Presales have been a hot topic in the last few years in terms of the real estate market. Many investors and avid home owners continually talk to their realtors and browse the web to find the next big project. One question we get asked frequently is “Why is everyone buying a presale and what are the benefits?”
Before we get into why presales could be a good investment, we must first define what a presale is. A presale is an apartment, a condo, or a townhouse that is introduced to the market before construction has been completed. Depending on the build of the project and the developer, a presale could take up to 1 year or up to 7 years to complete. Therefore, it is essential to talk to a competent real estate agent to help strategically plan your intentions with the purchase of a presale.
In terms of the benefits of a presale, they are great investment opportunity in so many different aspects. Here are a couple reasons why we think presales are beneficial:
- Presale is Brand New
You do not have to worry about any defects or damages left by the previous owner. A presale unit will always be brand new, meaning you will be the first person to step foot in the unit.
- Customization
When a presale is purchased, you are able to choose the specific customized finishes and colour scheme that appeal to you the most. In other words, it is very unlikely that you will need to spend extra money and time to renovate your home. In some instances, developers may allow you to purchase extra parking units or storage for further customization.
- Get a Behind the Scenes Look
When purchasing a presale, you are able to receive an exclusive look on how the project could potentially turn out. Developers will typically have a presentation center or detailed renderings for you to take a closer look at the finished product. Furthermore, many developers will have a very knowledge sales team to provide you with all sorts of information about the project for you to make an informed decision.
- No Mortgage Required
In a presale, you are not required to pay the full price upfront when you acquire an allocation for a unit.
Because a presale could take a couple years, you are able to save extra money. You are only required to pay a deposit, with the rate depending on the specific area, build quality, developer, and time frame of the project. When purchasing a presale, we highly recommend you talk to a realtor and understand the deposit structure of the specific project.
- Warranty
Once you purchase a presale, you get the 2-5-10 warranty. Warranty would include material and labour for a maximum of two years, water and penetration for 5 years, and any structural damages of the home for 10 years. In addition, all new appliances have a 1 year warranty for any damages.
- Hopefully a Significant Capital Appreciation
When you purchase a presale, it could be a couple years before completion. The price you sign in the contract will be locked and completed at the time of signing. This gives you an opportunity to raise your capital and benefit from an appreciating real estate market when the construction is finalized.
If you have any further questions about presales and why it may be the perfect opportunity for you, feel free to contact us and we would happily assist you.
Thank you,
MC Real Estate Group
Melvin Chan PREC* | (778)-709-7018
Milton Chan PREC* | (778)-709-7016
Ethan Chan | (778)-985-8388