So, what’s the big attraction of the pre-construction home? There are quite a few benefits, including:
The warranty programs in Canada offer protection for new build homes, including things such as delays in occupancy and closing coverage, protection for your deposit, and the cost of repairs should there be issues in the construction of your home once you move in.
While your home is being built, it is almost guaranteed to rise in value.
No Bidding Wars
Depending on where you’re shopping for your home, bidding wars can really knock up the price. When inventory is low, buyers are desperate, and the more attractive the home and neighbourhood, the more chance there is you could end up paying an inflated price for a resale home. When it comes to pre-construction, you’re looking at a set price. You’ll know exactly how much you’ll be paying, usually at fair market value.
You have the option of designing your home with plenty of upgrades available. You’ve not only got upgrades for things such as kitchen counters and flooring but can also often make structural upgrades including adjusting some floor plan options. Because you’re making all your decisions for changes during the building process, they are far more affordable than a reno or upgrade once you move in. You can make smart decisions that will increase the resale value of your home.
Lower Condo Fees
When buying pre-construction condos, the condo fees are lower in new builds than resale condos. That is because everything is new, and the management has yet to see how much it costs to operate the building or property.
Flexible Deposits and Down Payments
Although you tend to need more for a deposit or down payment for pre-construction, the payment is staggered. You have time to keep saving as there is a small amount paid up front, and then the rest is paid on a schedule that leads up to the final closing.
You’ll have more choices when buying pre-construction compared to resale condos such as the floor of the unit and the location (i.e., a corner unit or a better view).
10-Day Cooling Off Period
You’ll have 10 days to “cool off” and reconsider your purchase. During this time, you can arrange for financing and also have a lawyer review the agreement. Should you change your mind or find something in the agreement you don’t like, you can get your full deposit back and walk away.