With Canada’s ongoing development boom, many purchasers consider buying a home or condo pre-construction, or one that’s just about to be finished. And while there are some amazing benefits to buying a home from plans or just as it’s being completed, there are a few things to take into consideration:
You’re under warranty…for a while. If you’re purchasing a new home and there are problems (anything from tile cracks to major structural damage), your province will cover you for repairs and replacements up to a certain point in time. Ontario, for example, uses a program called TARION, which stipulates which items you’re covered for, up until three years after the building’s completion. Other provinces have similar programs, so be sure to get familiar with yours.
You can live there, but that doesn’t mean construction is finished. Particularly with condo buildings, your occupancy date might not line up with the building’s completion date. This means that while your unit itself might be liveable, chances are the floors above you will still be under construction, as well as common areas. Take this into consideration when planning your moving date!
Watch out for unusually low maintenance fees. If you’re moving into a newly-built town home or condo, you might be surprised at how low the condo fees are. However, it’s somewhat common for these to increase in the first couple of years, sometimes significantly. This is because when you purchase from plans, the condo fees are just an estimate. If your building’s amenities have yet to be finished, this might also lead to deceptively low numbers. Make sure you include some wiggle room for this when you’re crunching numbers.
Your mail might be delayed. Canada post, which delivers mail across the country, has a policy that prohibits their employees from delivering mail to a location deemed “unsafe.” Most construction zones fall into this category, and it can take a while for Canada post to update this status. If you move into a building while other homes or condo units are still being built, you might find yourself picking mail up from a shipping center or post office instead.