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Nope. Closing delay penalties and outs are governed by Tarion. Act of god, fire, insurrection, pandemic.... all legitimate reasons to completely reset a new build delivery date.
So I drop 300k on a new build, it torches, and then I don’t get the deposit back? It just extends the day of closing to whenever the rebuild happens?
Desperate people will do desperate things.Burlington, lodi road. Three fires in two months. This one completely destroyed four homes under construction. Article is unclear whether previous fires were in houses under construction as well.
Who wants to bet that there is a reddit group on options if you can't afford to close?
Video shows massive fire that destroyed under-construction homes in Burlington
At least four under-construction homes in Burlington, Ont. have been destroyed after a structure fire early Monday morning.toronto.ctvnews.ca
At least the collingwood one had on site security who called it in as soon as they noticed and they still lost a bunch of units. If pace picks up too much, insurance is going to start to get grumpy. Each of these fires is close to seven figures at the bottom end.
I'm guessing most pre-build buyers would gladly accept a year's reprieve on their closing right now. Financially it's a big win for the buyer, particularly those with condo purchases. It gives them time to save if they have become unqualified for a mortgage, shortens the window where they pay occupancy fees (fire shouldn't delay the condo registration process), and with any luck interest rates will begin heading south in the next year.
Not easy to come up with comps in the area (nor exactly which units burned) but from looking at nearby properties, I suspect that buyers are locked in at 1.9-2.1M and market value is maybe 1.8-1.9. Not as big a correction as I expected but if you're 100K short, that is a huge gap to jump. What are private lending rates these days? Probably the wrong side of 15% if I had to guess. That's a tough nut and if private lender chooses not to renew, you have just punted your eviction by a year.
I'll bet the correction is a lot bigger than that. I keep a very close eye on that area, we have a place about 1km away that I've been thinking of selling. Prices on newer homes that sold for $2M at peak are in the $1.5 range today. Check Zolo -- you'll see the bigger places have several listings since the summer, most have been discounted $250K or more since August and are still not selling.
A 4000 sq ft detached on that street sold earlier this year for 1.9. Most of the delisted houses were 4000 sq ft detached not yet built for 1.9-2.1. Further north in the subdivision, detached are selling for 1.5 (i didn't check sq ft).
www.cp24.com
betterdwelling.com
Call me naive but what does burning down unfinished homes accomplish, beside giving the arsonist something to wank off to?Article on fires. Northbridge insurance has published a document warning builders about intentional development fires. The collingwood one had security guards on site who called it in right away and they still lost the houses. I won't be surprised if insurance companies force measures soon (skip every other house until enclosed and boarded, secure framed houses, motion sensors in every framed house, etc.).
Canadian Real Estate Arson May Rise As Economy Slows, Warns Insurer - Better Dwelling
The only bond stronger than a mother and its baby is the one between rising interest rates and the arson of new homes under construction. Commercial insurer Northbridge Insurance is warning home builders to look out for arsonists. In a letter this week, the firm explained they expect new home...
One of the primary theories is to delay completion and therefore closing. Potentially, buyers that can no longer get financing and will be in big trouble when the house is competed and they need to close. Combination of much higher interest rates and also maybe a much lower assessed value by the bank. I am sure some also hope it will get them 100% out of the deal... but apparently that may not be the case.
Easy way for buyers to delay / stop a project that they can't close on.
Buys you time.
If they interleave the construction for detached homes like you suggested it will likely stop the spread but I bet it will also reduce the incidences as someone can't light the home on fire beside theirs, they will need to be specific (although they may just hit a bunch to spread the suspicion).Article on fires. Northbridge insurance has published a document warning builders about intentional development fires. The collingwood one had security guards on site who called it in right away and they still lost the houses. I won't be surprised if insurance companies force measures soon (skip every other house until enclosed and boarded, secure framed houses, motion sensors in every framed house, etc.).
Canadian Real Estate Arson May Rise As Economy Slows, Warns Insurer - Better Dwelling
The only bond stronger than a mother and its baby is the one between rising interest rates and the arson of new homes under construction. Commercial insurer Northbridge Insurance is warning home builders to look out for arsonists. In a letter this week, the firm explained they expect new home...
With competent security/alarms, it's not trivial to get a number of infernos going before the fire department shows up.
So both sides can be scum bags. I guess I am not wired for that way of thinking..
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