This is why you want a Wise Lawyer - Mississauga

Builder, purchasers fight over increase in closing charges

A Toronto-area builder has filed a notice of appeal after losing two small claims court cases to new condominium buyers who sued to recover thousands of dollars in “unreal” closing charges.

The successful plaintiffs were among as many as 244 purchasers in the Rouge Residences project at 57 Upper Duke Cr., in Markham.

The builder’s agreement of purchase and sale contained a price adjustment clause typical of those used by local builders.

It provided that in the event of an increase in any existing municipal levies or development charges after the document was signed, “the purchaser shall pay the increase . . . as an adjustment” on closing.

Just after the purchase agreements were signed in the fall of 2006, the developer, a subsidiary of Remington Homes, decided to prepay to the Town of Markham more than $4 million in development charges at the then-current rates. By prepaying the charges, the developer was able to ensure that it would not have to pay any increases which might be imposed before the condominiums were completed.

Toronto lawyer Stephen Shub represented a number of purchasers in the Markham project. He told me that on closing, his clients were shocked to see that they were being charged between $7,680 and $11,283 for increases in existing levies.

Shub discovered that the builder had not actually paid the increased amounts set out in the schedule. Prior to closing, the town had imposed thousands of dollars in higher levies, but the builder was exempt because the increases were not retroactive.

Shub’s clients took the position that the builder had no right to charge purchasers for levies it had neither incurred nor paid. The disputed clause in the agreement, he said, “can only apply to monies paid by the builder to the Town of Markham and not to monies never paid by the builder.”

Despite Shub’s objections, the builder insisted it was entitled to recover levy increases that had been implemented by Markham but that it had not been required to pay.

Chris Rose sued Rouge Residences for $7,487.48, and Voula and Slave Sterjovski claimed $11,037.48 in their court case.

The cases were tried together before deputy judge Morris Winer in January. In his oral decision, Winer discussed the wording of the agreements of purchase and sale, and the fact that the builder prepaid the development charges.

“In my view,” the judge said in his decision, “what is collectively referred to as ‘the existing levy’ never increased. Indeed it appears to me there never was a levy. . . . The charges that the defendant is seeking to impose on the plaintiff are hypothetical because there never were any of these levies.

“The rates did increase after the agreements were signed. But these were rates; they weren’t actual levies of taxes. They were never, as the clause provides, imposed on the defendants. The whole clause is somewhat ambiguous and I adopt a(n) . . . interpretation that I believe makes sense and is fair and just.”

Winer awarded the Sterjovskis $11,037.48 plus costs, interest, a preparation fee of $100 and attendance fee of $500. He awarded Chris Rose $7,487.48 plus costs, interest, a $100 preparation fee, and $400 for an attendance fee.

Richard Tripodi, Remington Homes’ highrise vice president, declined to comment on the case while it is before the courts.

In its notices of appeal, Rouge Residences cites what it claims are a dozen errors made by the trial judge. A date for hearing of the appeal in the Divisional Court has not yet been set.

If the trial decisions are upheld on appeal, the Sterjovski and Rose cases may just be the first two in as many as 242 other cases of purchasers who would like refunds of the charges paid to the builder. Toronto lawyer Michael Carlson is representing Sterjovski and Rose on the appeals, and is also coordinating a class action against the developer.

In the wake of the claims made in this case, and my column about it in November, 2009, the Ontario government passed a regulation effective Jan. 1, 2011, which prevents builders from charging purchasers for extra charges they did not incur.

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LINK TO THE Court endorsement in the case of Sterjovski v. Rouge Residences

Bob Aaron is a Toronto real estate lawyer. He can be reached by email at bob@aaron.ca, phone 416-364-9366 or fax 416-364-3818.
Visit the Toronto Star column archives at http://www.aaron.ca/columns for articles on this and other topics or his main webpage at www.aaron.ca.

David Pylyp Accredited Senior Agent This is the perfect time to discuss the 10 day period of Rescission. This is the 10 day period where you have your lawyer examine the contract in detail to find the clever phrases that can alter or obscure the meaning of who pays what expenses on closing some 3 or 4 years down the road. An excellent point is made to contact a Wise Lawyer. I know a few.

Gently used Government building could be yours

It was my pleasure to interview the past Mayor of Etobicoke, currently sitting Toronto Councillor Doug Holyday. This destinguished gentleman has served a long term in the public sector.

In attending the offices at the Etobicoke Civic Center, my consideration was what a fabulous location on and off the highway that would better serve as high rise high density mixed use being a combination of retail commercial with residential above. [Hard not to be a realtor]

This became one of our conversational points. If the City moved its west offices to one of the subway hubs, either Kipling or Islington, and built on (vertically) what was previously a bus terminal, this would be a prudent, intelligent planning choice to provide services to the public (ultimately the city's customers) in a location where the residents could easily access.

Imagine, slipping home early on the subway for your extra stop at the New and Improved Civic Center to pick up your approved Fast Tracked Building Permit for the changes you are making in your house.

With the relocation of the civic centre to a subway corridor there is now the matter of the Burnhamthorpe site. DOug Holyday said "We don't need something as opulent as the Taj Mahal, we need something that is functional and will serve the residents long term". Councillor Holyday continued "this entire building could be extirely funded from the sale of the Burnhamthorpe and West Mall location sale, this would be betterment for the city in providing a new building and an improvement to the Neighbourhood that already has higher use structures." Have a look

The dedicated people that run the Municipal level of government are always under the microscope of public opinion and the purse strings of tax dollars. Money at these levels is not raised as a bake sale. Money comes from Federal and Provincial programs for infrastructure but ultimately a municipality raises funds thru the development fees collected and the ongoing taxation of residential and commercial property owners. These are issues for experienced people who are altruistic in their goals to help others in their own community. Hospitals, Recreation Centers and Transit identify the larger issues but the smaller councils also decide the fate of the tree on your front lawn.

Will the Double Miller Tax [Toronto Land Transfer Tax] be repealled with a new administration? How will transit expansion unfold in the near future? Will there be new subway lines ie Eglinton Ave.,?

Investigate and support someone who is running for office. Help them get elected. Have a voice in the process and how our tax dollars are being spend.

Thank you Mr. Holyday The second part of the interview is here.

Beware as Lenders Tighten on Condo Mortgages Toronto

We have seen that Condo buyers are facing stricter lending guidelines, dropping values (especially for in-construction buildings) and, if they're self-employed or buying for investment purposes, new rules and restrictions.

In fact, situations where people who bought suites two years ago and thought they had a big enough mortgage to cover 75 per cent of the price are now being told 65 per cent is all their lender will put up.

New condo buildings can go down in value due to builders cutting back on extras and upgrades to increase affordability, says a Globe and Mail reporter.

Along with dropping values, self-employed condo buyers in particular have to show higher credit scores (in the 680 range, up from 620).

In addition, real estate investors face more restrictions - for example, lenders can only count 50 per cent of rental income toward revenue needed to qualify for a loan when it used to be 80 per cent.

Make sure you know your facts and that you consult a real mortgage professional (accredited and licensed) who will make your buying or refinancing experience pain-free, stress-free and enjoyable. With over 50 lenders available in Canada, there are simple and easy way to make sure you get the right mortgage tool to get you where you want to be.

Danny D. Kellman, MBA, AMP, EPC [ddkellman@mortgages4women.ca] is a principal with

The Mortgage Diversity Group Their blog is Mortgages 4 Women, Toronto, Ontario. Danny Kellman and Marcy Berg concentrate their efforts on bring information and knowledge to the growing base of women only mortgage business. Danny can be contacted at 300 - 40 Wynford Dr., Toronto, ON, M3C 1J5

Phone: 647-929-5346 Toll-free: 1-888-372-7367 ddkellman@mortgages4women.ca

Best July Ever for Toronto Real Estate

Toronto’s housing market has followed a record-breaking June with its best July ever and real estate experts say sellers will have the advantage with the current limited inventory and prices edging higher.

According to the Toronto Real Estate Board, homes sales in the Greater Toronto Area last month rose 28%, to 9,967 from 7,806 homes sold a year ago.

It was the best July for sales since the board started tracking the numbers in the mid-1960s. And the average sale price was $395,414, up 6% from a year earlier.

“We have seen the increase across all different housing types. It’s not just first-time buyers coming into the marketplace,” said Jason Mercer, the real estate board’s senior manager of market analysis.

“At the end of 2008, we saw a steep dropoff in sales. Those people who became confident, you’ve seen them move back into the housing market and interest rates moving down to historic lows helped that out.”

These summer months stand in contrast with the market environment last fall when sales plummeted.

Back then, Candace Kaszas, a sales representative with Keller Williams Advantage Realty, listed a two-storey detached brick house in East York with a free car to attract buyers. In Rosedale, one of her clients dropped the price of a two-storey, five-bedroom home in Rosedale from $2.4-million to $1.9-million.

But today Ms. Kaszas said: “Things are looking up.”

“February right through, it hasn’t stopped,” she said. “Right now, it is a seller’s market ... We’re constantly in multiple offers. Recently, a two bedroom bungalow, with no parking and an unfinished basement had four offers. It was listed at $329,000 and it sold for $375,000.

“Consumer confidence has come back. The media has stayed out of it; for the past month it has been all about garbage and nothing about real estate and we’ve been selling up a storm.”

Christine Martysiewicz, spokeswoman for RE/MAX Ontario-Atlantic Canada Inc., said most GTA neighbourhoods saw decreases in the price of detached homes and condos in the first six months of this year.

“Consumers got very scared with all of the negative news,” Ms. Martysiewicz said. “A lot of people did not; they got into the market and got the best deals that we’ve seen in a long time.”

Buyers can still get a good deal, she added.

“That’s not going to last. Those prices will go up if inventory does not come on the market,” she said.

Last month, 36% fewer homes were listed for sale than a year ago. New listings were down 18% from last month compared to July, 2008.

“Inventory is very, very low. The demand is quite high. What that does is cause increases in the prices of homes. Prices will be on par, if not exceed, 2008 levels by year-end,” Ms. Martysiewicz said.

Mr. Mercer said people will likely list more houses as sales and prices climb. Though year-to-date sales are still 1.2% lower compared to this time last year, he predicts that the market will continue to do well, maybe even surpass 2008 figures.

David Pylyp: Inventory for sale is almost non existent in downtown condo's under $300K or west Toronto /Mississauga Townhouses with a double garage below $400K. The average detached house is $390 thousand. Historically the summer months have generally been slower for sales.

Is there a ceiling?

If you would like to read the Market Watch report it is available here

Thinking about Selling your place? Let's get you a number.

Fireplace in a Condo

Add a fireplace anywhere

Historically the main function of a fireplace was to provide the principal source of heat, and therefore was typically positioned centrally.

Today, fireplaces are less functional and more focal points for a room; they are installed to create a cozy luminescent atmosphere and their design has to be consistent with the overall style of the home. In the last decade fireplaces have evolved in terms of both style and heating mechanisms.

There are infinite styles available, for example wall mounted, freestanding multifunctional coffee table/fireplaces in a variety of materials (stones, wood, steel, glass) and colours. Along with the traditional wood, gas and electric models, the market has introduced new fuels like gel or liquefied ethanol. These new energy sources are great for condos where it often isn’t possible to install an exhaust system.

All these and more can be found locally at 360living.ca located in Toronto at Dupont and Avenue Road. I had the pleasure to meet with Christine Denault of 360 Living to discuss the most popular choices and finishes. Christine indicated that there was also strong demand for their outdoor self contained units.

I would encourage you, to seek out the newest technology both for their esthetics and improved visual appeal of your west end condo. The Bonus! You also get the Home Improvement Tax Credit.