In this 2-part series real estate litigation lawyer, Arsen Krekovic shares insights on both the advantages and the risks of pre-sales in Vancouver’s bustling real estate market. The opportunities attached to properties that are available for purchase before they are even constructed offer a myriad of benefits that can be enticing for those seeking to secure their dream home or make a savvy investment.
Let’s look in detail at some of the advantages that come with pre-sale real estate purchases in Vancouver
(See part 2 to learn of the risks and remedies an experienced real estate litigation foresees in pre-sales)
- Pre-sales in British Columbia often carry Extensive Warranty Protection. In British Columbia, pre-sale condominiums are governed by the Real Estate Development and Marketing Act (REDMA), which mandates warranty protection for buyers. These warranties typically span 2, 5, or even 10 years, providing peace of mind to new owners upon moving in. Learn more about REDMA in this Hoogbruin & Co post.
- Unlike traditional real estate purchases, where mortgage payments start immediately, pre-sale buyers have the advantage of Deferred Mortgage Payments until the completion of the building. This presents an opportunity for buyers to potentially save for the balance of the down payment while enjoying the appreciation of their investment.
- Historically, Vancouver’s real estate market has shown consistent growth in property prices over time. Pre-sales carry the Potential for Price Appreciation. Buyers have the advantage of locking in today’s prices for a property that will likely appreciate by the time it is move-in ready. This can result in significant equity gains for buyers, even before they take possession of their new home.
- A Seven-Day Rescission Period is another key benefit afforded to pre-sale buyers. The seven-day rescission period is mandated by the Real Estate Marketing Act. During this period, buyers have the chance to review the disclosure statement and ensure the purchase aligns with their individual needs before committing to the contract. This provides an added layer of protection and allows buyers to make an informed decision.
- For investors, pre-sale purchases offer an attractive Investment Opportunity. Buyers can capitalize on Vancouver’s dynamic real estate market. By securing properties at pre-construction prices and benefiting from price appreciation over time, investors can potentially realize substantial returns on their investment.
At any time in this extended purchasing cycle, market or construction conditions may change and any number of factors may affect the buyer or builder’s expectations or abilities to deliver on contractual promises. Consult a real estate litigation expert, experienced in dispute resolution or court process, if need be, to resolve your situation.
More pre-sale purchase advantages buyers of real estate properties in Vancouver may find favourable
- Pre-sale homes often come with warranty protection, as mentioned earlier, which can mitigate the cost of repairs or maintenance for new owners upon moving in. Minimal Cost upon Move-In can translate to minimal out-of-pocket expenses and a hassle-free transition into the new property.
- Customization Options! In many pre-sale developments, buyers can customize certain aspects of their future home, such as finishes, fixtures, and layout preferences. This level of customization allows buyers to tailor their living space to suit their unique tastes and preferences.
An experienced real estate litigator will agree that pre-sale real estate purchases in Vancouver offer many advantages. They range from warranty protection and deferred mortgage payments to the potential for price appreciation and investment opportunities. However, buyers must conduct thorough due diligence and seek professional guidance to navigate the complexities of pre-sale contracts and mitigate potential risks.
Stay tuned for Part 2, where we’ll explore the pitfalls and solutions associated with pre-sale purchases in Vancouver from the point of view of Arsen Krekovic with Hoogbruin & Co.
Questions in the meantime about a contract for pre-sale that are of concern? Reach out here:
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info@hoogbruin.com
1166 Alberni Street Vancouver
604.373.9855