Real estate: A deal’s a deal, judge rules

In a judgment released late last week, Sweeny called the case a “straightforward breach of contract” case.

“A drop in real estate values, even a dramatic drop, would not meet the test of frustration, impossibility or be a force majeure,” Sweeny wrote in his judgment.

All that remains to be determined by a trial is the amount of damages that should be awarded.

It’s not the first time in the past year that jilted house sellers locally have turned to the courts to have a sale contract enforced.

Last November, a Burlington couple succeeded in having a $116,000 charge for damages registered against the property of an Oakville couple who had backed out of purchasing their house on North Shore Boulevard West, near Holy Sepulchre cemetery.

The Oakville couple had agreed in April 2017 to buy the Burlington house for $1.9 million with no conditions. They intended to sell their Oakville house and a property in India to finance the new purchase.

When the purchase fell through, the Burlington couple discovered the Oakville property had been taken off the market and the purchasers were going to India without return tickets to Canada. The judge agreed with the Burlington couple’s fears that the purchasers were planning to stay in India to avoid the consequences of backing out of the deal.

Jack Loft, president of the Realtors Association of Hamilton-Burlington, said he believes the two court cases are rare situations caused in part by the tail end of a hot market last spring that cooled off quickly, leaving some purchasers exposed who bought with no conditions.

“As agents, it’s our duty to advise our clients of the consequences,” he said. “I think most people go into it with their eyes open.”

Loft said purchase offers with conditions attached in the spring of 2017 had little chance of success at the time, but that’s corrected itself.

“We’re back to a market where conditions or a home inspection are normal,” he said.

There are signs, though, that Hamilton’s real estate market is starting to warm up again.

For the second quarter of 2018, aggregate house prices were up 6.1 per cent in Hamilton compared to a year earlier, according to the latest Royal LePage house price survey.

That’s substantially better than the national median. Across Canada, aggregate house prices were up two per cent compared to last year’s second quarter.

The median price of a two-storey house rose 5.9 per cent to $571,330 compared to the second quarter of 2017, while the median price of a bungalow increased 7.6 per cent to $496,000.

For condominiums, the median price in Hamilton inched up 0.8 per cent to $321,000.

“Hamilton continues to see house prices rise on a quarter-over-quarter basis, yet remains an affordable place to live relative to the Greater Toronto Area,” said Joe Ferrante, broker of record with Royal LePage State Realty.

“While sales activity for two-storey homes is slower than usual, we are still seeing multiple-offer scenarios on properties that are well priced,” Ferrante added.