procedures which change all the time. You can visit City of Edmonton Website for info on Residential Lot Grading. Other Alberta municipalities may have different or similar procedures.