How to Buy a Presale Condo or Townhome

Buying a pre-sale condo or townhouse in British Columbia involves purchasing a unit before it is completed, based on the developer’s plans and models. This can be an exciting opportunity to buy a brand-new home, often at a competitive price, but it comes with its own set of considerations and steps. Here’s a guide to help you navigate the process:

1. Research Developers and Projects

• Developer Reputation: Investigate the developer's history and reputation. Look for reviews, past projects, and whether they have a history of completing projects on time.
• Location and Amenities: Consider the location of the project, nearby amenities, access to public transportation, schools, and other important community features.

2. Understand the Purchase Process

• Visit the Presentation Centre: Pre-sale properties are typically marketed through a presentation center where you can view models, floor plans, and finishes. Ask for a comprehensive package that includes all the details of the project.
• Legal Representation: It is highly recommended to hire a lawyer experienced in real estate to review all contracts and disclosure statements before you sign anything. They can help clarify terms and identify any potential issues.

3. Review Disclosure Statements

• Developer's Disclosure: This document is crucial as it provides detailed information about the development, including plans, layout, bylaws, and budget projections. Make sure you understand every aspect of what is being promised.

4. Secure Financing

• Mortgage Pre-Approval: While the full mortgage might only be necessary upon completion, getting pre-approved early can secure your financial planning. Note that the final loan will depend on both your financial status at the time of completion and the property’s finished value.
• Deposit Structure: Pre-sales often require a deposit paid in installments. Understand how much and when these payments need to be made.

5. Consider the Completion Timeline

• Project Delays: Be aware that construction projects can face delays. Make sure you have flexibility in your living arrangements and financial planning to accommodate such delays.
• Occupancy vs. Completion: Initial occupancy does not mean the building is legally yours; the full legal transfer (closing) happens after the development is formally completed.

6. Understand Your Rights and Obligations

• Cooling-off Period: BC laws provide a 7-day rescission period after signing the purchase agreement, during which you can cancel the contract without penalty.
• Warranties and After-Sales Support: Be aware of the new home warranty (commonly the 2-5-10 warranty) that comes with new constructions, covering various elements of the building and individual units.

7. Plan for the Future

• Market Fluctuations: The real estate market might change between your purchase and the project's completion. Be prepared for both positive and negative shifts.
• Assignment Clause: If your plans change, check if you can sell your contract (assign the pre-sale) to another buyer before completion. There may be restrictions or fees involved.

8. Stay Informed

• Regular Updates: Request regular updates from the developer to keep informed of construction progress and any changes to the original plans or timelines.

Purchasing a pre-sale condo or townhouse in BC can be a great investment or a pathway to home ownership. It requires thorough research, careful financial planning, and a bit of patience. With diligent preparation and professional advice, you can navigate the process more smoothly and make informed decisions.