Do you need a Realtor when buying pre-construction?
The answer is absolutely YES!
Firstly, if you're interested in the initial launch of new construction, having a realtor who has access to the sales division within their team that focuses on pre-construction opportunities is crucial.
Secondly, having a realtor represent your pre-con purchase at any time can add beneficial terms to the agreement. Not every Realtor has experience in pre-con so make sure to ask that they do.
Considerations for buying a new build
- There is no recision period anymore on new builds unless it is a condo (i.e. has a common element fee)
- Interim occupancy timeline? essentially renting from the builder 4-12 months - pays rent to builder until condo corp is registered with city
- Is there a Tarion warranty on the home?
- Capped development fees? 5k-10k (hydro hookup ect.)
- Parking and locker (pick close to elevators)
- Land Transfer
- Closing date - does the builder have a record of delays?
- Taxes on close. How will you designate the property?
- Deposit structure
- Premium: Assignment allowance usually around $5-15K - this will alleviate all the costs of closing if it is a quick flip.
- Is there room to negotiate? If so, its best to build in extras you would like into the price. They dont cost builders much and they like to keep up the sale prices. Also at design centers you cannot build these amounts charged into the mortgage as they are billed separately
- Are the views and land surrounding the property protected. I.e. if its on a ravine, is that ravine protected by conservation authorities ect?
- Does the builder negotiate?
- Are you in early enough to take advantage of builder incentives?
Check and double check.
For a condo, check with your lawyer on your right/ ability to delay the closing date if the registration has not been completed by the occupancy date (i.e. interim occupancy)
***When you buy a new build its a good idea to have a home inspection done, do it at approx 6 months into owning the home so that you can make the arrangement with the builder to take care of all the items as they would be covered under the Tarion warranty