So, an interesting development that you might have seen in Toronto real estate pre-construction news:
A new Toronto development that was meant to be built in Toronto’s junction triangle wasn’t built, and investors and prospective owners did not get the unit that they were promised.
That said, they all received their deposits back, with a small amount of interest. The point is, that this was supposed to be a landmark project by a new builder. Their first foray into the urban residential development market was a flop.
Why is this such a big deal for investors? The fact that they are now priced out of a market that they had planned to enter. With a deposit of approximately $60,000 all said and done, they lost their potential downpayments on places that were significantly cheaper at the time of the pre-sale.
This might be concerning for those looking to invest in pre-construction properties in Toronto or the GTA. Let’s take a look at the actual stats here, though:
Since 2012, only FIVE projects of the hundreds of releases in Ontario have not been built. That’s an abysmally low risk percentage over such a long period of time. That said, established builders mitigate this risk by ensuring that the necessary paperwork is filed and the requirements to build are met!
So, how can you avoid this pitfall of pre-construction? The key is learn about the builders and their track record. Ask the necessary questions. You need to know WHAT to ask when it comes time to buy and make sure the builder has all their work in order.
How can you learn about builders? The key is to do your research. There are some exceptional resources online that look at strictly pre-construction investments and buildings in Toronto. There is no shortage of reporting and builders tend to feature the projects that they have worked on.
An experienced realtor can also be a great resource when looking for a project that you want to buy in. Whether this is an investment or you plan on being an end user, this is absolutely essential.
That said, you can call me directly at 647-284-4778 if you need any help deciding whether a builder or project is worthwhile. We can take into account your ancillary costs associated with pre-construction, a historical look at the builder’s timelines and actual development costs and completion. Hopefully we can make your next pre-construction purchase a success together!