Buying a New Condo: It's the Coolest

While not everyone in this city is enthusiastic about the chance to buy a pre-construction condo, the fact is, new condos make up a growing portion of the condo market in Toronto and they have that undeniable 'cool' factor by virtue of their newness.

Buying in the pre-construction phase is a great option for many buyers because it affords you plenty of time to plan for your move and it is usually a good place to 'park' your money for a year or two.

What most people don't realize about buying a new condo is that when you walk into a sales office and they ask you to 'register' with them, what you are really doing is entering into a binding contract with the developer that effectively makes them your legal representative on the sale. I always tell my clients that if they visit a sales office without me, make sure they make it clear that they are already represented.

So, if you are thinking about purchasing a pre-construction condo or buying directly from a developer, here are a few reasons why you should have an independent real estate agent representing you on the sale.

1. Price. Most people assume that the advertised price on pre-construction condos is non-negotiable, and everyone pays the same price. However, often developers will issue special pricing and/or incentives exclusively to agents and their clients.

2. Terms. Terms of the agreement may also be negotiable such as time given for the initial deposit. Usually developers insist on something like 5% at signing, 5% in 30 days, and 5% in 60 or 90 days. An agent may be able to negotiate these terms to take the sting out of initial deposit.

3. Builder Reputation. New builders/developers are emerging every month in Toronto, each trying to get a piece of the booming market for new condos. Are you going to trust the sales person who tells you that the builder has an impeccable reputation? It pays to have someone who has an insiders' knowledge of the various builders in the city. Not all builders are created equal and who the builder is can actually have a dramatic effect on resale values.

4. The Agreement. The agreement of purchase and sale is a legally binding contract. Real estate agents work with these documents every day and can help you understand exactly what your obligations are before you sign anything.

5. It's Free. As the buyer, you pay nothing to have an agent represent you on a sale. Working with a real estate agent gives you professional representation at the negotiating table.