There are many advantages of buying pre construction and it can be a great way to start building your real estate portfolio. There’s several factors that go into a successful buying process. If you’re thinking about buying pre-con but have no idea where to start or look, stay a while – we’ll walk you through it. Here are some reasons why you should consider buying pre-construction.
More time to pay deposit
If you don’t have tens of thousands of dollars lying around (which many people don’t), pre-construction is a great way to begin your real estate journey. A deposit for a pre-construction project typically ranges from 15% to 20%, spread out over an extended time period. This phased payment structure eases the financial burden on buyers, making it much more manageable than a lump sum payment for an already built property.
There is also a 10-day cooling-off period after signing the contract, during which you can have a lawyer review the agreement and choose to walk away from the deal.
Hands off process
Unlike flipping resale properties, the process of buying pre-construction is pretty hands off. As long as your finances are in order and deposit payments are made on time, the builder handles the rest.
Once construction is complete buyers can engage a qualified realtor to handle rental transactions if you’re an investor. That means, money in your pocket with minimal effort on your part.
Also, new construction homes in Ontario benefit from a full warranty, called the Tarion Warranty, providing coverage for up to seven years. This warranty ensures that any maintenance issues within the initial years are the builder’s responsibility.
Brand new
Being the first occupant in a newly built property means everything is brand new. Being able to select your finishes or upgrades lets you add a personalized touch to your property. If you’re an investor looking to rent out the property, you have the advantage of getting to charge a premium for your unit.
Also, many pre-construction condos are located in areas that still have a lot of growth potential. This means, you get dibs on a location that might be a prime spot in the years to come.
On the other hand, resale condos may lose appeal as they age, with rising maintenance fees, outdated designs, and the expiration of warranty programs.
Appreciation/growth potential
Investing in a pre-construction condo offers stable long-term advantages. While there may be ups and downs in the interim, real estate has historically been a stable asset class, generally appreciating in value over long periods of time. Choosing properties in neighborhoods with planned infrastructure or transit development can significantly enhance appreciation potential.
Not to mention, Canada’s growing population and high immigration levels means there is a strong demand for housing, contributing to the appreciation of property values over time.
Looking to invest?
Pre-construction is one of the multiple ways to build a real estate portfolio and at Condos Global we believe the purchasing process should be easy and seamless.
Interested in buying pre construction? Check out some exciting up and coming projects on our site.