Monday, April 18, 2016

Closing costs should be included in condo prices, lawyer says

CBC News Posted: Mar 11, 2016 6:45 PM ET Last Updated: Mar 11, 2016 6:51 PM ET

Ministry of Consumer Services to consider unexpected costs as it develops new regulations

There are calls for more protection for condominium buyers after a group of new Scarborough homeowners said they were surprised by tens of thousands of dollars in closing costs.
Earlier this week, about 40 residents of 1328 Birchmount Road got together to compare the letters they had received outlining the closing costs on their new units.
Some said they had been expecting costs of between $5,000 and $12,000. Instead, they received bills for between $20,000 and $30,000, and as high as $60,000, just days before their closing dates.
The situation has some calling for closing costs to be included in a condo's "sticker price," which is similar to airlines, which are now required to advertise fares that include taxes and fees.
In addition to developers' fees — which the city sets and developers then recoup — closing costs can include utility connection fees, legal fees and, for some, the land transfer tax and HST.
Audrey Loeb, a real estate lawyer who specializes in condos, says developers don't include closing costs in the advertised sale price because they are not required to.
"There should be no surprises," Loeb told CBC News this week. "The government should require that these charges be included in the purchase price."
David Orazietti, Ontario's Minister of Consumer Affairs, acknowledged that there can be an "information gap" between developers and buyers when it comes to the advertised sale price and the closing costs.
"They want to attract people into their condo development, they want them to buy it," Orazietti said this week.
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