Every condo launch cycle is slightly different. As developers go through the stages, they will typically increase prices and remove various incentives.
The following stages represent a typical new condo launch in Toronto, however, these stages are not mandated to be at every launch.
STAGE 1 – FRIENDS & FAMILY
At this stage the project is typically not advertised yet and is only available to close friends and relatives of the developers. There is no “event” to purchase a unit at this stage. Friends and family members will be invited to purchase before the developer starts to sell to the public.
STAGE 2 – PLATINUM LAUNCH
The platinum launch is the time for investors and end-users to purchase a new condominium with the following perks:
- Day 1 pricing, typically much lower than the other stages of a condo launch
- The best perks and incentives
- Best suite selection (the “prime units” are often sold during the platinum phase)
STAGE 3 – VIP LAUNCH
VIP Agents are those that sell pre-construction condominiums but not at the same volume as a Platinum Agent. They will be invited to the second round of sales, where prices are typically increased, some perks and incentives are removed, and the best suites are usually already sold.
STAGE 4 – TREB AGENT LAUNCH
Developers will then open up their sales to any TREB agent who may have clients. At this time, a majority of the best suites have already been sold and prices have been increased significantly; however “purchase perks” might be added at this time on bigger units or in a slower market.
STAGE 5 – PRE-REGISTRATION INVITES
If you register on a developer’s website, you will get an email invitation and general information about the project. You do not necessarily need an agent to purchase a unit, but you are always better off to have an experienced realtor representing your best interest with the builder, helping you with the legal review, as well as assisting you throughout the process.
STAGE 6 – PUBLIC OPENING
The final stage of a condo launch is the public opening. By this time there have already been five previous purchase groups. It is always better to have a proactive agent helping you to get in line among the first buyers.
A mortgage is not required until final possession. Final possession is typically 3-5 years after the first round of sales for a condominium in Toronto. At the time of the final possession, the deposit money that you have already paid will be applied to the purchase price.
However, some builders will require a mortgage commitment letter at the time of purchase or right after/during the 10 days cooling-off period. Call us today to understand more about the process.
Below are the typical steps involved in purchasing a suite at the beginning of a new condo launch. Platinum Agents tend to offer front of line access to the best projects and suites.
Below are the typical steps involved in purchasing a suite at the beginning of a new condo launch. Platinum Agents tend to offer skip-the-line access to the best projects and units.
- Selecting the Project
Perhaps one of the most important aspects is selecting the right project. This will involve consultations with your chosen Real Estate Professional regarding suitable location and a trusted builder.
- Selecting the Suite
Once you have chosen the project, narrow down your selection for the best suite. This will include a floor plan analysis, the view, a range of floor choices, suite price, and deciding how the suite will fit in your budget.
- Submitting a Suite Reservation Worksheet
Once you decide which suite you are interested in purchasing, simply complete a suite reservation worksheet and return it to us, your Platinum Agents. The worksheet will outline the suite you are interested in and what floors you would like to purchase that particular floorplan on. It will also include your contact information, your occupation, your email address and your phone number. In addition, your Platinum Agent will ask for a copy of your ID to confirm that the information on the worksheet is accurate. It is advisable to submit a worksheet together with a bank draft to the builder’s lawyer firm to increase the chances of allocation.
- Confirmation of Suite Allocation
Your Platinum Agent will confirm the suite that has been allocated to you. Once you confirm that you wish to purchase the suite offered by the builder, you will make an appointment to sign the agreement. The suite will be held for you until that time, but normally the builder would want to know within the same day if you are taking the unit. .
- Signing the Agreement
If the information that you provided on your worksheet is accurate, then the paperwork for the agreement can be prepared before you arrive. You will typically sign multiple copies of the same agreement so that all parties have a copy. It is important that your email address and phone numbers are correct and a valid copy of photo ID is presented.
- 10 Days Cooling-Off Period
Once you sign the agreement, you will have 10 calendar days of a “Cooling off Period.” The developer is required to give you this time period to review your agreement and the suite choice. We recommend that you do the following during this period:
Have a Lawyer review your agreement. A lawyer will read through the agreement and highlight any issues that may be of concern.
Get pre-approved by a mortgage broker. If there are any problems within the 10 days, you will be able to cancel the agreement with no penalty.
- Deal goes firm & Deposits get Cashed
On the 11th day, the deal will automatically go firm and the first deposit cheque will be cashed.
It is advisable to have a lawyer at the very beginning of the pre-construction condo purchase. A lawyer will help you to review the Agreement of Purchase and Sale (APS), as well as the schedules and clauses that you will need to review and sign throughout the process. More often than not a builder will require the contact information of your lawyer at the time of purchase.
The reason why the builder is requesting SIN is to confirm your citizenship. A copy of photo ID and a bill showing your address might be enough in some cases.
Additionally though, when you are purchasing a pre-construction condominium you will need to put money down as a deposit. This deposit will sit in an Interest Bearing Trust Account and can be held for up to five years. The developer can collect the interest earned on the deposits; however, in order to do so, the developer must issue the necessary tax documentation, which will require your SIN number. It is important to note that this sensitive information is always handled with the utmost care and will only be shared with the developer if needed.