New Construction Delays

Chicago, IL Viewed 22 times. Posted 25 days ago in Real Estate

I signed a contract for a condo unit preconstruction back in 2005. There were significant delays on the developer's side in completing the building. They have finally indicated the building is complete and that they are ready to beging closing on the units, however I no longer which to purchase the unit. Is there an argument I can make the contract should be nullified due to the length of time that has passed. The contract did not contain an estimated closing date. - Is this your question? Add additional information

Answers (3)

Mazyar Malek Hedayat

This attorney is licensed in Illinois. Posted 25 days ago.

Your question is whether you can abandon a real estate contract if the builder has caused a lengthy delay. The answer is "Maybe, depending on the terms of the contract and applicable laws, regulations, and codes.

My office has dealt with a number of situations like this one in Illinois, Florida, and California. The results were mixed because each jurisdiction has its own laws as to such contracts and, more importantly, because these situations are generally handled based on practicality - not simply prevailing law.

The rule in such situations is that the contract controls the relationship of the parties unless a contrary law, statute, code, or regulation exists. With Chicago construction there are many, many potential pitfalls for the developer - and many potential ways to exit the contract. The devil is in the details.

Another consideration is the amount you may have deposited in connection with this purchase. Builders will sometimes back off if they can keep a healthy chunk of earnest money and try to sell to someone else. But this tactic works best in a market where prices are rising or are stable: it may not work as well in the current economic climate.

I recommend spending time with a knowledgeable attorney in your area who can counsel you on the best way to negotiate with the builder. I hope this information has been helpful. Feel free to contact us with any follow up questions.

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Erik Glen Swanson

This attorney is licensed in Illinois. Posted 22 days ago.

If the contract contained nothing relative to the time of completion, probably not.

Robert M Diamond

This attorney is licensed in Dist. of Columbia and 2 other states. Posted 5 days ago.

Unless you received a HUD Property Report, your contract may be terminated if the Condominium does not qualify for an exemption from the Interstate Land Sales Full Disclosure Act ("ILSA"). The two most common exemptions are for condominiums with less than 100 units and where the contract requires the developer/seller to deliver the completed unit within two years (plus force majeure delays) after the purchaser signs the contract. To determine whether you can terminate the contract and obtain a refund of your deposit, you will have to analyze the contract and determine whether the project complies with or is exempt from ILSA. Good luck!