Are Presale Condos Still Good Investments?

Adam Parsons October 18, 2015

 
If this is 5 years ago, I might tell you that presale condos are a good way to create fast equity. By the time the building was finished, many investors had made a tidy profit, but things have changed since then.
 
Here are some things you should know about buying presale condos:
 
1. Investors were smart, but developers have also gotten smarter by raising the prices of presale condos to match resale condos in the same area.
 
2. The Canada Revenue Agency as been cracking down on condo owners, so if you try to sell, it can be shocking to learn that you have to pay HST if you didn’t occupy the unit.
 
3. Unlike with resale condos, you don’t know when presale condos will be finished. The developers can gave you dates, but there have been many cases of delayed construction and even abandoned projects.
 
4. Before the building is registered, you have to pay an Occupancy Fee. This is a combination of maintenance fees, property taxes and interest from any unpaid balance. Be aware that this fee does not go towards your mortgage, hence it’s other name – the Phantom Rent.
 
With resale condos, you won’t have to deal with these uncertainties. You get what you see and you know exactly when you can move in.
 
If you must buy a presale condo, make sure you understand all the details and get help from a qualified real estate agent. A good agent can tell you about the developer’s previous buildings, how good they are with meeting construction deadlines and current market values so you can make an informed decision.

Have a question about buying a presale condo? Just ask.

Recent Blog Posts

What’s Happening in Our Market?

We just got the latest numbers from our real estate market from April 2022. Let’s take a look at what they say and what it means for the future of our market.

177 Donlea Drive Is a Gorgeous Property

Today I’d like to show you a listing that we’ve just prepared for sale at 177 Donlea Drive. As you can see, it looks like a beautiful model home.

A Close-up View of Our Latest and Greatest Listing

19 Forest Glen Crescent, is a rarely available, once-in-a-lifetime opportunity to live in one of Toronto’s most exclusive and highly coveted enclaves.

Why You Should Sell Now

Why should you sell now? This simply might be the best chance to list your property in quite some time because of several key factors.

Items Buyers Should Be Cautious Of

When you’re in the market to buy a home, it’s important to look past all of the glitz and glamour to see if there are any deficiencies.

Getting the Best Value Out of Your Fixer-Upper

It can be difficult selling homes as is, but it’s certainly not impossible. Here are some tips to help you sell your fixer-upper property.

4 Buyer Tips for This Market

Homes are selling within three to four days on the market, so you need to go in and see the properties right away.

3 Things Buyers Want Most

Since the pandemic began, what buyers are looking for in homes has changed. Here are the three things they want most right now

Q1 Toronto Region Market Update

A balanced market has around six months of inventory, so you can see in the chart above that inventory is extremely low.

Work With Us

We bring unmatched market knowledge, dedication, and personalized service to help you achieve your real estate goals.