If you’re a first-time buyer in Toronto you need the most up to date information when it comes to buying a home in this city. We have outlined each of the different steps involved whether you are considering your first home to be a house, condo or maybe a pre-construction condo in Toronto.
Buying Your First House
How Much Home Can You Afford?
Buying a home will most likely be the biggest investment you will ever make. Meet with a mortgage broker to establish a budget and determine what mortgage option will work best for you. We can recommend a lender to work with if you aren’t already connected with one.
Your Real Estate Needs & Wants
The type of home you invest in should be a reflection of your lifestyle. Consider your plans for the future, your ideal commute, how you spend your free time, and what would fit your budget.
Find The Right Toronto Neighbourhood
Where you buy your home can impact the purchase price, your quality of life, and the home’s resale value. Online research when moving to Toronto only goes so far when you are trying to learn more about a neighbourhood. If possible, spend some time in your new community before you move in. Take a walk to the nearest TTC stop, your children’s school, corner stores, and amenities to get your bearings in the area. See what the city’s top neighbourhoods have to offer by learning more about their culture, residents, history, and more in our dedicated Toronto neighbourhood profiles.
Curb Appeal Shouldn’t Matter
As a first-time buyer, it’s easy to get caught up in the aesthetics of a dream house. Modern decor and trendy paint colours may be attractive, but you should keep your focus on the more permanent features of a home such as location, age, size, and overall condition.
Closing & Keys
When we’ve found the right home, we will put together the offer and ask that you have the details looked over by a legal representative. If one is required, we have someone in office who can be a part of the entire closing process. We will keep you informed every step of the way, even until the late hours of the night in order to secure the home you want.
Buying Your First Condo
Get Your Mortgage Pre-Approval
Like buying a home above, we can’t stress enough how important it is to get pre-approved and this should always be your first step in buying any home or condo. This will help narrow in on the right condo without wasting time on units that are out of your budget.
Pros and Cons of Living in Condo
Before choosing a building, it is always a good idea to consider some of the pros and cons of living in a condo. A condo building is essentially a community within itself, with general meetings, a board of directors, and monthly fees. The rules and bylaws of a condominium building will vary but can cover subjects such as pets, parking, noise, amenity use, alteration of your unit, and maximum occupancy. It’s important to understand that as a condo owner, you might not have the same freedom with your home as you would with a detached house. Together, we can review the building’s rules and bylaws before you buy to ensure they don’t conflict with your needs and wants.
Your Condo Wishlist
Condominiums can check off needs and wants you might not have even known you had, from 24-hour security to a south-facing balcony. Pools, gyms, rooftop terraces, storage lockers, location, and nearby amenities should all be factored into your list of must-haves and deal breakers. Grab a pen and paper (or iPad) and take note of what condo amenities or features will be important for your lifestyle.
Consider Resale Condos – They Aren’t Bad
Seeing both resale and new units will provide you with a greater sense of where your money can take you. While a new build gives you the chance to customize your unit before it’s built, older condominiums may have larger units, lower deposits, and shorter wait times to move in.
Additional Condo Fees You May Encounter
Like with any home ownership there are additional condo fees which may affect your budgeting. In addition to the purchase price, taxes, and closing costs, you will be responsible for the monthly or recurring costs of your condo. Unit insurance, monthly occupancy fees, amenity fees, mortgage payments, utility expenses, and maintenance costs should all be factored into your budget. If you haven’t already, you should also set aside funds for unexpected costs.
Why Not Consider Buying Pre-Construction?
Why Buy Pre-Construction as a First Time Buyer?
Before jumping into buying a home or condo, consider if buying a pre-construction condo could be an option for you. Pre-construction properties are ideal for first-time buyers who are looking to have a strong input in the design and look of their home without doing renovations themselves. If you are looking into a pre-construction condo, consider that you will be waiting anywhere from a few months to a couple of years to move in and take ownership. On the plus side, a longer closing period means you will have more time to save for your down payment.
Finding the Right Pre-Construction Condo in Toronto
If you have found a promising condo, do some research into the developer to ensure they are reputable. If you aren’t familiar with the neighbourhood, take time during the day and evening to get a feel for the community and residents. Ask about any future developments that may be planned for the surrounding area, as that can impact everything from your view to the community itself.
TRB is able to provide early VIP access to pre-construction condos which allows for lower deposit structures, access to exclusive units and hands-on site visits. Our team specializes in guiding buyers through this process, using our market knowledge and financial background to ensure you feel confident and happy with this exciting real estate investment.
Making Your Down Payment
You will need to make a 20% down payment on your pre-construction condo, which will be broken down into 5% installments over time. You will make your first installment within 10 or 15 days of signing the agreement, then at the 30, 90, and 180-day marks. These dates may change depending on the builder.
Pre-Construction Cooling Off Period
Once you have put a deposit down on your unit, you will have a 10-day cooling off period to think about your decision and make sure your paperwork and finances are in order.
The Waiting Game
Delays are common with condominiums, so be sure to plan accordingly if you are currently renting or planning to sell. Once your unit is ready, there will be an ‘interim occupancy’ period where you will be able to move in, but you will not own the condo yet. During this time, you will be paying the builder an amount that roughly equals your mortgage amount, plus condo fees and taxes. This is not a mortgage payment as you won’t officially own the condo until it is registered.
Pre-Construction Closing and Fees
In addition to your deposit and down payment, you will be paying two months of condos fees towards the condo’s reserve fund. You will also have to pay HST upon closing but may be eligible for a rebate if you plan on living in the unit yourself. Additional builder adjustment costs can include utility hookups, development costs, and HST on appliances.
Work With an Experienced Team of Realtors
We believe that buying your first home should be a strategic financial investment – it’s simple as long as you are armed with the right knowledge. The piece of advice we can give you is to ensure that you work with the right real estate team, that will deliver on your expectations.
We provide one-on-one service, anytime and anywhere. When you are buying a house, condo or pre-construction with us, we will make ourselves available to you as often as possible. We like to develop a relationship with our clients, building a life-long connection that will help you succeed in all of your future real estate transactions.