There's nothing like moving into a brand-spanking new home, be it a single-family house or a condominium apartment, townhouse or villa. Clean and modern, its has everything you ordered and in exactly the colors you chose for yourself. 'Mighty nice.
Then again, you may not be able to afford new construction. Perhaps no housing of the style you require is being built in the neighbourhood you need or choose to live in. Or perhaps you simply can't determine which is the better value for future resale. Let's examine the considerations in this choice.
*New construction carries a 4.48% net GST cost after the builder gets the tax input rebate. Some developers roll the GST into the advertised price, while some list it separately. For uniform comparison, you should ensure all your prices include the GST. For a price-per-square-foot comparison among projects, and to pre-owned condos, divide asking price (with GST in) by the square footage to arrive at the dollar cost per square foot.
* Pre-built purchase can save you money, because builders sometimes discount prices to those initial buyers who lay down some cash, must wait for occupancy, and help the builder show the construction lender that there is market demand. Yet do you really want to wait 12 or 18 or even 24 months to move in? As well, a minority of these projects never proceed, which gets you your deposit back, but that's about all. In some projects, marketing is aimed at investor owners, not future resident-owners, so keep in mind you may end up living in a largely rental building.
* A pre-built purchase can yield a tidy profit for an investor in a popular project who sells at completion when demand is high and the developer has largely sold out of homes. But in cases where units remain available, or when there are further phases being built, resale buyers may not be interested in a near-new unit when they can get an absolutely brand-new one next door for the same price.
* An alternative to brand-new or pre-owned condominiums is a "conversion", in which an older rental building is converted to condominium ownership, and major renovations are done to the building. These are more common in older neighborhoods than in newer districts. These can also give you the sheen of new interiors, yet the price discount-and some of the practical realities-of an older building. Note that GST is usually NOT chargeable on conversion projects.
* If you want guidance through the labyrinth of options, let a condominium-qualified Real Estate Agent be your guide. As a buyer, it costs you nothing to employ a professional, as his/her fee is included in the sale price in almost every case. Some Realtors will also perform or pay for a condominium documents analysis before you finally buy your new condo home-regardless of whether it is brand-new, or pre-owned.
Calgary Condominium Directory
