Want to avoid bidding wars and take part in designing your new home? Buy pre-construction. Of course, like any major purchase, you need to do your research before signing on the dotted line.
First, make sure you have enough money in the bank to buy pre-construction. It’s not like buying an existing house. Instead of a small down payment, many pre-construction builders require a 15 to 20% deposit to be paid within the first year of purchase.
Next, put together an expert team. You’ll need a real estate agent who knows about the area where you’re buying and a real estate lawyer who knows the ins and outs of pre-construction contracts.
Buy as early as possible, like as soon as the project is announced. You want to be part of the VIP broker launch. That’s when you’ll get the best prices.
Keep in mind that you won’t qualify for a mortgage until your house is move-in ready, so take a good look at your finances and review potential mortgage rates with your bank or a mortgage broker.
When it comes time to design your new home by choosing finishes and making upgrades, again think about your bank account. These costs can add up. You want your dream home, but you don’t want to be house poor.
Finally, one of the best benefits of buying pre-construction is that every new home in Canada comes with a warranty. This insurance covers deposit protection, delayed closing compensation and the cost of repairs if there are any issues with the construction of your home.