Queensland family say they missed out on their dream home after developer Kasalia asked for an extra $200,000
A Queensland family said they were devastated after their developer invoked a legal termination clause in their contract and claimed they were then asked to pay a staggering $200,000 raise for their dream home.
Mum Di, who did not want her surname used, and her husband, had registered for an off-plan development in April last year in the Brisbane suburb of Nundah.
She said they agreed to pay $650,000 to build one of the project’s three-bedroom townhouses with developer Kasalia Pty Ltd.
“Because the market was so crazy for existing homes, we went with a fixed build option. As a young family it made more sense how much we would spend,” Di told news.com.au.
“It was the first family home we bought.
“We would have bought a few years earlier, but we lost a child at the end of term, so circumstances delayed it and we bought when it was crazy.”
The 38-year-old said the family was originally due to move into the townhouse in January this year but construction has been delayed.
Di said the project was still moving forward but the couple were shocked to receive an explosive letter in May.
He came from the developer’s lawyers and said with “great regret” that the contract would be terminated in seven days as the development had been hit by “substantial delays” and increased financial costs.
In the letter, the delays were blamed on a combination of reduced access to building materials and labor shortages following the global Covid-19 pandemic and recent weather events in the southeast. from Queensland.
“These delays have seen the seller overstay their construction loan which has
necessitated the renegotiation and extension of their financing agreements to
additional cost,” the letter read.
“Unfortunately, this, combined with rising construction costs and the ongoing expense incurred by the seller in holding the land throughout the delays, has caused the seller to reassess the feasibility of the development.”
The couple were then asked to contact the developer’s estate agent “to discuss the possibility of negotiating a new purchase agreement”.
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“A few difficult years”
The Brisbane couple had been ‘thrilled’ to finally buy their own home, particularly after experiencing heartbreak, but that excitement crumbled with the letter.
“After a difficult few years of losing a baby and Covid and my husband and I were living away from family, it was something for us to look forward to starting our family, so the emotional toll was very heavy “, she said. .
Di said they were “flushed” by the explosive letter but also “pissed off” leaving the pair with a “bad taste in their mouths”.
The official added that she and her husband were concerned that the increase in material and labor prices would be presented as “a general statement” with “no cost” attached.
“We were supposed to take this at face value,” she noted.
She said the couple were so angry they never contacted the developer’s estate agent. But the agent called about four days after the letter was sent offering them their dream home for an extra $200,000, she claimed, which they rejected.
Now, she says, they have been priced out of the area where their dream home was being built and are facing their third rent increase in just two years, Di said.
“We are back to square one and it looks like we are in a precarious situation with the rental market with our lease ending in six months with a toddler and being back there and having to watch where we can go. allow. The area that we could afford a year ago, we can’t afford it anymore,” she said.
“I think we’ve potentially missed the boat and may be stuck renting until the foreseeable future when we understand what’s going on in the market and can be confident in handing our money to a builder because we are all fighting for existing homes.”
Di wants to see better protections for buyers in the off-plan process.
“It’s much easier for the builders to withdraw and cancel than for the buyer. It leans a lot towards the seller and the developer and the buyer has the biggest risk,” she said.
A spokesperson for Kasalia Pty Ltd told news.com.au that the company is a small-scale developer and the project was one of their early developments.
“Unfortunately, our project has experienced long delays due to Covid, the war in Ukraine and recent QLD flooding which has caused extreme material and labor shortages and increased construction costs. on top of that, we also came under pressure from our financier and had to extend our loan agreement several times due to the delays,” they said.
“We never intended to go in this direction.”
They added that it had been “difficult and stressful” for a small family development company to do business in “this volatile market”.
Families affected by breaches of contract
News.com.au has revealed a number of Queenslanders who were shocked and upset after losing their dream home when developers legally terminated contracts.
There was Leanne Stavrou and her partner who had signed two off-plan developments in Queensland.
They walked away from one after being given two days to accept a staggering $150,000 raise for their dream home, while the other was canned as the developer was “unable to secure financing “.
Another landlord who bought an off-plan development in Brisbane, which has now been abandoned, described the development company’s decision as an ‘absolute joke’ saying it would leave his family ‘financially screwed’.
Meanwhile, other families have been impacted by the invoked sunset clause as projects were not completed on time.
An experiment has left a Queensland mother ‘crying every day’ after her contract was canceled due to its sunset clause, while a father said he was kicked out of the region after his contract was terminated contract.
Another couple saw their contract end just nine months after signing it, leaving them angry and distressed.
Sunset clauses are legal in Queensland and have been used on other developments in Brisbane and the Gold Coast.
Other states in Australia have moved to put more protections in place for buyers buying off-plan.
In New South Wales and Victoria, special laws have been established requiring sellers to obtain the consent of the buyer or the Supreme Court before using the sunset clause to terminate an off-plan contract.
A spokesman for the Office of Fair Trading said the Queensland Government was looking into the issue of terminating off-plan contracts via sunset clauses, as part of the property law review, which is currently underway. course and could introduce changes at the end of the year.