One of the biggest financial investment in Canada is the purchase of pre-construction condo. Particularly, in Toronto, the pre-construction condominiums are the talk of the town. This is because there is a huge demand for these projects throughout the year. If you are interested in buying a pre-construction condo in Toronto, you should know that the purchase process is a bit unique.
You should first understand that the pre-construction condominiums are not yet built. So, the purchase that you make is based on the concept that is perceived on the looks of the final building. Also, unlike when purchasing a freehold building, you are required to pay for its maintenance and other amenities. This is the reason why I have compiled this ultimate guide to buying pre-construction condos in Toronto. Keep reading this com[comprehensive guide so that you make an informed decision before jumping into any commitment.
Deposit
The buyers of the resold condos in Toronto often offer a down-payment deposit of 5% when signing the contract. The contractors need more money to buy and facilitate the construction. About five thousand Canadian dollars are needed during the signing of the agreement. Then the remaining amount to the first 5% should be paid in prompt within fifteen days after the contract is signed. After the deal is sealed, there are several ways in which the remaining amount can be paid. Make sure you have the money to pay the construction contractor. The amount is relatively larger for the pre-construction condos.
Reconsideration period
After signing the agreement and paying the deposit, you will have a ten-day Off Period. In most states, the buyer is given about ten days to reconsider if he or she is comfortable with the purchase. Also, you should note that the days followed herein are all the days of the week and not the official working days. During this cooling off days, you are supposed to acquire a financing pre-approval. After that, you should the contract being revised by your lawyer. If you want to withdraw from the contract within this period, your money is given back without any deduction whatsoever.
Waiting period
The contract provides that the construction contractor should state the date of building completion for the condominium. However, you should note that few of the condos are completed within the stipulated time. Delays are allowed for the reasonable instances, and consequent penalties are outlined in the agreement that you sign. Most condos take the first six months to the twelfth month of the year. And when there are delays, they can take up to two years.
Change
The condo builders have their right to do some changes to the building after, it has been presold. The buyers are protected from any material change in the process of construction. Therefore, make sure that you read and seek an interpretation of the sales agreement. This requires you to be flexible in the reselling process.
Interim occupancy and registration
Once the building is complete, it is fit for interim occupancy. You can take possession at this period, but you do not yet own the property. You should then pay the building contractor an amount that carries the mortgage and taxes. At this stage, the land transfer has not yet been done. After this, an inspection should be done by the city authorities for it to become a legalized entity. Then it becomes officially registered. And the ownership is transferred to you, the buyer.