I heard about this story Friday the old fashioned way: someone my wife works with is a buyer and is understandably unhappy with what’s happening. Based on what my wife told me this thing looked all wrong. I won’t comment on the legality of it – I’m sure that will come out in the fullness of time. However, it appeared on this blog this morning as a comment on an unrelated thread and I think it deserves its own ink.
What is it? Pretty simple. Pre-sale is made, buyers begin waiting for dream home, then get informed that everything is going south. Of course, the buyers were operating in good faith and have made commitments and are likely to suffer great losses.
I’m not the only non-buyer to think that this stinks. The Greater Vancouver Homebuilders Association is also giving it a thumbs down. The simple solution is specific performance, of course, but will we see that?
What other issues are there? If the selling agent is the wife of the developer, there are certainly agency concerns. Forewarned is forearmed/caveat emptor, etc. Read the agency brochure (there’s a link here), and understand who’s doing what for whom. Be aware of the differences between buying a pre-sale and buying an existing property from an individual using standard MLS forms. There is a lot of fine print in MLS stuff, but its there for a reason and the standardization offers the consumer a degree of protection.