Here is Part 1 going over the FAQ’s from TheRedPin.com, an online brokerage for condos in Toronto and the GTA, as well as a hub for real estate news, updates on the latest developments, and search tools that include design, area schools, lifestyle, and builder.

What’s the difference between buying new (pre-construction) and resale?
Differences include:
1- New homes are brand new but tend to generally be more expensive than resale units.
2- New homes often appreciate in price at a higher rate than resale homes, especially in the first few years.
3- New homes are often more energy-efficient.
4- New homes let you choose your finishes and upgrades based on your own preferences.
5- You are backed by Tarion’s new home warranty program for seven years. With resale units you can see the unit you are purchasing, would not have to wait as long to move in, and would not tie up your deposit for years.

How can I secure my mortgage and is it to my benefit to get a pre-approval?
You should have a general idea of what you can afford before choosing a unit. Once you purchase, you will have to get a pre-approval from the builder’s in house financial institution and subsequently, with four months left before the final closing date you can choose to go with the institution that offers you the best rates and terms. This is a win-win situation for you, if you find a better rate you can go with it, if you don’t you already have a favourable rate secured.

What’s the best time to buy a new condo?
The best time to buy a new condo really depends on your situation and the demand for the project. Generally, the VIP pre-sell phase is often the best time to purchase as builders release some of the best floor plans at the lowest prices before opening the building to the rest of the public. Of course, the closing date is a few years away at this point. Overall, throughout the project’s lifecycle units are released, prices are adjusted, and incentives are provided at the builders’ discretion.

What are the benefits of buying a unit on higher floors?
Other than the view, one of the main benefits of buying on higher floors is that your occupancy date will be later than those in the lower floors thus you pay occupancy fees for a shorter period than other floors. On the other hand, these units are often more expensive and if you are an investor your ROI on rent may not justify the extra costs.

Does my new condo come with warranty?
All new homes sold in Ontario are backed by the seven-year Tarion “New Home Warranty Program,” with the exception of conversion buildings. The coverage includes protection against delayed occupancies (without notice), unauthorized substitutions, and defects in material. They also provide deposit protection and cover the common areas of your condo building.

Can I review the builder’s offer on my own or should I get professional help?
During your 10-day rescission (cooling off) period, we advise you to seek a lawyer’s assistance on going over these documents. You should look for items such as extra costs, delay provisions, and clauses such as assignment privileges, development charges, etc.

What are “closing costs”?
Closing costs are the amount you are required to pay in addition to the purchase price of your unit. These can include land transfer tax, education levies, new home warranty certificate, legal fees, and utility hook-ups. Keep in mind that if you have a savvy representative on your side, they can negotiate on your behalf and cap these costs at the builder’s discretion.

What are “assignments” and why should I consider buying an assignment unit?
Assignment units refer to buying the rights to an agreement of purchase and sale from a previous owner prior to the registration of the building. If you buy an assignment unit, you will get to move in relatively soon after, save on taxes such as the Land Transfer Tax, be eligible for Tarion’s seven-year warranty program and inherit the incentives that were given out to the original buyer. On the other hand, you could likely have bought the unit you are about to buy at a lower price during the VIP phase.

What is the “Disclosure Statement” and why should I care about it?
As per Ontario law, builders are required to provide you with a detailed disclosure statement in which they give a general description of the property, rules and regulation of the condo, projected budget statements, and maintenance fees for all units.

By Sam Hosseini, of TheRedPin.com

TheRedPin is the new way of searching, discovering and buying new condos in Toronto and the GTA as Canada's first online brokerage and Toronto's only one-stop condo shop.