How about saving money by buying your home off plan?

The subject of capital losses is a very controversial subject in the world of Sale in the Future State of Completion (VEFA) and construction of CCMI houses.

This term of capital loss is approached when it is decided to make modifications to the initial promoter plan through the famous Buyer Modification Works also called TMA (Travaux Modificatifs Acquéreurs) requests.

Concrete example :

Imagine a 2 bedroom duplex plan that provides a bathroom on one floor and a shower room on the other floor. In order to optimise the square meters so expensive nowadays, the practical use of housing, one of these bathrooms can be removed to transform that room into a practical ans useful closet or dressing room for example.

In this case, the sanitary equipment, furniture, wall tiles, floor tiles, radiator will not be installed by the promoter. The promoter will therefore not order these elements which will not be installed within the framework of the TMAs and the promoter will therefore achieve a good saving in the construction.

When quantifying your requests for modification works, it would then seem normal that these equipment and coatings not installed and not laid should be compensated by other services.

We then speak of capital gains and capital losses.

Definitions

The added value will correspond to the prices of the new equipment and coatings requested. For example, adding earthenware to the top of the wall in the bathroom, adding electrical outlets, adding a wall-hung toilet instead of a free-standing one.

The loss will correspond to the value of the equipment that has not been installed or installed. In our example of bathroom removal, the price of the tiling, the wall tiles, the bathtub or shower, the washbasin(s), vanity units, radiator or towel dryer should appear as a loss. in short, everything that was provided for in the descriptive notice but which will ultimately be deleted and not delivered.

Questions and answers

Can I request a refund of the amounts for equipment and coverings not installed?

No. Capital losses do not give rise to reimbursement. Their amount appears as a deduction from the amount of other services in the TMA estimate.

If you ask for a bathroom removal and nothing else like TMA to the promoter, the latter can offer you a compensatory service such as for example the motorization of the roller shutters if this was not provided for in the descriptive notice or a free tiling upgrade for a higher range in 60 x 60 instead of 35 x 35 for example.

What if the promoter refuses to apply the capital losses or to compensate for the non-installation of the equipment?

First of all, there is a way to avoid this very unpleasant situation by inserting a clause in the reservation contract well in advance. This clause must provide for the application of capital losses in explicit terms, in order to avoid any discussion later.

If such a clause was not provided for in the contract upstream of the transaction, then you can refuse to sign the TMA quote by suffering the consequences of not having accommodation as you wish.

The other more acceptable solution for a buyer who wants a new home that suits him, is to negotiate with the developer a lower estimate taking into account the elements that will not be installed, installed or delivered. This negotiation will be carried out by relying on the modified TMA plan and the descriptive notice in order to try to obtain the capital losses.

If the discussions really come to nothing with the promoter, and you come up against a categorical refusal, you can as a last resort rely on the imbalance created by this situation in terms of contractual relations.

If the TMA contract attached to the sales contract that you have signed requires you to pay the capital gains contained in the promoter’s estimate, the latter also has the obligation to subtract the capital losses for the equipment included in the descriptive notice which does not will no longer be installed.

If the promoter refuses to apply these capital losses in your favour, he therefore creates a clear and significant imbalance vis-à-vis you as a buyer and consumer. This imbalance is between the rights and obligations of the parties to the sales contract to which the signed TMA contract is attached.

Can the promoter be required to deliver uninstalled equipment as described in the descriptive note?

You cannot oblige the promoter to deliver uninstalled equipment to you since he will not have ordered them following your TMA request and accepted estimate.

On the other hand, as we have seen previously, the promoter must compensate for this loss with other services.

Find here an example of a TMA quote from one of our clients which includes capital gains and losses applied according to the elements deleted or added.

Our advice: include a clause concerning capital gains and losses upstream in the reservation contract in order to avoid unpleasant surprises along the way. Buyer and promoter will know what to expect and problems will be avoided.