5 Shares

Should you buy a condo from a builder?Everyone knows that new Toronto condo developments are a hot commodity. Depending on which numbers you believe, there are between 132 and 172 new condos under construction right now.

If you’re thinking of buying a pre-construction condo in Toronto, you’re probably wondering if you should use a Realtor or go it alone. Of course, we’re biased (we are Realtors after all)…but here’s the case for using a Realtor:

  • Many Buyers buy directly from the Builder, but the sales guy at that gorgeous model suite works for the Builder, not for you. His job is to get the highest price and the best conditions for the Builder. He doesn’t care if you don’t get the best price, or if you sign a contract that restricts your ability to resell or rent the unit–he works for the Builder, not for you. How can that be a good idea?
  • Yes, when you use a Realtor to buy a pre-construction condo, we get paid (imagine–we get paid for our work!). But don’t be fooled into thinking that if you don’t use a Realtor, that you’ll pocket the money we would have been paid. That money will go to the Builder’s sales team (or maybe the Builder himself). Have you ever heard of a Buyer getting a discount because they didn’t use a Realtor? Me either.
  • Buying a pre-construction condo is complicated and there are a lot of legal intricacies and details involved–just ask all the Buyers at the Trump Tower who just found out they signed contracts that barred them from selling their units before completion, or all the Sellers getting surprise HST bills when they flip their condo before closing.
  • By the time a new condo project goes on sale to the public, most of the good units are already sold–in fact, we routinely see condos or lofts that are already 50% sold  by the time of the public opening. The ONLY WAY to get the best units (high floors, best layouts, good views) is by partnering with someone who has VIP access to the condos BEFORE they go on sale to the public. And if you’re working with the right VIP Realtor, you should get special VIP pricing and upgrades too.
  • Yes, Builders are notorious non-negotiators. But there ARE things that a knowledgeable Realtor can negotiate for you–from upgrades to a cap on your development closing costs (See? you probably didn’t even know that closing costs for pre-construction condos can be thousands and thousands of dollars more than a resale a condo and they CAN be capped)

If you decide to use a Realtor to buy a pre-construction condo in Toronto, make sure you partner with someone who knows pre-construction and knows the particular project you’re interested in. They’ll know the good buildings, the good builders and can walk you through what can be an intimidating process.

Comments

  1. Brenda Boulet says:

    Wow I should have read this before I bought my condo. I used the builders real estate agent and I think that should be disallowed. Whatever happens the agent is always promoting the builders position.
    Lesson 1 – get your own agent
    Lesson 2 – the agent is a salesperson – don’t believe the possession date they say is feasible. . They want an occupation date so you can pay the builder rent until the title passes. Add up to a year to your offer date.
    Lesson 3 – they will delay the project and try to get the cheapest labour.
    Lesson 4 try not to get ulcers.

  2. I wish I had read it too. Could the real estate agent not off forewarned us about closing costs too!!! Our closing date has been delayed 6 months so we are now forced to sell our current condo in the winter market and it is also a in down spiraling market. We are so uncertain now if we can sell our condo in time to get the money to pay for the new one and being older seniors (85 and 80) don’t think we would be eligible for another mortgage anyway. We have one still on the current condo. So how are we supposed to carry taxes and condo fees on two places.

Leave A Comment

Your email address will not be published. Required fields are marked *