The Importance of Using a Real Estate Agent When Buying a Pre-Build
Originally posted May 2021 by Justin Kerby here.
It’s always a good idea to use a real estate professional when buying or selling property, and there’s no exception when it comes to purchasing a pre-build or pre-construction property. Pre-builds are properties that are just that - pre-built. They are units brought to market by a developer before they’re built. If purchasing a pre-build fits your investment style, and you’re comfortable with waiting a year or two to move into a brand new home, there are many benefits that come with this kind of purchase. Just be sure to use a real estate agent to take full advantage.
Here are a few reasons why it’s important to use a real estate agent when buying a pre-build.
Experience can save you time and money
Using a trusted real estate agent that has experience purchasing pre-build properties is critical. Their expertise will calm your nerves and give you the confidence you need to make the right decision. The process of buying a pre-build is often less straightforward for first-time buyers than the more familiar resale process, and having a real estate agent guide you through the ins and outs is beneficial. Sit down with your agent and go through the questions and concerns you have. They’ll be happy to help you understand the process from start to finish.
When interviewing real estate agents, be sure to ask about their experience level with pre-build condos. Ask for past examples, developers they’ve worked with, and client testimonials to be sure you’re working with an agent who can best represent your interests.
Agents have a wide range of knowledge on the market
Buying a pre-build requires just as much research as purchasing a resale property, and your real estate agent has a wide range of knowledge that you can use to your advantage. From recent sales in the neighbourhood to new developments coming into the surrounding area, there is plenty of helpful neighbourhood information that a real estate agent can provide to help you select the right pre-build. Remember that the neighbourhood you choose will likely look a little bit different when you move in than it does today, so watch for incoming businesses, traffic changes, and transportation improvements to get the whole picture.
Take the stress out of negotiating
Real estate agents negotiate for a living and know what developers can and can’t offer you when it comes to your potential unit. While a standard resale property certainly has plenty of negotiations involved, pre-builds are a bit different. Developers will often prefer to work with real estate agents for this exact reason - they know that agents will educate and prepare their clients and keep them informed on pre-build expectations. We’ll discuss upgrades next, but to start, let’s talk about special requests.
You can negotiate plenty of changes into your purchase, and a real estate agent will help you communicate your needs. Charging stations for electric vehicles, small layout changes, and finishings can all be negotiated into your presale contract. Don’t assume that pre-builds are a one-size-fits-all solution. Vocalize your wish list to your agent and let them negotiate and arrange the details with the developer on your behalf.
Going through upgrade options
Pre-builds often come with a long list of potential upgrades for buyers. Having an agent who can go through the possible upgrades and explain the costs and benefits of each line item can help you build your dream home while also staying on budget. From appliances to flooring options, there are many decisions to be made and having an expert opinion will help you in your decision-making process. Don’t be afraid to ask your agent for advice.
Your real estate agent knows and understands what’s to be expected in a contract, what to watch out for, and what you should be aware of before signing. Every presale contract is different, including terms and conditions, deposits, and payment schedules. These contracts are usually drafted by independent legal counsel paid for by the developer, so it’s reasonable to conclude that they’re aimed at protecting the developers. For this reason alone, a buyer’s agent is crucial. A typical contract will have you make several payments throughout the time period between writing an accepted offer and move-in day. You can see an example payment schedule in this article about how to buy a presale condo.
Take the stress out of project updates
Pre-builds take time to come to completion, and staying on top of developments and updates is much less stressful when you work with an agent. Your agent will keep you informed of your upcoming deposit schedule, delays or expedited developments, and any potential decisions that may need to be made along the way.
Assigning a unit before completion
Should you need to sell before your unit is completed, or should that be part of your investment strategy, a real estate agent can help you assign your unit (sell your property). Working with a real estate agent who is well connected with buyers and investors is always a good idea, as they can leverage their network to assign your unit - should you wish to go that route.
Bonus: the seller pays the commission
Since the seller pays the buyer’s agent’s commission, the fees earned by your agent are paid by the developer. A buyer’s agent won’t cost you a penny, so be sure you take advantage of the points listed above and work with an agent when you’re looking for a pre-build.
Don’t underestimate the importance of working with an agent that understands the pre-build market and process. The items listed above are just a few of the many ways an experienced real estate agent can help make the buying process easier and more profitable. You’ll be glad you’re working with an agent when you begin searching, negotiating, and reviewing contracts for pre-build condos.
Originally posted May 2021 by Justin Kerby here.
Mortgage Agent in Ontario, Canada.
Dominion Lending Centres
416.432.8836 | www.dougpaterson.ca