We’re living in challenging times. The COVID-19 pandemic has impacted the way we work, get around the city, and enjoy one another’s company. If you or someone you know has been personally affected by the virus, my heart goes out to you.
When it comes to real estate, many buyers have been caught in the middle. If you’ve recently purchased a pre-construction condo in Toronto in 2020 and are now unsure what the future holds, you know what I mean. Here, I’d like to take a moment to address some of the concerns you likely have.
If you recently bought a pre-con unit and are wondering how COVID-19 will impact the process, here’s what you should know…
The current situation
Federal, provincial, and municipal governments have all taken action to halt the spread of the COVID-19 virus. That includes directing citizens to practice social distancing—a move that has changed how we do business in real estate.
Those of us who feel a strong sense of responsibility to our community are making our client interactions—and the buying process—safer. If you’d like to know about the steps I’m taking, please don’t hesitate to ask. That said, it’s not just about finding solutions for those who need to enter the market now.
There were many transactions in progress when the pandemic began, and some buyers have been left scrambling to figure out what it all means for them. In particular, those who have purchased pre-construction units (which have longer timelines to close) may be concerned. If you fall into this camp, you should be aware of the latest developments that could impact your closing.
The provincial government has deemed construction to be an essential business, which means there are still sites open in Toronto. Having said that, the pandemic will very likely lead to unavoidable delays for many builders.
From potential work stoppages to material shortages, a variety of issues could interrupt timelines planned prior to the current crisis. For this reason, Tarion has issued an advisory to warn buyers about the possibility of setbacks. For reference, unavoidable delays are allowable under a provision in the addendum attached to your Agreement of Purchase and Sale.
If your unit won’t be completed on time, the builder will need to supply you with a notice that describes the nature of the unavoidable delay and an estimate of how long it will last. Once the pandemic is declared to be over, there may be another delay related to the disruptions it caused. If this is the case, you’ll receive a second notice.
At a time like this, meeting certain deadlines isn’t just challenging—it’s impossible. For this reason, the City of Toronto has issued an emergency order suspending statutes, rules, regulations, and bylaws that contain time limitations. As a result, Tarion has suspended all warranty-claim submission deadlines.
Of course, unit owners can still make claims anytime—they simply won’t be rejected if the standard deadline is missed. The same is true of the 30-day period you would typically be given to request a conciliation. These deadlines will be suspended retroactively from March 16th—and remain that way until the emergency order has been lifted.
A pre-delivery inspection (PDI) would usually happen before closing, with both the builder and new homeowner present. Tarion announced on March 16th that a builder could (for the time being) conduct a PDI and complete the necessary documentation for owners, who were advised to also carry out their own assessment as soon as possible after occupancy.
More recently, the non-profit corporation updated its position, stating that inspections (along with requested conciliations) will be rescheduled for the earliest possible time after the emergency order is listed.
The bottom line
During this time, try to be patient as builders work to overcome unavoidable delays. Remember that the COVID-19 pandemic is creating unprecedented challenges for Toronto’s construction and real estate industries. A little understanding will go a long way. Lastly, don’t forget that a beautiful pre-construction condo—one that’s built to last and tailored to your taste—will be well worth the wait!
Ready to buy a condo? I can answer all of your questions about the process—and help you find the perfect property. Call or text me at 416-500-5360, or send me an email at email@example.com and ask away!