ChitownLiving | Chicago Real Estate + Life

Speaking from experience, some of the most troublesome post-closing issues are the result of a new construction purchase.  Jeff and I have developed a short list of some of the common pitfalls that may arise.  This is the first in a series of posts that will address potential issues when buying new construction. Often times in developers contracts, I find a provision such as the following: PURCHASER LITIGATION:  As a condition precedent to instituting or initiating legal actions against Seller at any time subsequent to Closing, Purchaser must notify Seller in writing not less than (14) days prior thereto, in which event Seller shall thereafter have the option to repurchase the Unit Ownership, both Dwelling and Parking, from Purchaser for an amount equal to one hundred three percent (103%) of the original purchase price. I uniformly attempt to strike such a provision as a quick read can reveal how grossly unfair such a provision may be.  If the developer should make a mistake in his construction (you would be surprised at how many mistakes do in fact surface) which yields damage at some later time, a Purchaser should have the option to seek appropriate redress without relinquishing the equity he/she has obtained in the property.  Could you imagine a requirement to sell your property back to the developer 5 years later for 103% of the price you paid?