Alarming trend: Canadians are finding themselves unable to follow through on pre-con real estate purchases. So, what happens if you can’t close on a pre-construction real estate deal?
In this episode, the co-founders of Hoyes Michalos break down the reality of pre-construction deals in Canada, including assignment sales, how rising rates and blanket appraisals impact your deal, and what happens if you can’t secure financing. They also explore the legal and financial consequences of “walking away” and whether solutions like a consumer proposal or bankruptcy might apply to your situation.
Walking Away From a Pre-Con Deal with Consumer Proposal
What To Do When You Can’t Close
The Real Problem with Pre-Con Deals by Doug Hoyes LinkedIn
(0:00) – What is a pre-construction deal in real estate?
(3:30) – What is an assignment sale?
(5:15) – Trends in Canadian pre-construction real estate deals
(8:00) – “Blanket appraisals” and why they matter
(11:45) – The financial and legal consequences of “walking away”
(13:00) – Timing issues and pre-con purchases
(14:00) – What happens if interest rates go up or down before your closing date?
(17:00) – When builders run into problems — how it affects you
(20:00) – Practical steps if you can’t close on your pre-construction home
(22:00) – Can a consumer proposal help you walk away from a pre-con deal?
(26:00) – Are you at risk of being sued by the builder?
(28:00) – Bankruptcy: when it becomes an option for pre-construction buyers
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