Developers - Closing Procedures

lastirishdon

Hi,

I bought an apartment last year off the plans which was not due to be finished until spring 2008. I received a letter on friday from the developer telling me that the apartment would be completed on the 5th November 2007 and that I had one week to close.

I was wondering what are my legal rights? The contract I signed stated that completation would be 2008. Do I have to close now in November?



Any advice appreciated.

juke

A bog standard building agreement/contract for a new house would state that

a. the house/apartment will be completed within a certian time frame - eg 12 months
b. once completed, you will receive written notice the it is completed and you have a certain amount of days to close - ususlly 14 days, more infrequently, 28 days.

It has been held by the high court that a condition that states you have 7 days to close is unfair - so your solicitor will have to fight your corner there.

But to answer your main question, do you have to close - unless your agreement/contract is different to the bog standard - yes:(

GUIGuy

Well I'll tell you a story of what happened to me. I purchased an apartment off plans (2 years beforehand). Being on the ball I had my mortgage all ready to draw down for the expected date. But the developer took longer than 2 years and then sent me the "You must pay in x weeks" letter. So I had a frantic time because the first mortgage offer had expired and I needed a new one... my bad! But I got it.

But then there were a series of 'delays', first the block policy, it was not ready. Then my doctor informed me that he was in a payment dispute with the life assurance company and would not send them a cert. When I paid myself they would not fax or email over a secure line as they were in dispute over technology. Then the developer wouldn't give me access to the site to snag. When I informed my solicitor they did give me a snag date but then didn't turn up on the day to let me in. Furious I was eventually let in about 2 weeks later... it was not complete and I was not allowed see all that I had purchased (underground carpark). More delays... so when the deadline expired I was charged about €1000 a week in late fees! So all in all whether by their incompetance or design I was 5 & a half weeks late and I was told that if I didn't transfer funds immediately (even though the apartment was unfinished) they would forfeit my deposit!

The contract I had signed stated that I had to pay within 4 weeks of the apartment being complete or 4 weeks of my receipt of the letter of completion... whichever was sooner. I generally thought developers would send out such letters when they are ready to let customers snag and when they have block policies in place... but no. In those days maybe they wanted to shield their risk by getting people to buy off the plans only to engineer a situation where their customers would be late and they could then charge a higher price to newer customers.

The advise I got was that the developer was acting unfairly and that I had a solid case. But I would have to get a highcourt injunction to stop them claiming my deposit and that the legal fees involved could be greater than the apppreciation of the property in the previous 2 years. And the developer knew this fact also. So essentially put up the money or walk away minus your deposit! A bitter pill but I had to swallow it!

So unless there is anything plainly illegal in the contract it you'll proably have to close or be in breach of the contract. Have you talked to the developer/solicitor? What are penalties/procedures for being late?

In today's market they will put extreme pressure on you, but it's not likely that they want to wrangle their way out of the deal, more likely because they need the money fast themselves. But it's not in their interest to make life impossible for you either (unless they have other buyers waiting).

Good luck and don't let it ruin the enjoyment of a new place!