Dozens of people who thought they would buy their dream homes in two Oakville housing projects early last year when the housing market was still booming said they never expected property values ​​to fall so low or interest rates to rise so quickly.

Now their builder, Mattamy Homes, is selling the same type of prefabricated homes in the same communities for up to hundreds of thousands of dollars less — a move buyers say is eroding their already impossible financial situation.

They say they face financial devastation because their bank estimates fall far short of the amount they agreed on their homes last year, leaving a huge gap in the financing they will receive when it comes time to sell their homes Houses to close later year.

“We’re in the ointment,” said Brampton attorney Ajit Soroha, who along with his wife bought two homes for their family in Mattamy’s Preserve West development last February. The houses cost $2.46 million each, and they paid about $800,000 in bail for the two.

Now Soroha is wondering if he should back away from that money but, like other buyers, fears the company will sue him if he fails to honor the purchase agreement.

“Mattamy is undercutting us. They make it impossible for us to close the deal,” he said.

The company said it has no control over property market fluctuations and expects buyers to honor the agreements they have signed.

“Neither party lightly signed the terms of the purchase and sale agreement for a new home. The agreement is legally binding for both parties. While Mattamy works with our homebuyers to suggest resources and recommendations to help them close their home, we enter into these agreements with the expectation that they will be enforced,” the company told the star.

But the buyers who protested outside Mattamy’s Dundas Street West sales office on Saturday say they need the developer to offer some sort of relief – even to delay construction of their homes.

“We are in a desperate situation. We’re willing to lose what we have to lose, but it’s going to be a big, big financial devastation for most families in this community,” Soroha said.

Even without the gap between what they paid for and current appraised values, buyers say the drop in home prices means they can’t sell their current homes for what they expected last year, and their mortgages are increasing costs.

Soroha said he doesn’t know who to blame more — the home builder or the Bank of Canada, which raised its interest rate eight times between last March and January after hinting in 2020 that rates were likely to stay low into 2023.

Kamran Ahmad, who is scheduled to close a home in Mattamy’s Upper Joshua Creek this spring, said Mattamy’s new pricing structure has a direct impact on his ability to get a mortgage.

“Most lenders will only consider an assessment based on current sales. Mattamy refers us to his partner lenders who may consider (lent) the full purchase price of our agreements but with very stringent terms where the interest rates offered could be in excess of 10 percent. Otherwise, they’re asking us to fill this enormous gap out of our own pockets, which is impossible,” he said.

Ahmad believes that in these circumstances, there should be consumer protection for homebuyers before construction.

He said buyers should be allowed to exit pre-build sales without penalty, and their deposits would be refunded if the builder lowers home prices below “a reasonable percentage,” such as five percent or 10 percent, or if interest rates rise above a “reasonable value.” “

“These factors are beyond a buyer’s control and directly affect their ability to obtain a mortgage. Therefore, purchase contracts should not be held against them in such situations,” he said.

In an email to the star, Brent Carey, Mattamy’s vice president of communications, stressed that the company, like its clients, participates in a dynamic real estate market that is currently suffering from a slowdown in both the new construction and resale sectors due to rising interest rates.

“Price cuts within Mattamy communities, including those in Oakville, are consistent with the broader housing market,” the email said.

“The sale occurs the moment the agreement is signed, but property values ​​routinely adjust over time as the market changes. Prices may rise or fall between signing and closing, but all parties are required to abide by the firm contract they have entered into and the risks of market volatility they have assumed,” Carey wrote.

Nik Juneja estimates his home in Brampton was worth between $1.8 million and $1.9 million a year ago when he bought his shell house in Oakville because he liked the green space and reputation for good schools for his four-year-old son. Today he estimates his current home is worth about $400,000 less.

His new home in Mattamy, due for completion in August, costs about $2.3 million. Now Juneja said the same model in this development will sell for $1.8 million.

Juneja says his family hasn’t even been to a restaurant in the past year.

“We try to stay at home as much as possible. I’m saving right now. But how much will that help?” he said.

“I’m not going to say Mattamy is bad,” Juneja said. “I’m a regular worker, right? I’m not a lawyer or anything. I will just ask (them) for a price adjustment or help us in any way I can.”

Ivalina Petrov, who lives in Milton, said she bought a $1.9 million home in Preserve West last March to make more room for herself, her husband and their two young children. She said Mattamy is now selling the same house for $400,000 less.

“I know they have the right to sell to whoever they want and for as much money as they want. But offering the same house three houses down the street for half a million less than I’m buying and closing it at the same time – they’re putting me at risk. I am their customer and they only benefit the other customer,” Petrov said.

She said Mattamy bought the land for the less expensive house at the same time that she bought the land for her house.

“How’s that fair?” she said.

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