Due to the global pandemic and rising interest rates and construction costs, more pre-construction projects are experiencing delays or even cancellations. Here’s what you can do as buyers to protect yourselves:
1. Check Your Tarion Critical Days:
For pre-construction condos, there should be either a Tentative Occupancy Form or a Firm Occupancy Form.
For the Tentative Occupancy Form, tentative occupancy dates can be changed by the developer depending on the construction status, as long as the developer sends out advance notices that meet Tarion’s requirements.
The Firm Occupancy date should be the final property delivery date ready for occupancy by buyers. If possession cannot be completed by the Firm Occupancy date, buyers have the right to request delayed occupancy compensation at a rate of $150 per day, up to $7,500 per unit.
The Outside Occupancy Date is the final deadline for property possession. If the unit still cannot be occupied by the buyer, the buyer would be entitled to terminate the transaction within the following 30 days, with fully refunded deposits, plus interest and delayed occupancy compensation.
It’s important to note that some delays may be considered unavoidable due to global events, such as the COVID pandemic, natural disasters, wars, etc. Therefore, not all delays will be compensated.
2. Bring Your Agreement of Purchase and Sale (APS) to Your Lawyer for Legal Advice:
Clauses and conditions that may cause delays will help you understand your position and what can be done to avoid further confusion and protect your interests. Your lawyer should also ensure that the developer complies with the executed APS and Tarion rules from a legal perspective.
