Lorenzo Papi had been waiting five years to take possession of the Burlington condo he bought from a plan in 2017. Now he’s waiting for the mail to deliver the cancellation of his contract to buy the one-bedroom unit.
Papi bought in the Nautique Lakefront Residences in Burlington, Ont., five years ago for $427,000.
Last week, he received an email from Adi Developments telling him that, unless he agreed to pay $665,990, his purchase agreement would be canceled and his deposit returned with six-per-cent interest.
Adi Developments did not return calls and emails on Thursday from the Toronto Star asking about the change in price.
But in a March 17 email to Papi, the company cited “unprecedented” cost escalations for trades as the reason for canceling the purchase agreement and hiking the project’s prices.
In addition to the $60,000 Papi paid in four installments in 2017 and 2018, Adi said he would need to pay another $35,700 to “top-up” the deposit.
The email also offered Grandpa $10,000 in “Decor Dollars,” if he elects to pay more for the condo.
Papi said he never expected that his Burlington condo would be finished by the scheduled occupancy date in 2019; construction hadn’t even started and Adi was already at the Ontario Municipal Board in a dispute with the City of Burlington over the height of the building.
What galls him, said Papi, is that, by the time the company informed him the price was going up, the building had been under construction for a year.
The Ontario government has announced it is planning new regulations, including fines and license suspensions, to deter home and condo developers from canceling projects and purchase agreements, leaving buyers in the lurch.
Government and Consumer Services Minister, Ross Romano, said, on Thursday, he was imposing tough new measures to target those that cancel agreements to try and resell units at a higher price.
A Vaughan resident, Papi bought the condo in Burlington as an investment, a place for his 13-year-old son, in future.
“By the time he needs something, you’re looking at $3 million, so you want to get things started,” he said.
But it’s the buyers who planned to live there that Papi says are in the worst position.
“They want to get into the market. When something like this happens five years later, well, they’re screwed,” he said.
Grandpa says he won’t be paying more for the Nautique unit or another pre-construction unit condo.
“This left a very bad taste in my mouth,” he said. “So if I were to purchase something else, it would be (an) existing (unit).”
Richard Lyall, president of RESCON (Residential Construction Council of Canada), said he couldn’t speak to the specifics of Adi’s Burlington project. But he said the home-building industry is struggling with supply-chain issues, run-ups in labor costs and pandemic-related delays.
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