Pre-construction refers to purchasing a property, such as a condo or single-family home, that has not yet been built. This allows buyers to secure a property at today’s price with the potential for future appreciation by the time it is completed. Pre-construction projects offer modern design, customizable features, and a flexible payment structure, making them an attractive option for both homeowners and investors.
Once you’ve selected a unit, you’ll sign an Agreement of Purchase and Sale (APS). In Ontario, you are granted a 10-day cooling-off period, during which you can review the contract with your lawyer and make any changes or withdraw from the agreement if needed.
Pre-construction purchases require a deposit structure, usually spread out over several months or years. This makes it easier to manage the financial commitment. Typically, 15-20% of the purchase price is required before completion.
An assignment sale allows you to sell your pre-construction purchase to another buyer before the property is completed. This can be advantageous if the market has appreciated, and you can potentially make a profit without taking possession of the property.
Once the building is registered, your final mortgage and closing costs, such as land transfer taxes and legal fees, will be settled.
After the closing, you can take possession of your brand-new home or condo!
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