Posted on: 24-10-04 19:50:45
Hello CDs,
Is it possible that I can book a Condo/Townhouse/House while its being constructed. Normally during construction time the cost is lower. Once they start giving the possetion the costs goes up. When the cost goes up I can sell the Condo/Townhouse/House. I have a few queries about this if anyone of you guys can address.
1) Do i need to take a mortgage to book a Condo/Townhouse/House , lets say that an initial down payment is 10,000 dollars which i can pay from my pocket?
2) Does the construction companies make a bond with the buyer that if i book the condo//Townhouse/House then i have to stay in it and cannot sell till they start giving posession?
3) How much tax do i have to pay if lets say the above is possible and i booked a 1 room condo with a value of $ 1,50,000.00 by paying $10000 down payment and then after 1 year when the construction is about to get over and all the condos are booked, i sell to someone who is interested to buy it for $1,60,000.
Thanks in advance for your help.
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Indian IT Guys Rules........
This could be a sound investment idea and is being practised quiet often by real estate investors in Canada. However there are a few red flags that one must bear in mind. E.g. the time period in which one will sell, builder's rules in regard to re-sale, selling costs and real estate market growth.
1. Yes, you would need a mortgage loan approval and the builder may want to see a letter of approval from bank.
2. Yes, the builder most likely will make such a contract and you may only be allowed to sell once the condo has been registered in your name and the title has been transferred. Sometimes it can take more than 6 months for the above process for newly built high rise condo building.
3. What taxes are you talking about? One does not pay capital gain tax on re-sale of principal residence, however if this property is not your principal residence and is an investment property then you should speak to your financial advisor.
Other costs involved in buying a condo/ new builder home can be some of the following:
land transfer taxes, legal fees, condo reserve fund build up, condo damage deposit, water and hydo meter, paving holdbacks, landscaping/trees, ONHWP fees, school levies, cost of upgrades and closing costs.
You may like to see a professional Realtor followed with a lawyer and mortgage consultant before you venture out to invest in a property.
Best wishes,
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Amit Kalia, Broker, REALTOR®
RE/MAX Real Estate Centre., Brokerage
independently owned & operated
100 City Centre Dr, Unit 1-702
Mississauga, ON L5B 2C9
Phone No.: 905-339-5111
Website: https://www.realestate-ontario.com/
Condo Blog: https://condopundit.com/blog/
Quote:
Orginally posted by amit kalia
1. Yes, you would need a mortgage loan approval and the builder may want to see a letter of approval from bank.
Is that true? I had once booked a house in Mississuaga - Eglinton & Hurantario, (and once reserved it for 3 days in Tribute communities at Gamble in Richmond Hill) but I was not asked for the mortgage approval.
Chandresh
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Chandresh
Advice is free – lessons I charge for!!
I agree with Chandresh. You don't need any mortgage approvals to book a house.. I am not sure about Condos.
In my case, the builder had put a condition that I will stay in the house for atleast one year after I have purchased the house.
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Your attitude, not your aptitude, will determine your altitude.
Thank Everyone for your replies.
Chandresh, if you dont mind can i ask you whether you booked the house for investment purpose? and if so did the construction company make any contract with you? for eg you have to live in it for atleast 1 year?
Also, anyone of you guys know about such kind of investment opportunities in toronto... I am looking at this new condos to be build at ellesmere and mccowan.. its know as Skyscape. will let you guys know more about this skyscape project once i know more.
Thanks,
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Indian IT Guys Rules........
Quote:
Orginally posted by chandresh
Quote:
Orginally posted by amit kalia
1. Yes, you would need a mortgage loan approval and the builder may want to see a letter of approval from bank.
Is that true? I had once booked a house in Mississuaga - Eglinton & Hurantario, (and once reserved it for 3 days in Tribute communities at Gamble in Richmond Hill) but I was not asked for the mortgage approval.
Chandresh
Chandresh ji,
You are right and Amit is also right.
I think it depends on the builder and the cost of the (new ) house/condo you are going to buy. I know 2 cases, when a friend of mine is buying a new home in Thornhill for around $575,000 the builder did ask for a mortgage approval and another client of mine was to buy a condo at the waterfront and the builder there also asked her to confirm if she would qualify and get the mortgage. However, not all builders may ask for this as 5 years ago when I booked 2 houses with separate builders for my self, I paid the $10,000 deposit and the builder did not even mention about the mortgage approval.
Moreover, Seth ji aapki personality dekh kar kaun builder aapse mortgage approval laane ya fir dikhaane ki jurrat kar sakta hai.
Regards,
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Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
Quote:
Orginally posted by Pramod Chopra
Chandresh ji,
You are right and Amit is also right.
Moreover, Seth ji aapke personality dekh kar kaun builder aapse mortgage approval laane you dikhaane ki jurrat kar sakta hai.
Regards,
Ab to bhiya do raste rah gaye hain - ya to treadmill, gym, jogging kar ke seth ji se hero ban jaoon yah phir such main hi gaddhi laga kar seth ban jaoon. Dono main hi badi takleef hai Pramod Bhai!
Chandresh
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Chandresh
Advice is free – lessons I charge for!!
