The dangers of buying that model home
By Gordon Powers, Sympatico / MSN Finance
New-home buyers who lack the time or money to decorate are often tempted by the move-right-in appeal of model homes. Rather than struggle with floor plans, you know exactly what’s included and also have the advantage of settling into a neighbourhood that’s not totally barren.
Builders sometimes sell their model houses and lease them back from buyers for a few months or more. That way, when your builder-tenant is done, you can move in or perhaps rent it to someone else.
Tread carefully though if you go the model-home route, warns Big Cajun Man on his Canadian Personal Finance blog.
A lot of problems in new-home construction surface later, after a season or two, he writes, citing worn carpeting, poorly applied wallpaper and shoddy electrical work as just a few examples.
Given that most show homes need to go up quickly to get the traffic moving, they’re built for speed, not endurance, he believes. Having the air conditioner on constantly during showing season, for instance, is another trouble spot for premature wear.
On top of this, some model homes may be exempt from builder warranties, even if the building still seems brand new. In the absence of a national warranty program, the rules vary from province to province but, generally speaking, it all comes down to whether or not a home has been occupied and the subsequent wear and tear.
Check with your lawyer and then ensure that your agreement of purchase and sale specifically states whether or not you'll receive the full builder's warranty.
Some builders, for instance, will offer workmanship warranties that begin upon the conclusion of construction, not from the date of purchase. As well, ask to see specific warranties for all appliances, including the air conditioner, furnace, and security system.