9. How does Form 29-New Impact Buyer's Agents?

As a Buyer’s Agent, Should I Be Concerned In the Purchase of a New Condominium If the Seller/Declarant Insists on the Execution of Form 29-New Construction-Conversion Addendum to Condominium Real Estate Purchase and Sale Agreement?

ANSWER: If the Buyer executes Form 29, he should be made aware of the rights being compromised. They include:

(a) Paragraph 2 Specifications. This paragraph allows the Seller to unilaterally modify the plans and specifications. The Buyer and Seller should agree, in advance, that the unit is being purchased in accordance with plans and specifications agreed to in advance by the Buyer and Seller and identified in the Purchase and Sale Agreement. Any change to those plans and specifications would be by mutual agreement.

(b) Paragraph 3 Punch List. Buyer agrees to close the sale even though the so-called “Punch List Items” have not been corrected or completed by Seller prior to closing. Should the Buyer consider an escrow holdback for Punch List Items not completed prior to closing, with the funds being disbursed to the Seller only after Buyer’s inspector has approved the completion of the Punch List Items?

(c) Paragraph 11 – Model Units. This provision prohibits the Buyer from assuming that his unit will be built in accordance with the plans and specifications of a model unit. This re-emphasizes the importance of the Buyer and Seller agreeing in advance that the unit is built in accordance with specific plans and specifications agreed to by both parties.

(d) Paragraph 17 – Pre-Closing Inspection. This provision like Paragraph 3 requires the Buyer to close the transaction even though corrections of defects may be required. Suggest as an alternative the escrow holdback pending completion of the repairs.

(e) Paragraph 18 – Warranties. This paragraph attempts to limit Seller’s warranties. In particular, this paragraph may be construed as limiting the common-law warranty of habitability which protects the Buyer of new residential construction from major structural defects.