Exercise caution when considering new-build real estate

As population densities increase in cities across the country, more potential buyers are looking at the many condominiums available for purchase. Condos offer many advantages over traditional real estate, including minimal maintenance, and downtown buildings provide desirable access to urban amenities and places of employment. For many Alberta buyers, the question is whether to buy into a new or pending project, or go for a used unit.

One real estate expert cautions anyone looking at a new project to be wary. Many people buy into a development before the ground is even broken, when it is difficult to foresee the future of the building. A browse through the headlines can sometimes turn up a lawsuit in progress against a developer, such as the $3 million class action suit going on in Ottawa right now. Nevertheless, some people still prefer to live somewhere brand new, and for them, this expert offers a few tips.

First and foremost, buyers are reminded that the sales office representatives are salespeople. The developer pays them, and they represent the sellers’ interests not the buyer’s. Bringing along a real estate agent might be a good idea.

If one does buy, there is generally a chance to back out, if necessary or desired. Several provinces, including Alberta, allow a buyer a 10-day “cooling off” period, during which he or she may reconsider their purchase. During this period, the buyer can legally cancel the deal without any penalty.

The final piece of advice is to work with a lawyer who deals with real estate. A skilled lawyer can review the contract and bring to the developer’s attention any issues that need to be taken care of before allowing the deal to go through. The experience of a lawyer may protect a buyer from otherwise unseen pitfalls.

Source: CBC News – Ottawa, “‘Never buy new’: Real estate expert warns of pitfalls of buying unbuilt condos“, March 31, 2017

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