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Construction reservation in purchase contract: how does it work?

Navigating the complexities of a home purchase can be daunting, especially when it comes to safeguarding your investment from unforeseen maintenance costs and structural issues. Including a building reservation clause in your purchase contract not only provides peace of mind but also empowers you to make informed decisions, ensuring that the dream home you envision doesn't turn into a financial nightmare.

As of February 1, 2018, a model purchase contract for a home includes a building reservation. This means the buyer can terminate the agreement if the building inspection reveals that maintenance (backlogs and repairs) will cost more than agreed. Termination can also be triggered by an unusual situation, such as the suspicion of asbestos.

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