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limitations for deficiency walkthrough?

17 years ago

Hello - My first visit to this forum, am following a suggestion from my post over on the Buying & Selling Forum to cross post here.

"new condo - deficiency walkthrough - limitations?":

http://ths.gardenweb.com/forums/load/realestate/msg022206295305.html?5

Thanks in advance if anyone could add their experience or thoughts.

Here is a link that might be useful: 'new condo - deficiency walkthrough - limitations?' thread on Buyingg & Selling A Home Forum

Comments (11)

  • 17 years ago
    last modified: 11 years ago

    I would not purchase any large item where there is ANY unreasonable limitation set on research and inspection.

    Most people would not buy something like a new car, given the limitation of a five-minute test drive (parking lot only), and an hour of internet research. I certainly wouldn't on a new home.

  • 17 years ago
    last modified: 11 years ago

    I'm neither a lawyer nor a Canadian, so I'll just comment from my own experience. If this restriction on bringing others to the walk-through is not in the contract that you signed, you are not bound by the builder's policy. Prepare to play hardball. If the contract you signed does specify no holdbacks for deficiencies, then your only course of action, that I can see, is to refuse to close until the residence is complete and free of defects and is fnished in the manner that was initially represented. Of course, if a manufacturer no longer makes a particular style of shower head or light fixture then you must accept a close substitute. But in your example, I don't find replacing a medicine cabinet with a simple mirror to be acceptable. Surely there are other medicine cabinets that will fit the space and decor.

    I've dealt with quite a few builders. All had good reputations at the time we contracted with them. Some kept their word, others did not. All of them thought I was "too picky" and most whined about being held to our contract. I will never again close on a house until I am satisfied that it's truly completed as originally intended. Once you close you have no leverage. If you think it will be a hassle to get your home properly completed now, just imagine when you are the one who has to deal with subcontractors failing to show up as scheduled, people making a mess in your home, and the disruption to your lives for who knows how long.

    Good luck!

  • 17 years ago
    last modified: 11 years ago

    In my opinion the final walk-through is NOT the time to be searching for deficiencies. At best the walk-through is rushed and the builder will be pointing out all the "great" features thereby distracting you from searching for deficiencies. Even if you were totally knowledgeable about what to look for, you should do your actual searching for deficiencies WITHOUT the builder there to distract you.

    I had a professional inspector do stage inspections on my home and even HE insisted on being left totally alone to do the inspections so he could concentrate. Once he was finished, then he walked around with my builder pointing out the issues and followed that up with a written report.

    The above means that it really doesn't matter whether the builder will or will not allow you to have a knowledgeable friend with you at the final walk-through. What matters is whether you are allowed to visit the condo BEFORE the final walk-through (bringing whomever you like with you) and take the time you need to do a thorough pre-walk-through inspection.

    If you ask whether you can do a pre-walk-through inspection, your builder may say no. But, I suspect you are probably allowed to visit and show off your unit pretty much whenever you want to so long as you and your visitors don't get in the way of the work. After all, one way buyers are found for unsold units is when those who have already contracted to purchase one show off their units to friends! So, if you're allowed to visit and bring friends, don't ask or tell your builder you are doing a pre-walk through inspection. Just take your friends to the condo a few days before the scheduled walk-through and, under the guise of showing off your soon-to-be new home, take the time you need to do a thorough inspection.

    Then, when you show up for the actual final walk-through, bring two copies of a typed up list of every single issue you and your friends previously located. If any deficiencies have been corrected in the interim between your friends' visit and the final walk-through, cross those items off the lists. Give the builder one copy and keep the other copy for yourself.

    If your builder has a form that he uses to list deficiencies and won't take your list in its place, refuse to sign his form unless/until he lists (in detail) every item on your list.

    Also, make sure at the closing that there is something in the final agreement that sets a time limit on the builder correcting the deficiencies and gives you some kind of mechanism to force him to adhere to the time limits... preferably some mechanism short of having to take him to court. That IS something about which you probably ought to talk to a lawyer in your jurisdiction - just to find out what options you might have and what the language in the final agreement should say.

    I personally would never agree to close at all unless the cost to correct all the remaining deficiencies was low enough that I could afford to pay to have someone else fix them even if I couldn't collect the money back from builder.

    The nice thing about doing a pre-walk-through with knowledgeable friends, or a hired expert inspector, is that if it turns out that there are too many deficiencies or any that would be expensive to repair, you can cancel the walk-through and tell the builder you will reschedule it after he has corrected those deficiencies.

    Good luck

  • 17 years ago
    last modified: 11 years ago

    Sorry, but I get that red-flag-waving feeling for both issues.

    While the "tour director/realtor" or whoever is accompanying you might wish to limit the tour to owners and spouses, I really don't see any way for them to enforce that... what are they going to do, demand to see your marriage licence? And, ah, the real owners can take whoever they damwell please to view whatever they own. And if the seller wants to limit tours or inspections only to sure buyers, someone better tell the seller that most real buyers aren't dumb enough to buy a pig without inspecting the poke first.
    The very fact that they want to place this restriction would cause me to invest in the best building inspectors I could find... because that red flag says that good builders don't want to hide their work OR prevent other professionals from seeing what's been done. Keep in mind that you aren't the real owner until you've bought the place, but also keep in mind that possible defects are possible, and it's your responsibility to find any defects, and you should not expect the seller to show defects to you. Buyer beware is more than a clich

    The other issue is regarding holding back money until work is completed. Read your contract. We would all like to think our builder is honorable enough to fulfil the contract right down to fixing the last chipped paint, but reality says that all too often the only way to get a builder to actually finish all the little thingies is have most of his profit in your hand. And the only way you can hold that profit is if your contract specifies (in any of several legal terms) that YOU must agree that the house is completed before the final monies are released to the builder. The red flag is that few new buyers realize that most contracts favor the builder... the house is done and the money owed whenever HE says it is done, not when the all those tiddly items are off your checklist. This is why you should never sign a contract without letting a good and knowledgeable lawyer [yours] read all the fine print.

  • 17 years ago
    last modified: 11 years ago

    Hmm; only time for quick reply.... is all this the same for new condo as for new detached house? We've already "bought" the condo. The contract re closing date that we already did sign does say no holding back for deficiencies. Our realtor acted for both the developer and us; it didn't occur to us at the time to ask otherwise. I think all or almost all the units are already sold.

    The things WE can think of are relatively minor but are disappointments to the whole feel/function... it'll be nice to see if we can learn why the changes/omissions occured. We'd prefer constructive collaboration than hard-nose bottom line misinterpretations that prompt them to quickly install inferior items in suboptimal places.

    We have managed to get to see the place a few times and tried to identify as much as possible, but are not welcome to go in by ourselves at any time, let alone bring friends. Though the hard-hat stage seems past, there are lots of workers doing this & that, and for security reasons I appreciate them not letting just anyone wander around. It's not been completely easy (again, probably partly due to our inexperience in the field) to figure "who's the boss of what" or where some communications do/should go.

  • 17 years ago
    last modified: 11 years ago

    Read the contract wording about the walk-through very carefully. Not commenting on deficiencies during a walk-through should never be considered relinquishing any of your rights as the owner or void the obligation of the builder to build according to the contract documents (if you don't have an adequate set of documents that is another matter entirely).

    Don't sign anything, make it clear that you are not "approving" or "accepting" anything and then have an inspector look at it later if you are concerned. I suspect it is just a game to intimidate you. Realistically, what could even an experienced person see in a simple walk-through anyway? Would you be expected to carrying an electrical receptacle tester, a light to check the wall finish and a level for the door jambs?

    Walk-throughs are a lot like an adult snipe hunt. They may know more than you but its your money, your house, and you alone must be satisfied with the quality of the work before during and after the big "walk-through" event.

    On my first major project I was checking the location of the plumbing chase in one of 350 apartment units and my boss told me to put the tape away because it was the builder's responsibility to check the work, not ours, and he didn't want anyone to claim otherwise.

    If they hand you a burlap bag give it back.

  • 17 years ago
    last modified: 11 years ago

    "Walk-throughs are a lot like an adult snipe hunt."

    We actually have a season on snipe in Virginia.

    They are not hunted at night though.

    Here is a link that might be useful: Snipe

  • 17 years ago
    last modified: 11 years ago

    Never feel you have to apologize for enforcing the terms of a contract. In addition to signing it, they probably wrote it.

  • 17 years ago
    last modified: 11 years ago

    Yeah, I can see where your ability to wander around freely might be a bit different with a condo than a detached house.. although even then I think you should be fairly free to come/go once the hard-hat stage is passed.

    I've personally never had any desire to live in a condo but when a friend was thinking of buying one, the two of us walked thru at least a half-dozen partially built condos. We would just drive up, say hello to the first workman we saw, and ask if it would be all right to look around b/c my friend was thinking of buying a unit. Occasionally the workman would holler for a supervisor's okay but we were never told "no."

    Also, I guess I didn't understand that you had already "bought" the condo. Seems to me like the contract was sort of like a "special order" purchase and, around here anyway, if you order something "special order" you do have to pay for it (no returns) BUT ONLY if it is delivered to meet your specifications. If not, you don't have to take it and you sure don't have to pay for it. That applies to everything from decorated birthday cakes, to hand-sewn bridal dresses, to custom automobiles. Sure seems like it ought to apply to condos also!

    A contract for a condo still to be built that has a clause effectively saying that the buyer has to pay fully regardless of how deficient the finished condo is would be considered so unfair as to be void from the get-go! For sure, it is a contract that no one ought ever to sign. Under those terms, it sounds like they could tell you the condo is "done" and expect you to pay for it even if it hadn't been painted and had only 2 bedrooms instead of three and half the windows wouldn't open. After all, they could argue that they had delivered a "condo" fit for living in and that all those issues were mere deficiencies!

    Hopefully they won't pull anything quite so egregious - but if they are leaving out items like the medicine cabinet that are specified in the contract, they are doing exactly that albeit to a lesser extent that just deciding not to paint the walls or to give you one less bedroom that called for!

    On the other hand, if the reason you think there is supposed to be a medicine cabinet is because you saw a medicine cabinet in the example condo that you visited - but there is nothing in your contract about one - then they are pulling the kind of maddening "bait and switch" techniques that many home builders pull. That is, they put all kinds of "upgrades" in the show units they build and buyers think they're going to get the same house but instead get a totally stripped down version.

    Go through your signed contract carefully and figure out what it really SAYS you are supposed to get. Additionally, whoever signed that contract is an agent for the builder and has the authority to "bind" the builder. So, as a starting point, contact that person and generally detail your concerns regarding the condo. Tell them that you realize they may not be the correct person for you to be talking to but, since their name is on the contract, you figure they ought to be able to put you into contact with the correct person at the company who can address your concerns. Once they give you a name, ask them if they'll be so kind as to pick up the telephone and call the person and introduce you to them and generally give them a heads-up about the issues you want to discuss with them. That way, you're much less likely for person #2 to give you a run-around and tell you they're not the person who can help you after all.

    If this procedure fails, there is no point in ditzing around with low level company employees any longer. Look up the company's CEO (chief executive officer) or president and contact them directly. Outline your concerns to them. Let them know that in general you are still pleased with the condo but that there are some things that do not appear to have been done according to your contract. Point out also that you want an opportunity to have someone knowledgeable that you trust inspect the condo before your walk through and that you're being told you won't be allowed to do this... even though there is nothing in the contract to that effect.

    If the president/CEO doesn't immediately contact the site supervisor and tell him to get your condo up to specs AND to allow you to being in an inspector of your own choosing, then you very need to see a lawyer because, trust me, your problems with that condo are only just beginning.

  • 17 years ago
    last modified: 11 years ago

    Thanks again for all your input... so appreciated at this stressful time; sorry I'm not making it back here for frequent updates... will aim to at least come back with a final "how it turned out".

    Unfortunately there wasn't a display suite at sale time - would have been an extra expense they deemed not needed to accomplish sales. They somehow didn't even muster an exact sample of the cabinet style, such that we ended up with a surprise version within our choice. They eventually did have colorway panels for choices, and did allow a degree of changing around which was nice... though that seemed to create a bit of confusion with some errors that ate up extra time to sort out. From the beginning there were a brochure and "feature sheet" with mockup pics (not guaranteed to be exact since they were done way ahead of finishing details)... the sales pitch stuff that we relied on.

    Bevangel's comments above: "In my opinion the final walk-through is NOT the time to be searching for deficiencies. At best the walk-through is rushed and the builder will be pointing out all the "great" features thereby distracting you from searching for deficiencies. Even if you were totally knowledgeable about what to look for, you should do your actual searching for deficiencies WITHOUT the builder there to distract you." This makes sense to us... they are actually calling the walk through the "builder orientation/walk through", to sound less negative than "deficiency walkthrough" - another surprise as within their stated 1 hour limit we didn't anticipate having to cover off orientation. They did however "concede" to "allow" us a professional inspector (saying not friends/others however)... we hadn't thought of doing that until they (& some of you) suggested it, so we'll indeed have a professional inspector before the builder walkthrough. At least that alleviates our anxiety at having to come up to speed with a bazillion technical things.

    There are some reasons to make us think that overall things will be ok, but on the other hand we've gone from feeling like valued prospective residents, very confident about the building and high end detailing to feeling like "a troublesome unit for them to contend with", and some things just truncated at the end to reach the finish line (or omitted without disclosure as to reasoning). Hopefully it's just elements of poor communication and human misinterpretations that will not remain obstacles... we are awaiting clarification of some things before walkthrough, as we thought it was courteous and sensible to address ahead.

    Thanks again for taking the time to comment!

  • 17 years ago
    last modified: 11 years ago

    I didn't realize you were in Canada at first. You may find the link below helpful. I also would not buy from a builder who forbade use of my own experts, but it sounds like that's advice that comes too late in your case. Good luck!

    Here is a link that might be useful: Canadians for Properly Built Homes