Paying for a home before it’s built can seem like a backwards procedure, but purchasing a pre-construction property can be a great real estate investment. Unfortunately, there are several myths surrounding the pre-construction market that cause many prospective buyers to feel skeptical. We’ve debunked the five most common myths about pre-construction condo investments to help put your mind at ease.

1. Pre-construction Condos Are Not Affordable

The most common misconception surrounding pre-construction condos is that they’re simply too expensive of an investment for the average buyer. Despite this, buying a pre-construction condo can actually be a less expensive option to purchasing a move-in ready house, particularly in Toronto. With the ever growing supply of condos in downtown Toronto, the market continues to become more and more affordable for first-time home buyers.

Purchasing property early in the development phase also allows buyers to take full advantage of the lowest pricing before the inevitable value appreciation of the property. Additionally, the extended closing period of a pre-construction property allows for more time and breathing room before you are expected to provide a down payment.

To determine affordability, most development company websites feature tools to help you calculate the total cost of your property investment in accordance with your financial situation.

2. Developers Don’t Care About Their Buyers

While there are condo builders whose objective it is to make quick money, assuming that all developers are this way is a disservice to yourself as a buyer. You can avoid wondering whether your developer has your best interests in mind by doing adamant research on the development company beforehand. It’s important that you gain an understanding of their reputation by speaking with past buyers; in addition, you can visit the company’s existing properties and read online reviews in order to ensure that you receive the customer care you deserve.

3. Your Pre-Construction Condo Won’t Be Ready In Time

Experiencing delayed move-in dates is a common misconception that surrounds pre-construction property investments. The idea is that when you purchase a condo during its stages of planning and development, you won’t be able to move in on the date you want.

While this can happen at times with new condo developments, it’s uncommon, especially when you’re working with reputable condo developers. Top-rated condo developers will always strive to stick to their deadlines and regularly alert you of any unforeseen changes. Make sure you confirm the history of the builder in online directories prior to buying pre-construction condos to avoid any delays. If you’re considering purchasing a pre-sale condo from a reputable developer, a delayed move-in date shouldn’t deter you.

4. You Could Lose Your Pre-Construction Deposit if the Developer Folds

Although its rare, developers have previously filed for bankruptcy and this is where the myth originates. However, to counteract the misfortune of this unlikely event, the government in Ontario has regulated the Tarion Warranty Corporation to offer protection to every new home buyer.

When purchasing pre-construction condos in Toronto from a top-rated developer, your buying costs will include an enrollment fee that offers deposit protection of up to $20,000. Thanks to this necessary safeguard, the financial loss is much less significant than losing a full deposit in the event that a condo project fails.

5. Developers Will Charge Hidden Fees During Final Closing

In addition to the general cost of ownership, property taxes, utilities, maintenance costs and more, there are also closing expenses included in the cost of a new condo development. Closing expenses include meters, warranty fees, administration fees, transfer taxes, legal fees and development levies.

While it is a common misconception that developers will charge surprise costs at closing time, a high-rated developer will never try to hide additional expenses and will instead work to include any extra fees into the selling price of the property.

Consider this during price evaluation. If one developer appears to be more expensive than the others, it could mean that they have included all the costs in the price while the others have not.

Whether it’s affordability, hidden costs, or extended waiting periods, you can consider these myths debunked when you are purchasing a pre-construction condo from a reputable developer. A trusted developer like Solmar Development Corporation ensures you are given the transparency, quality and customer care you deserve.