New Construction snippet
When my clients are interested in new construction I always remember my Managing Broker’s mantra when it comes to the final walk-through inspection.
This final walk-through inspection is conducted before the Buyers take possession of the new place. It should provide assurance that everything in their new home will be properly done and finished by the time possession date rolls around. Unfortunately reality is often different and there might be a number of deficiencies that need to be corrected.
Here comes the importance whether the Contract of Purchase and Sale has an appropriate walk-through inspection clause such as the one recommended in the Professional Standards Manual (PSM) or we are stuck with the watered down version that are usually found in the Developer’s contract.
The devil is in the details. The PSM version assigns a monetary value to each and every outstanding deficiency and provides a hold back for their accumulative repair cost upon completion. The Developer’s version usually provides a promise that everything will be done by completion but no real recourse if the deficiencies still happen to exist at that time.
While the more significant defects will be covered by the New Home Warranty Insurance smaller ones –regardless how annoying they are- don’t measure up to trigger warranty coverage under the BC Residential Construction Performance Guide. In my experience, reputable Developers will take care of such issues but this is still a risk that the Buyers should be aware of.