Property

Warning to home-buyers: get-out clause can lift cost

A smart practice widely condemned when it was adopted by a property developer in Queenstown has found its way to Christchurch.

Sunday, February 29th 2004

Buyers who had paid deposits on the first 48 sections in the Ellington Estate Development in Mairehau-Shirley have been told their contracts are no longer valid after the developer failed to get a resource consent by February 20.

A get-out clause in Ellington's contract with section buyers allows the developer to break the contracts even though the buyers believed a deposit had secured the land.

The practice was criticised last year after it was highlighted in a wrangle over a large Lake Hawea development, when Queenstown developer Chris Streat cancelled purchase contracts on 15 sections in the Grandview subdivision.

He then upped the individual section prices by as much as $40,500.

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