This is another story in the media about Buyers losing money when dealing with preconstruction buildings.
As the article states (not proven in court yet), Boss Luxury Towns was a 72-townhouse project in Richmond Hill. The builder was operating without a license and so the project was cancelled.
Unfortunately, only $100k of the deposits are “protected” and so some Buyers may potentially lose up to $150k when the receivership process is completed.
You can read more details about the case in the link below, but here are 3 main takeaways:
1. Only deal with reputable builders
This builder entered into agreements without even having a license and wasn’t registered with Tarion Warranty Corporation.
2. If it’s too good to be true, it probably is
Buyers were offered a $200k discount if they gave a $250k deposit.
3. Use a professional
Whether it’s a lawyer to review the paperwork or a real estate agent to research the builders, dealing with knowledgeable professionals will keep you out of trouble.
In the article, the lawyer said, “Look, there’s something wrong here. You’re getting incentivized to produce a large deposit, which is not secured, on the idea that you’re getting a discount.”
Who can say whether the government will step in with more regulation? But in this case, it seems that the builder was illegally selling the development anyway, so maybe it wouldn’t matter.
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