Joe And Doug Williams

Just Dropped In (To See What Condition My Condition Was In)

29 July 2019
Joe And Doug Williams

Sometimes houses sell firm. Meaning - as soon as both sides sign the agreement - the deal is done. Neither the buyer or the seller can walk away, and the sold sign goes up immediately. But most houses sell conditionally - allowing either the buyer or the seller (usually the buyer) to perform some due diligence & potentially walk away from the deal. There are countless ways to structure and word conditions, but in residential real estate - we run across a handful of standard conditions most of the time. 

In most GTA communities - the majority of freehold homes sell conditional on the buyer obtaining satisfactory financing and performing a satisfactory home inspection. The typical length of time for these conditions is 5 business days. The key word for both conditions is satisfactory. Even if the buyer can find a company willing to provide them with a  mortgage - the buyer has to be satisfied with the terms of the mortgage. Likewise - with a home inspection - there is no passing or failing grade for a house - it is up to the buyer to decide if the home inspection was to their satisfaction. 

When a condominium is sold - it is often conditional on the buyer & their lawyer reviewing the “status certificate.” The status certificate contains the financials & the rules and regulations for the condominium corporation.

If the buyer’s agent notifies the seller’s agent within the conditional period that they are not satisfied with their financing, a home inspection, or a status certificate - the listing brokerage would release the buyer from the deal and return the buyer’s deposit. 

In hot “seller’s markets” - we see an increase in homes selling firm (without conditions). Selling your home firm is amazing - as you can immediately rest easy that the deal is done. But buying homes firms is stressful for purchasers, as it limits their ability to do due diligence.  

In “buyer’s markets” - we see an increase in homes selling conditional on the buyer selling a property. This is great protection for a buyer - as it limits the risk of having to carry two houses at once. But these are often long conditions (30 days for example) & very unappealing to sellers.

The market environment, the type of home (brand new vs century home for example), and your own personal situation (financial situation for example) will determine what conditions to include, and the length of the conditions. We can help advise on which conditions will appropriately protect you as a buyer, but will also allow you to secure your desired home. When representing sellers - we can advise on which conditions are reasonable, and which are too onerous. Call anytime to chat - we love hearing from you and appreciate your referrals to friends and family.


Cheers,
Joe & Doug