Standard Agreements of Purchase and Sale in residential real estate transactions are skewed in favour of vendors – as such, it is imperative that home purchasers’ consult with a lawyer to review contracts in advance of signing in order to avoid a real estate dispute.
Ignoring the legalities of Agreements can lead to harsh consequences for buyers or sellers that want out of a deal. When you are purchasing a property, the purchaser is accepting title subject to restrictions that have been registered on title. For instance, the parking of commercial or other vehicles may be prohibited on your driveway. If you work for a trucking company or have a boat, you may then be unable to park it on your newly purchased driveway.
When markets are soft or falling, as experienced in mid-2017 in Toronto, the terms of an Agreement of Purchase and Sale take on more importance, as purchasers may want to back out of deals. We recently advised a vendor client to add specific provisions to her Agreement of Purchase and Sale, as the client was skeptical as to whether the buyer would be able to close the property on the closing date. Accordingly, the Vendor retained the right to “sell the property to another party if offered a price satisfactory to the buyer before the closing date herein.”
The above-noted provision permitted the vendor to continue shopping the property in case the original vendor did not close the deal. Ultimately, the first buyer did not close on account of a failure to sell their own residence in time – but our client had already lined up an alternate buyer because the house remained listed and on the market.
Various strategies can be employed by vendors or purchasers to real estate transactions to protect their rights and obligations. If you require assistance in negotiating a purchase and sale or handling a real estate litigation dispute, please feel free to contact Goldstein Law Firm.