We’ve talked about neighbour etiquette, how to throw parties in tight spaces and how to make the most of a wee patio in this column, but now it’s time to get down to serious business: how to buy a condo.
Sure, there are some seasoned real estate pros out there – but for every one of them there are five nervous new homebuyers confused as hell. We’ve turned to local real estate agent Mitch Parker (mitchparker.ca, @MitchParkerRE on Facebook, Twitter and Instagram) to help calm your nerves and provide tips to ensure your next condo is really a place you want to call home.
How should people in the market for a condo go about looking for the right real estate agent to represent them? What are some important qualities to look for in an agent?
The most important thing is to work with an agent who has experience with condos, which are very different from houses. You want to find an agent you are comfortable working with and feel is looking out for your best interests. Don’t be afraid to meet with more than one and interview them for the position.
Buying into a pre-construction condo can be scary, since there’s no way to really see the building or unit before it’s finished. What is your advice for buyers contemplating this?
Similar to the previous question – ensure you are working with an expert. Pre-construction condo contracts are much more complicated than resale agreements, and sales centres are designed to sell you. The last thing you want to do is buy a poorly located unit or pay thousands of dollars more in closing fees than other buyers.
You’ll also want to have a real estate lawyer review your contract in the first 10 days after your purchase. Along with the agent, a lawyer will work on your team to ensure you’re getting the best possible terms.
Buying into an existing building can also be intimidating. What questions are important to ask?
Being able to see the unit in person is obviously a large advantage over buying off-plan. When looking, buyers should think not only about what their needs are now, but what they’ll be a few years down the road. Your agent should show you comparable sales at condos in the area so you don’t overpay for the unit.
Find out things like if the building houses mostly owners or tenants, if the condo corporation is in good financial standing and if the infrastructure is capable of handling the building size (e.g., has enough elevators). Speak to people who live there and get their opinion. You’ll quickly learn whether it’s a place you want to be or not.
What are some checklist items or questions potential condo buyers often forget to ask but should?
One of the most important things is to know how much it will cost to carry the unit (mortgage, taxes, condo fees, utilities), not only at today’s interest rate but at one that is higher as well. This helps prevent clients from stretching too far financially and running into trouble.
Is the old advice that real estate is all about location, location, location really true when it comes to condos? How do you recommend that buyers evaluate a prospective neighbourhood?
Location is definitely important, but there’s more to it than that. Buying a bad unit in a great location and buying a great unit in a poor location are both equal mistakes. Investors should definitely be looking for things like public transit, access to highways, grocery stores and entertainment close by. End users want to ensure it’s convenient for getting to and from work and fits well into their lifestyle.
Can you predict any emerging hot neighbourhoods for the next few years?
The eastern part of the downtown waterfront is on my radar as up-and-coming. It’s about to see a massive revitalization. The latest master plan shows high-end retail similar to Yorkville, multiple residential towers and commercial office space being built.
What should buyers who want to use their condos as rental properties take into consideration? How can they make sure to maximize their investments?
Renting a property takes work. Be prepared to either manage your property manager or know that you may get calls at 2 am with a flooding toilet if you decide to manage it yourself.
Make sure you speak to an accountant and real estate lawyer, as there may be income tax implications on rental income and HST payable on pre-construction units. Real estate makes for a great investment if done properly and an expensive one if done poorly. Ensure you know these things ahead of time.
Developers spend a lot of money on advertising and marketing. What’s the best way to research a developer’s track record and see beyond the hype?
When buying from developers, check out their track record. What have they previously built? Are people living there happy with their purchase? At the sales centre, walk the area around the building and feel the vibe. Check to see if there are any other buildings coming up that may block that great view you just paid a large premium for. You will also want to compare prices of the project with existing prices in the area to see the value you are getting when buying there.
