Some buyers who bought buildings in a development in Stayner, Ont., years ago are furious and are calling for government intervention after they were told they would have to pay more than $175,000 more than what was agreed in contracts with the developer before their houses finally arrive. be built
CBC News has spoken to several people who have bought homes in the Ashton Meadows development, about 125 kilometers north of Toronto, who say in recent weeks Briarwood Development Group has told them they have to pay more to build the their homes, or sign. a mutual release agreement, lose their homes and get their deposits back.
Briarwood maintains that the sudden price increase is due to supply chain issues along with high labor and material costs related to the COVID-19 pandemic. The company said in a statement that it has been “navigating these challenges and trying to find constructive ways forward.”
The buyers, however, insist they are caught up in a case of corporate greed and say the Ontario government needs to do more to protect people in their position. While Premier Doug Ford previously said the province would step in to help shoppers in situations like these, experts say the government hasn’t done enough.
“I feel like they’re trying to strong-arm me and I have nowhere to turn. I have no one,” said buyer Jennifer LeFeuvre, who put down a deposit on a house with her husband in 2019, before the pandemic.
“I can’t even work at my job because of this. These people are getting away with murder and there’s nothing I can do.”
LeFeuvre originally bought her home for just over $605,000, with a deposit of more than $62,500. He said the initial closing date was to be Aug. 31, 2021, but Briarwood began sending delay notices during the pandemic.
Briarwood Development Group says the COVID-19 pandemic has caused significant problems for developers, stemming from supply chain issues and rising labor and material costs. (Doug Husby/CBC)
In early May, LeFeuvre received a notice from the company informing her that her house would still not be finished by 2022. She was offered a mutual release where she could break the contract and get her deposit back . LeFeuvre didn’t sign it: she and her husband just wanted to build their house.
In July, the couple was summoned to a meeting with Briarwood. LeFeuvre said they were presented with two options: either pay an additional $175,000, nearly three years after they initially signed their contract, or sign a mutual release form.
“Basically what they were telling us is they don’t want to sell us this house. They want to sell it to someone else for this new price,” he said.
“At that point, all I could think was, ‘We’re not signing anything, we’re taking it to a lawyer.'”
The developer says the pandemic is “devastating” for the industry
Buyer Dennis Williams, who originally bought his home for just under $787,000, said he ended up in the same boat. She received a notice from Briarwood about a week ago to pay an additional $175,000 for her home in the development, or to sign a mutual release form and get her more than $77,000 deposit back.
“They’re ambushing people,” Williams said.
“This is 100% a capital grab.”
In an emailed statement to CBC News, Briarwood spokeswoman Svitlana Mandrus blamed the pandemic, saying it has been “truly devastating” to the development industry.
“Like many developers, we’ve been navigating these challenges and trying to find constructive ways to move forward,” Mandrus said. “This has included having ongoing good faith discussions with homebuyers.
“We have always been and always will be committed to treating our partners and customers with the utmost respect and courtesy as we work with them to resolve the many challenges that have arisen since the pandemic.”
Toronto real estate lawyer Bob Aaron says the province needs to do more to protect buyers in situations like these. (Farrah Merali/CBC)
Toronto real estate lawyer Bob Aaron told CBC News he believes developers are using the pandemic as an excuse.
“We just have a bunch of greedy developers,” he said.
“And why does this happen? Because the government allows it.”
Province vows to crack down on ‘bad actors’
In November, Premier Doug Ford denounced similar practices involving a condo development in Barrie, saying developers should bear the cost of price increases if they have already signed contracts and agreed on a final price.
He pledged to end the practice “because it is totally unfair”. When asked again about the issue at a press conference Friday, Ford said he has “zero tolerance” for developers who balk at the fees.
“We will continue to monitor it and make sure they are not allowed to go there and pull the rug out from under them. [buyers]” Ford said.
Briarwood has offered affected buyers the option of signing a mutual release agreement, where they would lose their homes but get their deposits back. (Doug Husby/CBC)
When asked what measures the province has put in place to protect shoppers, Ministry of Public Services and Business spokesman Matteo Guinci said in an email that Ontario is cracking down on “bad actors” and will defend future ones owners of “unethical and egregious” practices, such as canceling projects prior to construction.
Guinci said the province has introduced a mandatory code of ethics for builders and sellers and has taken steps to protect consumers, including the possibility of Home Building Regulatory Authority (HCRA) fines of 50,000 to $100,000 to developers, with the possibility of additional fines. at the top
“We unequivocally expect all builders to operate in a professional manner with fairness, honesty and integrity to consumers,” Guinci said.
In a statement sent to CBC News on Monday, HCRA spokeswoman Tess Lin said the organization “cannot comment on ongoing matters at this time related to Briarwood Homes/Briarwood Development Group,” but said that the authority “is aware of these concerns and [is] investigating the matter.”
The authority’s website does not list any orders, disciplinary activities, charges or convictions linked to the numbered company listed as the seller in the documentation provided by the homebuyers in this story.
The HCRA was launched in February 2021, with responsibility for licensing and supervising about 6,000 developers and builders in Ontario. The agency says it responded to more than 600 complaints in its first year of operation.
Fines too low, says lawyer
Aaron, the real estate lawyer, said the province’s ethics code is poorly defined and does nothing to protect consumers in situations like these, calling penalties of $50,000 to $100,000 a “permit license” that equals the cost of doing business for developers.
“These charges are so low that they don’t put anyone off for anything,” he said.
“Ontario homebuyers deserve better … the government is failing to protect consumers.”
Meanwhile, people like LeFeuvre are left in limbo and facing a legal process that could take years, all the while without their home being built.
He said he voted for Ford in the last provincial election, partly because of his stated support for Ontario workers.
“Now, will you support me?” she asked.