Their first major experience in the real estate market after immigrating to Canada has ended for Fengfeng Zhou and his wife with no home to live in and a fight to get their $50,300 deposit back.
Zhou's wife paid the deposit in March 2018 to secure what's known as a life lease at Trinity Ravine Towers — a faith-based community for Christian seniors slated for construction in Scarborough.
But six years after the project was announced, the parking lot where the towers were supposed to be built remains empty. A Pentecostal church called Global Kingdom Ministries was behind the project, but it's not going ahead as originally planned. The corporation now overseeing the development has returned some deposits, but others life-lease holders are still waiting.
"We feel we are manipulated and deceived," Zhou told CBC Toronto.
A life lease is not ownership, but the right to occupy a unit for a long period of time — often a lifetime, as the name suggests.
The cancellation of Trinity Ravine Towers comes after nine condo projects were cancelled in the Greater Toronto Area in 2020 and four so far this year, according to real estate research firm Urbanation. The cancellations include 4,489 units on top of the 565 lost at Trinity Ravine Towers.
The project's owner, now called Trinity Ravine Communities Inc., says it's been issuing refunds and promises to return all deposits to those who requested them by mid-January. The corporation also says it's planning an alternative project.
Zhou says he's not optimistic about getting his deposit in January. Emails he has shown to CBC News indicate the church pushed back the date of his refund several times.
"I lost trust," he said.
Zhou and his wife have been renting a home while waiting for their condo to be built. Even if they get their $50,300 back, Zhou says it's unlikely they'll be able to use it to purchase a property.
"House prices have increased so much, it's not possible," he said.
Life leases offer less protection, lawyer warns
The cancellation of Trinity Ravine may serve as a warning when it comes to life leases on pre-construction projects, because they don't have to follow the same rules as pre-construction condo developments.
Life leases are typically geared toward seniors who can live independently. The projects are usually owned and operated by charitable entities, including faith-based groups and seniors organizations, which are called sponsors.
Sponsors create a community with tailored amenities, programming and social activities that help seniors live independently. They offer a lower price compared to buying a comparable condo unit.
But, when it comes to putting down a deposit for a life lease prior to construction, consumers have less protection compared to buying a pre-construction condo unit.
"In Ontario there's no specific legislation regulating life-lease purchases," said real estate lawyer John Zinati, whose firm reviewed two life-lease agreements with Trinity Ravine.
Life leases are not under the jurisdiction of Tarion — an organization established by the Ontario government to protect people buying new homes. Zinati says that means sponsors may not be required to return deposits if the project is delayed or cancelled, and deposits don't have to be held in a lawyer's trust account.
"Your security is only as strong as the corporation," he said.
Some deposits returned, but too late for 1 family
CBC News spoke with a couple of people who have received their deposits from the corporation, but they say it wasn't easy.
James Azizieh says after a year-long fight, his parents got their approximately $70,000 deposit back this spring. He says they provided a 20 per cent deposit in post-dated cheques when they signed up in 2016. They were in their 80s at the time then waited years for the project to get underway.
"A lot of years, a lot of stress, a lot of worry," he said.
Azizieh says the delays upended the family's plan to sell his parents' home so they could downsize. Instead, Azizieh moved back in to help them and says the right time has come and gone for them to move.
"They would have already been in this new condo about three years now. So now at age 90, I just can't imagine myself moving them anywhere else," he said.
Trinity Ravine apologizes for late refunds
In a statement to CBC News, Trinity Ravine Community Inc. apologized for the refunds taking longer than expected.
"We fully understand the disappointment and concerns of existing depositors and are working diligently to complete all refunds with interest payments to be made by mid-January 2022."
The corporation didn't respond to questions about how many people purchased the life leases or how many are still waiting for their refunds.
Trinity Ravine says while the original project is not proceeding as planned, it's "currently evaluating various options which we expect will enable us to offer a new housing alternative."
The corporation says it plans to announce those plans in early 2022 and will allow life-lease holders to move forward with the new project or withdraw their deposits.
Trinity Ravine also didn't answer questions about what led to the project's cancellation.
But in a previous emailed update to life-lease holders in April 2019, the corporation told them it didn't have all its required building permits from the City of Toronto. The developer did say, however, that excavation could still go ahead.
Then, in another update this past February, Trinity Ravine announced it wouldn't be proceeding as originally planned, blaming the economic turmoil caused by the pandemic. The corporation also blamed the city for not accepting its proposed precast form of construction, which it was counting on to keep costs down.
Initial life-lease deposits should be low, province says
Zinati suggests potential life-lease holders should research who is behind a proposed project.
"The contract and the paperwork isn't really what's going to protect you. It's the quality of the person or builder," he said. "Has this sponsor done a project before? What does it look like? What's their track record?"
He also points to a 2014 life-lease guide by Ontario's Ministry of Municipal Affairs and Housing, which suggests an initial deposit should only be between $2,000 and $5,000. The guide says the second deposit should be paid once construction starts and be about 25 per cent, including the first payment.
When asked what protections the province has put in place, the ministry suggested consumers should read its life-lease housing guide and get legal advice before signing the agreement.