Buying a Preconstruction condo in Toronto is no big deal for there are many options available to you. However, you need to be prepared for a few things in advance.
15 to 20 percent down payment
The standard down payment for most of the pre-construction condos in Toronto is 15 to 20 percent. Nevertheless, you can pay up 5 percent initially and make the balance payment in installments until closing.
There might be delays
Not all pre-construction condos Toronto are ready to move in. Most developers may not be able to deliver within their ambitious time-frames. If you are not so lucky you might have to wait for about six months or so from the original move-in date. It is always better to have a backup plan in case it takes more than a year or two before you can move in.
You may have to lock in your mortgage rate beforehand
Most developers work with their own mortgage providers. So if you are thinking of buying a preconstruction condo in Toronto it is better to lock in your mortgage rate as early as possible. Make sure you understand their terms and find out if you qualify. It’s also important to trust a reliable company when you’re condo-hunting. If you’re looking for condos in specific areas like Scarborough, for instance, sites like CondoWizard can help you pick out the best units.
You may have to pay up HST
While resale condos may not attract HST, pre-construction condos in Toronto are subject to HST. Nevertheless, most purchases qualify for the HST New Housing Rebate program.
Pre-construction condos in Toronto might include extra closing costs
One thing you need to check for, while buying a preconstruction condo in Toronto is the closing costs. Go through the terms carefully and find out what you need to pay for, before finalizing on a developer. There could be utility connection fees, new appliance fees, and various other adjustments that might add to your purchase price.
What you see might not be what you get
In most cases the buildings may not be the way you saw them in the model show rooms or videos. Developers do amend their plans once in a while. The rustic-urban red bricks that looked so good in the video might end up a chic-grey and the pool that you expected to see can end up fully closed. You will have to be prepared for surprises and be flexible when it comes to buying pre-construction condos in Toronto.
You might have to be a tenant for some time before you own your condo
At times developers set up buildings as condo corporations and allow buyers to move-in to their condos before the building is complete. In such cases you will be renting your unit from the developer instead of owning it and making your mortgage payments.
There might be an increase in condo fees
A low monthly maintenance fee is often a tactic that condo developers use to entice potential buyers. However, after two or three years of staying in your home, there are chances you may have to pay up higher fees. It is always better to be prepared for such changes.
Buying pre-construction condo in Toronto might be an expensive affair. Luckily you can change your mind at any point of time in case there are any drastic circumstances such as an injury or loss of employment. If you do it within the specified “cooling off period,” you can get the entire deposit back. Do all the research you can and make sure your condo gives you excellent value for money.
