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Town needs to rethink development charge policy I could not believe what I was reading in Chris Simon's comment (Dec. 5). I have practised real estate law in Innisfil for close to 34 years and can quite easily say that Simon has missed the point when he says "It's unlikely that many homebuyers are going to back out of a purchase simply because development charges increase by about $20,000." Take it from someone who has been there that any increase in price, that has not been budgeted for, causes severe problems to those who have scraped and saved to get their deposit together only to find that they then have to face legal fees, disbursements and the Provincial Land Transfer Tax. In many cases, deals collapse because of $1,000, let alone $20,000. The problem arises in the new home construction industry. A buyer enters into the agreement of purchase and sale long before the house is even started and sometimes waits years for the house to be built, a fact which is not always the fault of the builder. Contained in the fine print of the agreement is a clause which provides that any increase in development charges may be passed on to the unsuspecting buyer. This unsuspecting buyer has already arranged a mortgage and budgeted for the downpayment and (hopefully) the closing costs and has no room for an additional $20,000. The mortgage lender will not likely come up with any more money, the builder, naturally, passes it on, and so who pays? The buyer, if that is possible. I think that it is safe to say that close to 100 per cent of those buyers will have to walk away from their deals possibly losing their deposits and facing a legal bill for the work already completed by their lawyer.
Hopefully, our town council will provide some relief to this new home buyer and not destroy their dreams, even if there has to be an increase in the development charges. This could, for example, come in the form of grandfathering all existing agreements of purchase so that the builder does not have to pay any increase for those houses already sold. |
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