Pre Con Condo Forced Heat Pump Lease

JosephB012 wrote: ↑Replacement cost of a heat pump is approximately $3k+ depending on the unit size, brand erc. Service call cost is not cheap either depending what needs to be done and fix and who you call.

It should be fine as long as the rental agreement is including repair service and the monthly cost is not out of whack.

FedExpress wrote: ↑ Through some research I've read that some believe the heat pump rental cost is passed onto the tenant (on investment properties) so the tenant pays the monthly lease cost as well as their usage. Has anyone heard of this practice before? I've reached out to some agents as well and am awaiting to hear if this is a new standard practice in Toronto...

FedExpress wrote: ↑ Through some research I've read that some believe the heat pump rental cost is passed onto the tenant (on investment properties) so the tenant pays the monthly lease cost as well as their usage. Has anyone heard of this practice before? I've reached out to some agents as well and am awaiting to hear if this is a new standard practice in Toronto...

FedExpress wrote: ↑ I'm not condoning the practice of the builder - they are hiding behind fine print and sneaky tactics to pass along these costs and that's wrong IMO. What I'm hypothesizing is what is the builder's POV? Do they feel 'demand in DT Toronto is so high, they will make extra $ profit and force owners into locked contracts and tell owners they should pass these costs onto renters because
A)It's DT Toronto and demand is too high some tenant out there will eat it as opposed to other parts of the city where it will hurt occupancy chances
B) Every new condo coming up is doing it so in a few years it will become the norm. (Everyone is doing it excuse).

Again I am not saying this is right, I am just trying to figure out what the builder is thinking and we all know getting a straight answer from them is not a given

FedExpress wrote: ↑ Hello All,

I'm in the process of purchasing a pre-con condo in DT Toronto and after reading the sales agreement in depth during the cool off period I've noticed the developer is forcing all purchasers to enter into a 15 year lease of the unit's heat pump. The developer is not open to removing this clause at this time.

My questions

1. has anyone else experienced this situation in their own pre con investment? Did the developer take out the clause for you in negotiations?

2 how much do heat pump rentals cost? This will impact my monthly ROI as the developer never disclosed this in their ROI projection marketing documents (that's a whole different story on business ethics and hiding behind fine print/high demand)

3. Having to lease the heat pump came at a surprise. Are there any other systems others have seen that developers force you into lease contracts

I've asked my agent to find out the buy out cost of the heat pump.

Thanks all for your feedback

cartfan123 wrote: ↑ Your research is false. No quality tenant would agree to pay for your bad decision to buy a unit in a bubble situation where it’s take it or leave it with the heat pump contract. Builders can get away with this in a bubble for pricing. Either walk away or suck it up.

A quality builder would provide a quality cold climate heat pump such as a Daiken as part of the price. A cash grab scumbag builder will try to jam you with it as a rental. It’s an extension of them getting away with it for water heaters.

But then again if you are buying some scam to begin with with pre-prepared “ROI projections” I don’t know what else to tell you.

StatsGuy wrote: ↑ It's landlord market I'm GTA, tenants will jump through hoops for chance to bid on a rental unit