What is the Process of Buying a New Pre-Construction Condo?
If you’ve never purchased a pre construction condo, understanding the process can be a little difficult for some. Although the process differs from purchasing a resale house, it is simple and easy once you know the basics. Here is an explanation of the general steps involved when purchasing a pre-construction condo.
1. Select the Project
When purchasing pre construction there are a number of important things to consider. Right off the bat, you want to make sure you pick the right project. Are you purchasing for your own end-use, or are you purchasing it as an investment? If the unit is for yourself, you want to make sure it has the right layout, amenities and conveniences that make sense for you. If you’re looking for an investment, a greater consideration should be placed on location, prospective rental income and so on.
2. Select the Suite
Once you’ve determined the right project for you, you need to select a suite. Here you will look at the floor plans, views, prices, and floor premiums. Again, weather you are purchasing for end-use or as an investment may affect which suite you are going to choose.
3. Submit a Suite Reservation Form
Now that you’ve narrowed down your choice, it’s time to submit a reservation form. At this step of the process, your sales agent or broker will assist you with completing the suite reservation form and take a copy of your ID. Here is an example of an online suite reservation form. Submitting a reservation form does not mean that you’ve purchased a condo unit, it is simply “reserving” a unit for you until you come into the presentation center to sign an agreement of purchase and sale. This also gives the builder time to prepare the necessary paperwork and keeps your waiting time at the presentation center to a minimum when you come in to sign.
4. Suite Reservation Confirmed
Your reservation now needs to be confirmed with the builder, that the suite, floor and price you have selected is available. Once you have agreed upon this, an appointment will be booked to have the documents signed.
5. Sign the Agreement
The time has come for you to sign for your new unit! You will come to the presentation center, with your cheques and ID, where you will sign the Agreement of Purchase and Sale. This will outline all details that have to do with your unit, including any parking spots and lockers included in your purchase. Your sales representative will be there to guide you and answer any questions you may have about your new purchase.
6. 10 Day Rescission Period Begins
The 10 day rescission period has now begun. You will have 10 days to review your purchase and to arrange your finances. Here is an article on the 10 day cooling period with detailed information. During this 10 day period, you may cancel your purchase with NO penalty.
7. Firm & Binding Deal
On the 11th day, the deal will automatically go firm and your first deposit cheque will be cashed. You are now responsible to make sure that your deposit amounts are in your account by the deposit due dates.
Your condo unit may be later assigned to someone else, or will be yours to close upon when you’re finished. You can also check out more information on condo assignments.
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This information is provided for general information purposes only and is not to be relied upon or construed as legal, real estate, or other professional advice or opinion. We do not make any representations or warranties, express or implied, as to the information provided. Under no circumstances shall we have any liability of any kind for the accuracy, use, or otherwise, of this information, all of which is provided. Any reliance you place on such information is strictly at your own risk and liability. Clients are strongly urged to seek professional advice on specific issues.