Another B.C. condo project has run into problems, leaving buyers with pre-sale agreements wondering if they will ever get to move into their new homes. The Willows condominium development in the Okanagan town of Lake Country, just north of Kelowna, is in receivership, leaving about 78 purchasers in limbo.The condos were being built by Divergent Environments, a Victoria-based company, whose website says it has 16 years of development experience in Western Canada, including at least four condominium projects. One of the disappointed Willows buyers is Heather Brown, who until recently lived in an upscale condo in North Vancouver. After retiring, Brown wanted to live a less stressful life. So, with the aim of retiring in the Okanagan, she signed a pre-sale agreement for one of the Willows condominiums. After selling her North Vancouver home in preparation for the move, Brown said she was shocked to discover the development company had gone into receivership leaving the project only 75 per cent complete.
"This was a retirement investment. Stress free! I've had more stress than I've ever had in all my years!" Brown told CBC reporter Gary Symons. Brown has been paying to stay in a local hotel with her dog, and she is not happy about having to pay those costs. "Because I'm on a very fixed income, I can't just keep spending my disposable income with no reimbursement for that. It's wrong, and with no end in sight!" said Brown. Now she regrets signing the pre-sale agreement. "I'm a pretty positive person and everything, but this has taken all the joy, the excitement, everything. I just don't even want to go there," said Brown. Realtor Burt Chapman told CBC News he believes the project will be completed, but it could take another couple of months. The development is now being handled by a receiver, BDO Dunwoody.
Pre-sale agreements are common in the red hot B.C. real estate market. Under the agreements, developers sell off some of the units before construction begins, allowing them to finance part of the cost of construction.Buyers generally benefit from fixed prices, which can result in considerable savings. But the Willows project is at least the fifth development in B.C. to fail in recent months. In most cases, developers have blamed the rapidly escalating costs of construction for making the projects financially unfeasible. In some cases, buyers have been forced to pay extra money to hang on to their units when a new developer steps in to complete the project. In other cases, the original developer has returned deposits and torn up pre-sale contracts, telling buyers they would have to sign more expensive contracts to secure a unit.Real estate experts recommend only signing pre-sale deals with reputable developers with a proven track record of completing similar projects on time and on budget. Even so, Brown said she did her due diligence and even got a realtor to look into the project for her. Now she says, she would never take the risk again of pre-purchasing a home.
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