This is one of the questions I get ALL the time: During the pre-construction sale cycle, when is the best (and worst) time to buy?

First things first – there is no one right answer here.  There are hundreds of developers in Toronto and a number of sales teams that handle the sales process differently from each other.  As a result there is no single right answer.  However, there are definitely patterns and below I have listed the best times to buy based on experience.

a) The VIP/Platinum/Super VIP/VVIP Launch

The VIP launch is typically the best time to buy a pre-construction condominium.  Most of the time (but not all of the time, which means it is very important to analyze the prices offered to determine if they will likely come down later) you will get the best price per square foot and investor perks (such as a lower assignment fee and capped development levies).

The major disadvantage (if you want to call it that) is that you will unlikely get any additional perks you may get later in the sales cycle (free locker, free maintenance for a year, free parking etc.) but you do get the benefit of paying less for the unit.

In addition, VIP buyers are typically paying 15%-20% deposit, whereas later in the life cycle you may be able to get 5%-10% down payment depending on how well the condo development has sold and how much inventory they are dealing with.

b) The Public Launch

Based on my experience, the public launch is typically the worst time to buy a condo development.  The prices may have increased since the VIP launch and there tends to be less incentives than if you were to purchase at a later stage in the sales cycle.  The public launch is typically the “no-mans-land” stuck between the best price and best incentives.

c) The Builder Wants Financing

Most builders are required to pre-sell 75% of their development to get financing so they can start building.  When a development is sitting at around 65%-70% sold there can be some excellent deals such as price discounts (we have seen major developments offer price discounts even LOWER than the VIP pricing), AND lower deposit structure (as low as 10%), AND additional perks such as discounted parking.  These sales are often not advertised by the builder, and many of the builders do not permit us to advertise the special promotion on public forums (we e-mail them out to our newsletter database which you can sign up for here).

The major caveat buying at this stage is that you may have restricted choice of suites and the “best suites” may have already been sold.

d) Coming up to Occupancy

The final chance to purchase in a New Condo Sales-Cycle is when the building is nearing completion and the developer has a few suites remaining.  They typically offer some great incentives such as very low deposit structure and discounted parking.  M5V are having an inventory blowout currently, offering free parking on some of the larger suites and an opportunity to purchase with just 5% deposit.

The prices are typically a lot higher at this stage, however, it is a great chance to purchase if you want something closing sooner rather than later.

Again, this is a typical sales-cycle for pre-construction condos, however, we do understand that there may be differences from building to building.