Writing on a spec home is not the same as writing on resale property.
In Alberta, the builder’s contract will govern the deal. Every time.
Sometimes you will submit the initial offer on an AREA contract and negotiate conditions there. Other times, the builder will require you to write directly on their agreement from the start. In both cases, the final executed contract will be the builder’s purchase agreement. That agreement supersedes earlier forms.
This is where confusion can happen.
If you are not prepared for the transition, your buyer will not be either.
Do Builders Have to Use Their Own Contract?
Yes. In Alberta, builders require their own purchase agreement to be executed on spec homes.
Even if negotiations begin on an AREA Residential Purchase Contract, the transaction is typically transferred into the builder’s contract once terms are agreed upon.
Builders will usually act in good faith to ensure negotiated terms are reflected properly. However, you must confirm that:
- Conditions are accurately transferred
- All agreed upon terms are included
- The possession date matches what was agreed
- All amendments are properly incorporated
Never assume the earlier paperwork controls the deal.
How Builder Contracts Differ From AREA Contracts
Understanding the big differences helps you prepare your client properly.
1. Builder Contracts Are Written for Construction Projects
Most builder agreements are drafted to cover presales and construction timelines across an entire project.
Even if the spec home is complete, the contract may contain:
- Language about construction delays
- Substitution of materials
- Project timelines
- Completion standards
Some of this language may not apply to the specific home your buyer is purchasing. When buyers read these sections without context, it can cause concern.
Prepare them in advance. Explain that the document is standardized for the builder’s operations, not custom drafted for each finished home.
2. Mandatory New Home Warranty Coverage
Builder contracts include terms related to new home warranty protection.
In Alberta, warranty coverage is required by law for new homes under the New Home Buyer Protection Act.
This protects the buyer.
The contract will reference the warranty provider and coverage structure. Make sure your client understands that this is a statutory protection that comes with new construction.
3. Builder Protective Clauses
Builder agreements contain provisions designed to protect the builder’s position.
These may include:
- Delay rights
- Strict payment timelines
- Default provisions
- Limitations on claims
- Acceleration clauses
This is normal in construction contracts. The agreement allocates risk differently than a resale contract.
Your responsibility is to read it carefully and explain the implications clearly.
4. Change Orders Replace Traditional Amendments
On spec homes, negotiated items are often documented as change orders.
Upgrades, credits, or revisions may be attached as separate written documents that form part of the overall agreement.
Confirm that:
- All negotiated terms are in writing
- The change documents are signed
- Pricing adjustments are clearly shown
Do not rely on verbal confirmations.
5. Floorplan Sign-Off on Base Models
In many cases, the builder will require the buyer to sign off on the floorplan of the base model used to build the spec home.
Sometimes the base model plan does not show all plan options or structural changes that were incorporated into the specific spec property.
Prepare your buyer for this.
Explain that they may be signing a standard plan version for reference purposes. If there are structural or layout changes in the finished home, ensure those are documented elsewhere in the agreement or attachments.
Clarity prevents unnecessary concern at signing.
6. Possession Dates May Differ From Resale Expectations
Possession terms can vary significantly.
If the spec home is complete, possession may be straightforward. If it is still under construction, the contract may include estimated timelines or delay language.
If you negotiated a firm possession date earlier, confirm that the exact date appears in the builder’s agreement.
If the builder cannot guarantee possession, discuss this openly with your buyer before they sign. They must understand any flexibility built into the contract.
Best Practices for Alberta Agents Working With Builder Contracts
To represent your client properly on a spec home:
- Always obtain a full copy of the executed builder contract
- Ensure you are included in electronic signing processes
- Confirm all negotiated terms are transferred correctly
- Review possession language carefully
- Read all attachments and schedules
If something is unclear, consult your broker. You may also advise your client to seek independent legal advice from a real estate lawyer.
Why Understanding Builder Contracts Matters
Builder contracts are not administrative formalities. They are the documents that govern the transaction.
When you understand how they differ from resale agreements, you reduce confusion, manage expectations, and protect your client’s interests.
In Alberta’s spec home market, confidence with builder agreements is part of professional representation.