- May 7, 2018
- Posted by: @dmin
- Category: Uncategorized
Preparation For Buying a Condo
Buying a new condo in Ontario can be an exciting undertaking. But first, make sure you have a thorough understanding of the process, relevant rules and regulations, and that you know what to look out for before signing on the dotted line. It’s the best way to ensure that you get the most out of your investment!
There are two critical phases to the purchase process when buying a new condo unit in Ontario: pre-purchase and purchase/post-purchase. Before you buy, it’s essential that you get expert advice so that you can make an informed purchasing decision. And during the purchasing process itself, make sure that you consult the checklist below so that you aren’t faced with unpleasant or possibly costly surprises down the road.
Before You Buy a Condo
There is a complex web of legal and financial issues surrounding new condo sales, and taking the time to ask the right questions will arm you with the knowledge you need to make the best possible choices.
And while many purchasers deal directly with the condo developer’s sales agents, it may be prudent to engage a real estate agent’s services to help negotiate a better deal on options and amenities and to keep you informed about anything you may otherwise miss.
Questions for your realtor
- How much experience do you have with condominiums?
- Have you dealt with this developer before?
- Are you knowledgeable of current condominium-specific regulations?
- How familiar are you with the area/neighbourhood?
- How much time will I have to review condominium purchase documents?
- What types of purchaser protection clauses in condo purchase offers?
- What types of fees will I be responsible for?
- Are there any hidden fees of which I should be aware?
- Do you plan to negotiate where possible, such as for upgrades or options?
- What are my estimated property taxes?
Questions for Your Lawyer
- How much experience do you have with condominium transactions?
- Are you knowledgeable of current condominium legislation?
- Have you dealt with this developer before?
- Which new condo purchase agreement clauses tend to be the most problematic?
- Do you anticipate any closing issues?
- What documents do you need from me?
- Are there any hidden legal liabilities of which I should be aware?
- Which fees are payable before closing and after?
Questions for Your Financial Advisor
- Is this affordable for me?
- What are my down payment requirements?
- What are my mortgage rates and terms?
- How will I be affected by changes to interest rates?
- What are my amortization payment options?
Condo Purchase Checklist
Once you are armed with legal, financial, and real estate advice, make sure you cover these points before signing a purchase agreement.
|Purchase Inclusion||Determine exactly what your new condo purchase includes, and what is excluded. Ensure you understand exactly which costs are your responsibility and which ones are to be borne by the developer.|
|Verify Warranties||While your new condo will be required to carry some kind of warranty guarantee, make sure you verify exactly what is covered as well as the coverage duration.|
|Occupancy Fees||If you plan to move in before the purchase transaction is completed, the developer may charge occupancy fees. Ensure you have a clear understanding of these.|
|Disclosure Statement||The developer is required to provide you with documentation called the Disclosure Statement, which will also include the Condo Declaration outlining how the condo is to be run and managed. Read these documents clearly.|
|Project Completion Date||Condo developments are often delayed for a variety of reasons. Find out if the purchase agreement allows the developer to extend the occupancy date without penalty.|
|Verify the Dimensions and Boundaries of Unit||Make sure the unit dimensions and boundaries are clearly specified in the sales agreement.|
|Flexibility for Changes||In the event that your needs change during the construction phase, find out in advance whether changes to walls and layouts are possible, along with the costs to do so.|
|Accessibility||Determine if your building or unit will be accessible to individuals with limited mobility.|
|HVAC||How will your units be heated and cooled?|
|Utility Agreements||Determine whether utilities are billed directly or if they are shared.|
|Water Heater||Will your water heater be leased or is it included in the purchase? Many new homeowners are shocked to find themselves locked into expensive water heater leases.|
|Verify Finishes, Options and Amenities||Ensure you know exactly which finishes are to be included and that any options, upgrades or non-standard amenities offered are specified in the purchase agreement.|
|Verify View||Ensure you know what type of view you can expect.|
|Noise Reduction Measures||Does the construction include noise reduction measures to ensure you aren’t unduly affected by noise from other units?|
|Future Construction Plans||Check with the developer and your municipal government about plans for future development in the area. This will allow you to know what kind of future growth your immediate area can expect over the coming years.|
Do Your Due Diligence Before Purchasing a New Condo
Buying a new condo in Ontario is quite a bit different than purchasing a resale unit. Since new condo units are sold by the developer, usually before construction has been completed – or even started.
The Ontario frameworks governing new condominium sales – the Condominium Act, the Condominium Management Services Act, and Tarion (formerly known as the Ontario New Home Warranties Plan) – all have varying levels of responsibilities and remedies for new buyers. These will outline who is responsible for what, and it’s important that you familiarize yourself with these pieces of legislation to fully understand your rights and responsibilities.
Doing your due diligence is critical to a satisfactory new condo purchase. And remember – if you change your mind, the law tries to protect you from buyer’s remorse by giving you the right to cancel the purchase within 10 days of receiving the purchase-sale agreement.
ICC Property Management is the leading property management company in the Toronto area, offering a full range of building administration and management solutions designed to ensure condo owners maximize their property value and living quality while bringing communities closer. Contact our award-winning team today for a free proposal and to learn how we can bring property management excellence to your condo.