A couple of months ago, CBCs’ Marketplace had a great feature that highlighted many of the problems that buyers of new condominiums are faced with. Wendy Mesley visited a number of new condominium sales offices and actually went through the process of buying a condo, which she later rescinded, in order to see firsthand what condo buyers are dealing with. They also interviewed a number of recent condo buyers to get their opinions as well. Some of the things they found included:
- Floor plans that were smaller than what model suites indicated.
- Model suites featuring higher ceilings than those actually being sold.
- Contracts that allowed the developer to change everything from room sizes, condo layout and finishes without notice.
- Condo buyers who ended up with units that were materially different from the floor plans they purchased from (in one condo, a den became a storage closet).
Many of the things discussed in the Marketplace report are not new to real estate agents who have worked with condo developers, but it’s definitely worth viewing if you are in the market for a new condominium. The best tip in the video comes from real estate agent Charles Hanes who says:
The best advice I could give to anyone contemplating a condo purchase is to believe absolutely nothing that you hear and half of what you see.
Anyone who is planning on purchasing a new condominium should definitely consider hiring their own buyer agent to represent them (see Realosophy's HomeBuyers Guide for more on the benefits of a buyer agent). Your buyer agent is going to ask the questions that you don’t know to ask and warn you about the potential issues that the developer and sales agent may not warn you about.
If you are already in the process of buying your condo, here’s a top 10 list of things to consider before buying. The list includes tips from the Marketplace video along with a few of my own:
- Take a tape measure to the model suite.
- Compare measures with the floor plan.
- Check that the ceiling height in the model suite is the same as your unit.
- Look into the developer's track record. Knock on the door or stand in the lobby of another condo built by the same builder and ask residents if they are happy, whether they had problems, and whether they received what they were promised.
- Hire your own real estate agent (i.e. a buyer agent).
- Hire your own real estate lawyer.
- Show your lawyer your contract. You might be able to improve the contract.
- Ensure the closing costs levied by the developer are capped.
- Visit the city of Toronto’s planning department to see what other developments are planned in the area. Your great view may soon be blocked by “Phase 2” of a condo which isn’t being marketed yet and the developer never told you about.
- Believe absolutely nothing that you hear and half of what you see.