Toronto is one place on earth with all the necessary amenities for great living and lifestyle. The great city offers among the best real estate condos among other units under its plate. Currently, Toronto city tops as the country’s top hub for the pre construction condo market. That means that Toronto real estate market for 2022 is buzzing with tons of units up for grabs. Therefore, if you want to secure a pre-constructed condo in Toronto for investment purposes, this is a perfect time.
But before you begin hunting for the best pre construction in Toronto, there is a list of factors you must consider. These factors will help you cruise through the process swiftly and invest in a venture that won’t be regrettable in the future.
Location of the unit.
The location usually falls among the top factors necessary when considering any investment. A location with all the essential amenities and appealing conditions will carry the day. That is because many possible clients and customers are always after real estate properties that meet all their necessities on the go. In this context, before considering anything related to condo investment in Toronto, you must first consider location.
Toronto boats an ample space which might not be too good for investment. In most cases, investing in an area with a small room for expansions is always best. Therefore, since Toronto city is so large and has lots of room for growth, you need to be wise when selecting a perfect location for investing.
Here are some essential driving factors applied when choosing a location to invest in;
- Land size
Be aware of construction delays.
Patience is always that one mantra that will never fail to be spoken in any given scenario regarding investment. The case goes a top higher, especially with real estate investment. Please have the idea of a possible delay in construction when you are planning to purchase any pre construction home.
It is never going to be a guarantee that when developers kickstart a project, it is going to thrive smoothly all at once. The possibility of a delay during the construction process must also be included. However, that is never the case on most projects since multiple ones are always on the go till the end.
There will be a reason for any halting of the construction. The common causes of a delay are weather, labor shortage, strikes, financial crisis, and supply chain delays. Just two years back, the world saw one of the worst global pandemics that shut down most development projects.
Do plenty of pre-investment research.
You must understand that investing your hard-earned cash into a pre construction Condo in Toronto is no mean affair. It is not only a run for your money but also a scary experience at the same time. Therefore, the nearest thing you have to perform is to know more about whom you are dealing with.
In this case, we are talking about the developer or the company. Always go after a builder you can trust fully and reliably to the core. Also, if a combination invests in different developers, you get quite an assignment.
Here is a quick guide on choosing the right developer before investing in a pre construction Condo in Toronto this 2023;
Check on past developments- A glimpse of the development record will be critical. By doing so, you will know about the past projects that the developer has done. Therefore, base your decision on that.
Consult with previous customers- You might also want to seek consultation from a previous customer with the developer you have eyes to work with. Getting the experience of an earlier customer with help builds enough confidence in pre construction condo investment in Toronto.
Condo investment is not a guaranteed success venture
Research shows that less than 10% of investments related to pre construction Condos make It to the success level. Having such an idea before considering investing in Condos in Toronto, Canada, will be
Getting a realtor to salvage you from any fumbled investment is wise. A realtor will help you maneuver the real estate industry well and reduce the risk of your investment collapsing. Roles played by the realtor will involve accessing the best locations to invest in, the best builders or developers, and lastly, the best units to rent out or resale in the future. Ensure you have any realtor but experience once.
Flexible payment methods.
Once you’ve decided to invest in pre construction condos, payment remains. Remember, there are multiple ways you can choose to pay. Fortunately, the good thing about investing in pre construction condos in Toronto is the smooth and flexible payment methods.
The good news now comes when the extended payment period of the warranty is introduced. Most developers always allow up to 20% initial deposit for the entire price of the unit. For instance, if a unit costs $800,000, 20% of that amount totals $160,000. The amount is further broken down into payments made annually from 3 to 5 years. That makes funding for a pre construction condo in Toronto so flexible.
10-day cooling-off window.
In Toronto, most developers have embraced a 10-day cooling period. This is a set duration that an individual is given to consider their bid for the investment.
During this period, there is a series of activities that happen. We have;
- Secure the unit
- Lawyer paperwork
- Mortgage pre-approval
- Post-dated cheques for payment
Inclusion of Closing costs.
Closing cost is an expense you will face once the final closing of a pre construction condo is attained. This is a sort of add-on expense added to the unit’s budget price. The is no fixed amount of money since the developers determine this payment.
However, here are some recent closing costs for previous years;
- 2020- Studio/ 1 bedroom- $15k- $20k
- 2020- 2 bedroom plus- $20k-$40k
Possibility of material change.
The good news is that you will be notified earlier. This clause is usually included in the agreement provided by the developer. It gives the builder extra power to change the already agreed-on amenities and floor plans.
Once you venture into pre construction condos investment in Toronto, be prepared for the project’s cancellation. It may come before construction or during construction. It usually turns into a massive disappointment to the buyers, who will eventually get a return on their deposits in that case.
Increased monthly maintenance fee.
A monthly maintenance fee comes in once the project is finished. The amount is always included in the budget but is just an approximation. The amount will rise over the years due to several issues, such as inflation.
Look no further if you are looking for the best time to buy a condo in Toronto. This is arguably the best time you got to give it a shot. Toronto is one beautiful city with lots of amenities. Investing in a pre constructed condo will mean the world since it’s an investment with which you will reap big in the future.
The city is growing non-stop, which means more and more new buyers are coming in. Purchasing a now means you get to enjoy the returns of the pre constructed condo in 2026, for instance. It is a worthwhile investment you can choose to rent out or resale shortly.