How Can a Builder Build Without Oversight?

1. “Building” Doesn’t Always Mean Breaking Ground

Some developers pre-sell units before a single shovel hits the ground.
They market the project, collect deposits, and use those deposits to fund the build — a risky but legal practice in many parts of Canada.The oversight doesn't always kick in until:

• They apply for permits
• Construction financing is sought
• Or the city demands compliance

This creates a dangerous grey zone where sales and deposits happen before full approvals or permits are in place.

Corporations Shield Accountability

Many builders operate under numbered corporations or special-purpose development companies.
This allows them to:

• Limit liability
• Dissolve entities easily if a project fails
• Walk away with little personal risk

Meanwhile, buyers are left trying to recover deposits from a technically separate legal entity that may now be insolvent.

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 Lack of Real-Time Enforcement

Regulators like the HCRA and Tarion rely on paper applications, audits, and complaints.
There’s no live tracking system that flags when a builder:

• Starts pre-selling without approvals
• Fails to deposit funds into trust
• Changes development plans midstream

So unless a buyer or agent speaks up early — oversight often comes after the damage is done.

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4.  Buyers (and Sometimes REALTORS®) Don’t Know What to Check

Even well-meaning agents and clients often assume:“If it’s listed and has a brochure, it must be legit.”But without checking:

• Tarion enrollment
• HCRA licensing
• Site plan approvals
• Escrow/trust structure for deposits

They’re operating on faith — not facts.

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Bottom Line:

Oversight exists — but it’s fragmented, slow, and not enforced until it’s too late.
And in pre-construction? The builder’s polish can easily hide the missing permits, unregistered warranties, or empty trust accounts. It shouldn’t fall on the buyer to police the process — but right now, it does.Blog post content goes here