Buying Pre- Construction Condos - Beware!

I recently attended a seminar about buying a pre-construction condominium. It was a refresher course for me and it reinforced that there is much more involved in buying a condo ‘off the plan’ than just signing on the dotted line - so I’m writing this because I strongly suggest that before you enter any sales centre of a new development, enlist my assistance to guide you through the intricate details of buying new.

First are the sales centres, all dressed up in luxury surroundings appealing to a lifestyle everyone wants to live. Cool music to satisfy the auditory senses, coffee machines brewing that golden shot of espresso for the olfactory, stunningly upgraded model suites designed to entice us. But buyers beware! They are there to stir up the emotions and make for a quicker sale and for you to sign on without looking at the finer details.

Being able to read and interpret a floor plan is crucial. To know and understand spacial awareness of a layout that is functional and provides enough space for each and every use. Most Realtors understand what works and what does not and why. I have come across many buyers who have purchased without any guidance, only to be very disappointed that the unit they bought lacked space and functionality, hence affecting its value and quality. We at PropertiesInStyle know which floor plans work and what will be very sellable in the future.

And it’s not only buying the right floor plan that is important. There’s also understanding the purchase documents which are written on the builder’s forms, NOT the standard purchase and sale agreements you see in the resale sector. These forms can be very complex and one should know what questions to ask and where to drill down for the details.
For example;
What other closings costs are involved? Are the closing costs capped? Is the building covered by Tarion warranty? Is the parking and locker separately deeded or ‘Exclusive Use’? What are the developer’s rights to extend the closing date?
These questions and many, many more, affect the value and enjoyment of the property.

Of Course GST and HST are involved with the purchase of a new condominium. As this issue is another complex issue during the process, a Realtor is able to ask the right questions that are applicable to your situation such as your eligibility for a rebate as an owner occupier, or an investor.

It is the job of the developer’s sales representative to sell as many units as possible. They may not always be there to discuss the intricacies of the purchase. Also, they are there to promote and sell the units that are less desirable. That’s what we in the real estate world call the ‘dog suites’. These are the units that have more than a few compromises so it is important to ‘get in first’ and have the best choices available. Typically Realtors get priority invitations to new building sites so their clients have first dibs on the sales release at a preview event. This event takes place prior to the building going public and is where the ‘premium suites’ get snapped up.

There is much more I could say about new construction so please feel free to contact me anytime as I would be happy to discuss the whole process with you, and if you are thinking of buying a new condominium at a pre construction site, make sure you take me, Geon van der Wyst of PropertiesInStyle along as your consultant and get the premium unit for your investment.