When it comes to investing in the real estate market in Toronto, prospective buyers often find themselves debating whether new development condos or resale condos are the smarter choice. While both options come with their own set of advantages and drawbacks, this blog will dive into why new development condos may offer a more rewarding investment opportunity compared to resale condos.
New Development Condos
Lowest Possible Price: One of the most appealing aspects of pre-construction condos is the ability to secure the best possible price. Builders and developers are looking to sell units to fund construction, so you get amazing value. Buyers also often have the opportunity to negotiate favourable deals directly with the developer, resulting in a lower purchase price compared to resale properties. Plus, you secure a price before the condo is built and ready to move in – by which time it has most likely appreciated in value quite considerably.
Flexibility in Down Payment: New development condos provide buyers with the advantage of spreading out the down payment over an extended period, usually across the first year. This longer timeframe to make your payment allows for better financial planning and flexibility.
Personalized Home: Unlike resale condos, new development condos in Toronto allow you to personalize your home from the very beginning. From choosing the layout to selecting the features, finishes, and other elements, you can tailor your condo to your exact preferences and requirements.
Top-Notch Amenities: New development condos often come with an array of luxurious amenities such as fitness centres, swimming pools, lounges, terraces, daycare facilities, and ground-level retail spaces. These amenities not only enhance your quality of life but also make the overall living experience more convenient and enjoyable. They also help to secure and increase your home’s resale value.
Better Investment Potential: As pre-construction condos are brand new and no one has lived in them, plus since they have top-notch features, finishes, and amenities, they have the best potential to appreciate in value over time. This aspect makes them an appealing choice for investors, as they stand a higher chance of gaining value when it comes time to sell.
Consideration of Long-Term Goals: Investing in a new development condo requires careful consideration of long-term goals. Because the wait times during the construction phase can be lengthy, you need to contemplate factors such as potential life changes, including marriage, starting a family, and needing more space, as well as whether you will still want to live in that area in the future.
Prime Location: Pre-construction condos in Toronto are usually located in popular neighbourhoods. These areas have everything you need: easy access to transportation, shops, entertainment, and all the modern conveniences. Living in these prime locations doesn’t just improve your quality of life, it also adds value and desirability to the property.
Smart Technology and Sustainability: Pre-construction condos often use smart technology and sustainable features that make life easier and more convenient but that also save you money on energy costs. Plus, they contribute to the overall long-term value of the property.
Immediate Availability: A significant advantage of resale condos is their immediate availability. Buyers can occupy the property right away, making them a suitable choice for those who need a place to live or want to generate rental income immediately. Some new development condos may also be available for immediate move-in, however – depending on the stage of construction at which you make your purchase.
Potential Maintenance and Renovation Costs: Unlike pre-construction condos, resale properties may require costly repairs, renovations, or modernization. Buyers need to take into account the potential expenses associated with making the property suitable for their needs.
Bidding Wars: Due to the scarcity of available properties in Toronto, the resale condo market often fosters bidding wars. Buyers may find themselves competing with others and having to pay above the listed price to secure the desired property. With new development condos, there are no bidding wars and the prices advertised are guaranteed.
Potential for Limited Appreciation: Resale condos may not appreciate in value as much as newer or less-used units. Buyers often gravitate toward newer constructions, which can decrease demand for resale condos in the future.
In conclusion, while both new development and resale condos have their own merits, new development condos hold unique advantages. These include the potential to secure the best price, flexibility in down payment, the ability to personalize the home, prime locations, enticing amenities, and a higher likelihood of future appreciation. However, buyers must carefully consider their long-term goals and commitments before investing in pre-construction condos. While resale condos offer immediate availability, buyers need to factor in potential maintenance costs, bidding wars, and the potential for limited future appreciation. Ultimately, the choice between new development and resale condos rests on your individual preferences, investment goals, and financial capabilities.