Differences Between a Resale Purchase and a Pre-Construction Purchase
By All Access Homes
January 12, 2024
If you’re here, there’s a good chance you’re thinking about investing in a preconstruction project. Maybe you’re tired of rising rent or simply want the freedom to personalize your living space without asking the landlord’s permission. Or perhaps you’re wary of home maintenance and drawn to condos because they allow you to own property without feeling like it owns you.
These are only a few reasons we love home ownership. But how do you choose between a resale and pre-construction purchase?
While there is no exact right answer, this article will help you make an informed decision.
Resale & Pre-Construction: The Differences
Before we dive into the advantages and limitations of both, we’ll give you a quick overview of their primary differences.
Because pre-construction projects exist only in a blueprint, you’ll be the first owner to occupy it once it’s built. Buyers find this appealing for a few reasons. Not only is your home brand new and often customized to your specifications, but you’re also purchasing it at the lowest price point. Because of this, you can expect almost immediate equity and future appreciation.
**Conversely, buyers occupy resale properties long after the original owner made the highest appreciation on their investment. Furthermore, when you buy resale, the deal requires an inspection, will be handled by a realtor, and, in this economic climate, may subject you to negotiations and possibly even bidding competitions with other buyers. **
Pre-Construction: The Advantages
Buying pre-construction offers numerous advantages, including:
Greater customization: As the original owner, you can customize some of the home's design features and amenities—things like cabinets, appliances, flooring, and more.
Deposit structure: Unlike buying resale, where you’ll have to produce a sizeable down payment at closing, a pre-construction purchase uses a unique deposit structure. This structure gives you more time to save money.
Minimal maintenance: Pre-construction homes are brand new, which means they come with modern features, are energy efficient, and will not require immediate repairs or remodeling. They are covered by the builders’ new home warranty and administered by Tarion.
Pre-Construction Homes: The Limitations
The primary limitation of buying pre-construction is the wait.
Flexible timelines: Your home may take several months or years to complete; there’s also a chance that the project may fall through so we suggest working with a Platinum Agent at All Access.
Our agents specialize in pre-construction, which means we know the developers to work with and those to avoid. In short, we reduce risk while giving you exclusive access to on-the-horizon developments and the first pick of those that will soon break ground.
Design variations: Another limitation of pre-construction is that you buy based on a floor plan. In other words, layouts and measurements are subject to change. Again, that’s why we suggest working with an experienced pre-construction agent. We work with a vetted group of developers who see projects through and do their best to ensure the condo is built to your specifications.
Resale Home Purchase: The Benefits
Pre-construction homes offer many benefits. Ultimately, resale homes can be a better fit for some buyers. Here’s why:
Immediate occupancy: If you need to move quickly, resale allows you to occupy your home immediately after you close the deal.
Certainty: When you buy resale, what you see is essentially what you get. You’ll know the layout, amenities, and design features because you can physically walk through the space.
No delays: Buying resale also removes more uncertainties from the picture. Since your home has already been built, there’s no chance that construction will be delayed or fall through entirely.
Negotiation power: When you buy resale, you can negotiate. Pre-construction prices are pre-determined.
Resale: The Limitations
Regarding the resale of homes, the list of limitations is long, but we’ll highlight a few of the big ones.
Limited ability to customize: Resale homes are generally sold as-is, so you may need to invest in renovation projects in addition to the purchase price.
Older infrastructure: Resale homes may have older HVAC systems, appliances, roofs, windows, insulation, electrical, and more. As a result, you should anticipate more upkeep, repair, and replacement costs.
Why Settle for Ordinary When You Can Experience Extraordinary Living?
All Access Homes is your go-to for pre-construction projects in the Greater Toronto area. As platinum agents, we have key connections in the industry, ensuring our clients get early access to projects with exclusive incentives. If you're after sought-after pre-construction opportunities, contact us today!