PURCHASING A PRE-CONSTRUCTION CONDO A pre-construction condo is a 5 The closing costs of a pre-construction sale are usually higher than a resale building or unit that is for sale, but transaction, and it’s important to understand has not yet been completed. There this before signing your agreement. The reason are numerous advantages to buying per-construction closing costs tend to be higher pre-construction, but doing so is because of the costs associated with new requires delayed gratification. For developments, including: the most part, the process is similar • Utility costs to that of a resale purchase, though there are some marked differences. • Land development fees / Park Levies These are the key factors we advise • Education levies you to be aware of. • Tarion warranty 1 HST is usually included in the sales price
of a pre-construction condo, but we always advise you confirm this before signing any documents.
2 After signing a purchase contract and
presenting a cheque, your transaction will be subject to a 10-day cooling off period. During this time, you should reassessyour financial status and commitment to making the purchase. If you change your mind, you are permitted to void the agreement without penalty.
3 Pre-construction purchases require a
staggered down payment that’s collected over the course of approximately a year and a half. Post-dated cheques can be given to the builder at the time of sale or at the end of the cooling period. Proof of mortgage preapproval must also be provided at this time.
4 When you sign purchase agreement, make
sure you receive a copy of the agreement and the condo disclosure, which details the budget for the first year and the common expenses allocation. We advise you have a lawyer review these documents to explain the costs and clauses outlined by the agreement.
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Lawyer fees
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Status Certificate
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Hydro meter installation
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HST on chattels, etc.
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Mortgage discharge (Builders)
In some cases, builders will cap these variable amounts. We advise you attempt to negotiate to have costs capped, as doing so may save you money, and will definitely give you peace of mind.
6 Developers determine the occupancy
date – the day you can can either move in or rent out your unit. The unit is usually complete by this time, but common areas,like hallways and shared amenities may not be. It is common for work to continue in these areas for an additional 9-12months.
7 Every purchase agreement will have either
a confirmed or tentative occupancy date. In cases of a tentative date, the builder must inform the purchaser of the occupancy date no later than 30 days after roof assembly is complete (or another predetermined construction phase). If the purchaser is not
The Bahl and Yew Team. #1 Real Estate Team in Downtown Toronto 010 2Purchasing a Brand New Condo
