Here’s a question that comes up from time to time when working with buyer’s, often enough to make mention of it here. The standard Residential Purchase Contract does not contain a clause which gives the Buyer a right of access to the property until the Seller’s lawyer tells the Seller the keys are releasable, and only at the agreed upon time. A walk through by the buyer and their Associate prior to possession is a privilege, not a right. Any access to the property prior to that point is 100 per- cent at the discretion of the Seller.
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Buyer’s lawyers who set an expectation with their clients that they have a right to a walk through because of “common practice” are misleading their clients”. (Calgary Real Estate Board – March 9th, 2007) While a walkthrough may once have been common practice, it is certainly not an entitlement. An exception is when it is inserted as a term in section 7.6 of the Standard Real Estate Purchase Contract at the time of negotiations, and agreed to in writing by all the parties to the transaction.
Otherwise, the Sellers may well refuse your request as it usually comes at the worst possible time, with no notice, when their home is in disarray and they are scrambling to meet their move-out deadlines.
Walkthrough or not, unless the property has been partially destroyed, it will not affect the ability for the parties to close. There are typically no provisions in the contract, other than what is already provided for, and no recourse other than what is already provided for under the law. The buyer’s lawyer has no authority to hold-back funds based on the findings of walk-through.
That being said, if the buyer still wishes to wishes a walkthrough prior to possession it should be brought up during negotiations so that it can be written into the Purchase Agreement.
If you are considering a purchase or sale of real estate in Calgary, please call.
Self-Built Homes may be considered an Intrinsic Defect
Self-Built Homes may be considered an Intrinsic Defect
I was speaking with Heather Wytinck, Business Development Manager with the Optimum Mortgage Group last week and they were explaining to me that under their No-Income-Qualifying mortgage plan, homes which do not qualify for mortgage funding among others would be self-built homes.
While it probably remains to be tested, or at the very least is a rare occurrence, the existence or knowledge that a home was self-built must be disclosed to all potential buyers. In the event that there are problems down the road, any failure to do so would almost certainly leave the seller open to serious recovery claims plus punitive damages as a result.
When in doubt, it is always best to disclose. This disclosure should be made in each and every subsequent trade of the home. Buyers don’t seem to mind much when things like this are brought to their attention in advance. Then they can deal with it. It’s only when they are surprised at a later date that they can become really upset.
Mike Leibel - 403-204-1111