Understanding Pre-construction


Are you thinking of purchasing a pre-construction condo as an investment? If so, GTA is a great place to do it. With an impressive number of new buildings slated for construction—and plenty more in the pipeline—this city is full of great opportunities for real estate investors.

While the search for the right pre-con unit can be exciting, it’s not the same as hunting for a resale condo. To make a successful purchase that will provide attractive returns in the years ahead, it pays to understand the process—inside and out. If you’re ready to make your first pre-construction condo investment in Toronto, here’s everything you need to know…

Why pre-construction?

Toronto real estate: great in the long term

Like resale units, brand new condos in Toronto benefit from the city’s impressive appreciation rates. Based on long-term data, you can typically expect your property to appreciate by around 5 percent per year—though that number has been higher in recent years.

 

Pre-con, low-maintenance

After the initial agreement is signed, you likely won’t need to put a lot of effort into your pre-construction investment during the first few years. If you manage your property efficiently, it can remain relatively low-maintenance during the time that you rent it out and you won’t have to worry about unexpected things like leaks to the basement.

 

Great return, less risk

Investing always comes with some degree of risk. Fortunately, pre-construction units tend to be less risky—and better in terms of performance—than other types of investments, such as stocks and bonds. Condos are also more affordable than houses so a right condo purchase will hold it’s value better during the market and economic downturns better than most other investments.

Build your equity

Unlike rent, the mortgage payments you make on your unit will allow you to build equity. The result can be a significant influx of cash when it comes time to sell.

 

Contact our experts for personalized advise and real estate investment planning. Call 416-878-0749 or Register here.

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