Who Cares if the Ground Hog got it right, Spring is STILL Coming. I promise.

Spring is Springing!  Yay!  I just came inside from shooting a video outside and WOW!  It’s nice out!  Yes, I realize that when you get this and read it that it could be cold and rainy, but those cold days are just about over.  Everyone loves Spring, primarily because it means… summer is near! 

For many across this great country though, it’s still COLD, grey, and snowy! One thing is for sure, this winter season is coming to an end.  It does every year without fail. 

Just like the weather seasons come and go, so do the seasons of life.  I just turned 35, my youngest just turned 7 months, and my oldest is adventurous exploring what toddlers do best.  Are you with me when I say that these seasons seem to come and go faster and faster as well as the time? 

Some of life’s seasons will be HOT and others will be COLD, some high and some low.  The lows we want to move by quickly, the highs we want to stay in forever.  But it’s the low points, those tough times, that I have learned the most from.  All of the experiences through these seasons make me who I am.  

So, what does this have to do with you and real estate?  

Spring is a time of action, a heating up of the desire for a new place to call home for many.  Maybe you or someone you know is right now looking or considering it.  That’s great!  We are here to help with that.  Whether it be a list of the 10 best buys matching home buying criteria or delivering top dollar on a home sale along with our written guarantee of the asking price, our award-winning SYSTEM and TEAM are eager to help.  

Unfortunately, there are some that will have a Spring Time they would much rather forget. 

We are on a mission to raise $50,000 for Rozaay Books Sneaker Drive. We do this by donating to them a portion of our income from the homes we sell.  The goal is to empower children and youth for the real world. This is done through a series of free events such as workshops, clinics, panels and many more initiatives that give the next generation access to new world information and help with self-discovery. 

If you or anyone you know is considering selling, give me a call or pass on my number.  Thank you in advance for your referrals! My number is 647-308-9000.

Thank you for reading over this month's Homeward Bound, and thank you for referring anyone you know considering buying or selling to my team. They will be in good hands and a very worthy cause will benefit as well.

Michael Lau

Townsend Team Real Estate


How To Sell a House That Didn’t Sell

If your home has just come off the market and hasn't sold, don't be discouraged. The reason your home did not sell may have nothing to do with your home or the market. In reality, your home may have been one of the more desirable properties for sale.

So Why Didn't Your Home Sell? Last year many of the homes listed for sale never sold at all, and many sellers found that there was a tremendous amount a homeowner needed to be educated on to sell their home for top dollar in the shortest time period.

Don't risk making the wrong choices and losing both time and money on your investment. Before you hire a realtor, know the right questions to ask to save you time and money.

Industry experts have prepared a free special report called "How to Sell a House that Didn't Sell" which educates you on the issues involved.

Q. Where should you begin? 

A. Start by making a commitment to do what it takes to market your house to get it sold. With the right system, the home sale you want is still well within reach. 

Q. Why didn’t your home sell? 

A. Review your previous selling plan and you’ll discover that an expired listing usually reflects a problem in one or more of these four major areas: 

  1. Teamwork
  2. Pricing
  3. Condition of Your Home
  4. Marketing

Why Don’t Some Houses Sell?
Here are 2 out of the 4 Important Points That Will Get Your House Sold! 

1. Teamwork 

Your home is a major financial investment, and your relationship with your Realtor® should be a full partnership where your needs and wishes are heard, and you receive detailed and dependable feedback on the progress of your sale. Your agent has a responsibility to source this feedback from the agents who have shown your home, and to communicate this to you so together you can make the right decisions about what to do next. How well did this occur the last time you had your home up for sale? 

2. Pricing 

Did the price work for or against you? The “right” price depends on market conditions, competition and the condition of your home. Pricing it too high is as dangerous as pricing it too low. If your home doesn’t compare favorably with others in the price range you’ve set, you won’t be taken seriously by prospects or agents. 

You’ll get the facts when you see the statistics! 

So there are 2 out of the 4 reasons to get your home sold! If you'd like to see all 4 of the tactics to get your home sold, you can grab a copy of that report for free by sending me an email to michael@callmikelau.com or call/text me at 647-308-9000.

Thank you for reading this weeks blog.

Michael Lau

P.S. Your Home Sold Guaranteed or I’ll Buy It!*  If you or anyone you know is considering making move in the next few months, give me a call or pass on my number…. 647-308-9000

11 Critical Home Inspection Traps to be Aware of Weeks Before Listing Your Home for Sale

According to industry experts, there are over 33 physical problems that will come under scrutiny during a home inspection when your home is for sale. A new report has been prepared which identifies the eleven most common of these problems, and what you should know about them before you list your home for sale. Whether you own an old home or a brand new one, there are a number of things that can fall short of requirements during a home inspection. If not identified and dealt with, any of these 11 items could cost you dearly in terms of repair. That's why it's critical that you read this report before you list your home. If you wait until the building inspector flags these issues for you, you will almost certainly experience costly delays in the close of your home sale or, worse, turn prospective buyers away altogether. In most cases, you can make a reasonable pre-inspection yourself if you know what you're looking for, and knowing what you're looking for can help you prevent little problems from growing into costly and unmanageable ones.

Here are 4 of the 11 that you should know about right now.

1. Defective Plumbing

Defective plumbing can manifest itself in two different ways: leaking and clogging. A visual inspection can detect leaking, and an inspector will gauge water pressure by turning on all faucets in the highest bathroom and then flushing the toilet.

If you hear the sound of running water, it indicates that the pipes are undersized. If the water appears dirty when first turned on at the faucet, this is a good indication that the pipes are rusting, which can result in severe water quality problems.

2. Damp or Wet Basement

An inspector will check your walls for a powdery white mineral deposit a few inches off the floor and will look to see if you feel secure enough to store things right on your basement floor. A mildew odor is almost impossible to eliminate, and an inspector will certainly be conscious of it.

It could cost you $200-$1,000 to seal a crack in or around your basement foundation depending on severity and location. Adding a sump pump and pit could run you around $750 - $1,000, and complete waterproofing (of an average 3 bedroom home) could amount to $5,000-$15,000. You will have to weigh these figures into the calculation of what price you want to net on your home.

3. Inadequate Wiring & Electrical

Your home should have a minimum of 100 amps service, and this should be clearly marked. The wire should be copper or aluminum. Home inspectors will look at octopus plugs as indicative of inadequate circuits and a potential fire hazard.

4. Poor Heating & Cooling Systems

Insufficient insulation, and an inadequate or a poorly functioning heating system, are the most common causes of poor heating. While an adequately clean furnace, without rust on the heat exchanger, usually has life left in it, an inspector will be asking and check- ing to see if your furnace is over its typical life span of 15-25 yrs. For a forced air gas system, a heat exchanger will come under particular scrutiny since one that is cracked can emit deadly carbon monoxide into the home. These heat exchangers must be replaced if damaged - they cannot be repaired.

So there are 4 out of the 11 in an effort to draw attention to this very important topic. If you'd like to see all 11 of the most common inspection traps I have put together a free report entitled *11 Things you need to know to pass your home inspection" which explains the issues in greater detail. You can grab a copy of that report for free by sending me an email to michael@callmikelau.com or call me at 647-308-9000.

Thank you for reading this weeks blog.

Michael Lau

P.S. Your Home Sold Guaranteed or I’ll Buy It!*  If you or anyone you know is considering making move in the next few months, give me a call or pass on my number…. 647-308-9000

Steps to Buying a Home

Buying a home can be overwhelming. You could be a first time home buyer, investor, moving up to a bigger home, this guide will help you through all the steps.

  1. Get pre-qualified for a mortgage. Talk to mortgage brokers, banks, etc.
  2. Go online and view homes in person.
  3. Make an offer, be ready for negotiations and possibly bidding wars
  4. Know your closing costs


Don’t search blindly. The biggest mistakes i’ve seen is buyers think they know what their budget is when really their purchasing power might be much higher or lower. By doing this as your first step, you can potentially save yourself thousands and hours. Get Pre-Qualified!

Step 1 – Get Pre-Approved for a Mortgage

The first step to buying a house or condo in Toronto or anywhere in the world should be finding out how much your bank is willing to lend you. When you pre-qualify for a mortgage, your lender will look at your income, your debts, your credit history, and your down payment. This mortgage pre-approval is usually valid for 90 to 120 days which includes an interest guarantee. 

One thing to note, a pre-approval is not a guarantee that a lender will lend you a certain amount of money for any home. Lenders want to know that the home they are purchasing with you (by lending you the money) is worth what you paid. Banks generally require an appraisal of a home before they advance the mortgage money.

Getting pre-approved will ensure that you know how much mortgage you can get, which in turn will help you know what price range of homes you should be targeting in your search. It allows you to focus your house-hunting efforts and eliminates the risk and uncertainty of financing once you find your perfect home.

Step 2 – Mortgage Decisions

Mortgages can seem intimidating, especially for first-time buyers. Once you’ve qualified for a mortgage, there are some basic decisions you will have to make before you take possession of your house or condo: Mortgage term, amortization, interest rate and type of mortgage. Your mortgage broker should be able to help you guide you through all the different types of mortgages.

Mortgage Term and Amortization

The mortgage term and amortization period affect the amount of money you can borrow (and thus the price of the home you can buy), and dictate how much your monthly payment will be.

Mortgage term

This is the amount of time a lender will loan you money for – typically from 6 months to 5 years. When the term is up, the remaining amount is payable in full unless you arrange new financing for another term.


The longer the amortization period, the lower your individual payments will be – but this also means you’ll be paying more in interest. Lenders calculate or amortize, the mortgage payments over a much longer time, often as long as 30 years.


Most mortgage payments consist of two parts: principal and interest. Each payment reduces the balance owed on the mortgage by the portion of the payment that is credited to the principal. Over time, the proportion of your payment that reduces the principal balance will increase. The faster you can pay down the remaining balance, the less total interest you’ll pay. There are many ways you can pay down your mortgage faster, from accelerating your payments (e.g. paying biweekly instead of twice a month, for 26 payments per year instead of 24) to making lump sum payments on your mortgage; your lender can help define the right strategy for you.

Interest Rates

The interest rate is one of the biggest contributing factors to how much you end up paying for your home, both on a monthly basis and over the life of your mortgage. Interest is the cost of borrowing money. Interest rates fluctuate with the economy. The interest rate you commit yourself to at the beginning of the term can have a significant effect on the amount you pay each month for your mortgage. There are two basic types of interest rates used in mortgage products: fixed-rate and variable-rate:

Fixed-rate mortgage – Essentially, this means committing to a single interest rate that will not change for the term of your mortgage. This strategy locks in how much of your monthly payment repays the principal vs. going to interest. Fixed-rate mortgages are great in an economy where interest rates are going up, as you never have to risk paying higher interest rates.

Variable-rate mortgage – There are two types of variable-rate mortgages. With the first kind, the amount of your monthly payment fluctuates with the bank’s prime interest rate – if rates go up, your payment increases; if rates go down, your payment decreases.

Step 3 – Choose a Lender

There are many types of lenders and mortgages out there. It’s a good idea to talk to at least three lenders:

  1. Your own bank. They have your bank accounts, credit cards and investments so they should be motivated to give you a good rate.
  2. A mortgage broker. Mortgage brokers work with a lot of different lenders and will go to them on your behalf to find the best mortgage rate and terms. Usually, broker fees are paid by the banks, so it’s a good way to comparative shop without having to do all the leg work yourself.


This is the fun part! Almost everyone I meet now spends time searching for properties online and attending open houses! The dream of yours forever home!

First Things First – Develop your Wish List

There are over 100s of criteria out there when searching for a home. You need to create a list of what you want and what you need. How many bedrooms do you need? Open Concept? Separate Entrance? Location? Almost everyone needs to compromise on something, and it usually comes down to 3 things: size, location, and price. 

What’s most important to you? Would you rather live in a bigger house or closer to downtown? Are you OK spending more money for a renovated house or could you buy a cheaper house and do the renovations yourself? Would you consider living on a busy street to more affordably be in a better neighborhood with access to better schools?

Step 2 – Pick Your Team

This will likely be the biggest purchase you’ll ever make! Don’t worry, you don’t need to do it alone. There are professionals who will be able to help you throughout the process. You will need a lender/mortgage broker who will guide you through your financing options, a lawyer to help with reviewing legal documents, and a real estate agent who will help ease your search process. There are thousands of professionals out there, so ask your friends and family for recommendations, do your research and don’t be afraid to interview multiple people.

Step 3 – The Search

94% of Canadians search for their homes online.

Tips for looking for a home online:

  • Unfortunately, photos are not always a representation of what the home actually is. 
  • Descriptions can be overly exaggerated to sell the property. 
  • Asking prices of the home may not always be what the market value of the home. In a hot market, often homes sell for more than the listing price. 
  • If you’re shopping for a condo, keep in mind that what’s included in the maintenance fees varies from building to building, so it isn’t easy to compare condos. A lower maintenance fee might still mean more monthly costs if it doesn’t include heat and electricity.

Step 4 – House Hunting in Real Life

You can visit homes for sale in real life with your real estate agent or by attending an open house. Keep in mind that not all properties will have open houses, so working with a real estate agent you trust the only way to guarantee that you’ll be able to see the houses or condos you want to see (and on your schedule!).

Tips for looking at homes in real life:

  • Toronto is a big city, and if you’re like most people, you have a few target neighborhoods. Try to focus on one neighborhood at a time.
  • Wear slip-on/slip-off shoes. Seriously. You’ll be taking your shoes off dozens of times, so save yourself the hassle of lace-up shoes. 
  • Don’t just focus on the house or condo, focus on the neighborhood. Drive around the neighborhood. Locate the schools, parks and grocery stores. Take a walk down the street and check out the neighbors. Make a point of going to a cafe, restaurant or pub in the area.
  • Vary the time of day that you house hunt. Everything looks better when the sun is shining, but it’s important to get a feel for the house or condo and the neighbourhood during the day AND at night.
  • Experience the bad with the good. Every neighbourhood has its drawbacks, so make a plan to experience them. Thinking of buying a house near the railroad tracks? Check it out during rush hour when most of the trains are running. 
  • Take notes and photos. It’s surprising how quickly you can forget the first house or condo you saw. 
  • See past the gross. You’ll probably be surprised to find out how some people live, but don’t let someone’s bad decorating styles, outdated tastes and lack of housekeeping get in the way of finding your perfect Toronto house or condo.
  • Don’t fall in love with the seller’s stuff. This happens all the time and that beautifully staged condo won’t look nearly as great with all your IKEA stuff in it. Try to imagine your furniture and style.

How I can help with your search?

  • I will help you match what you want with the greatest opportunity for ROI. Together we’ll examine your needs, wants and must-haves to create a picture of your ideal home or investment property.
  • I will stay on top of new properties in the best Toronto neighbourhoods as they come on and off the market. We’ll send you daily listings of what’s available and monitor what’s happening, as it happens.
  • I will be your house-hunting partner on YOUR schedule. We can take you to see any property that’s for sale and sometimes even ones that aren’t.
  • I can save you time. We can preview properties on your behalf and screen what is or is not for you, saving you time and hassle. I can send you video profiles of what we’re seeing – or better yet, you can follow us streaming live on the web.

Making an Offer

You have found the home you want! The offer process is both exciting and nerve-wracking. We begin by drafting the Agreement of Purchase and Sale. This is a legally binding document which contains everything from the price you are prepared to pay, to the inclusions you want (washer/dryer, big screen TV), to your ideal closing date (the date you take possession), to conditions that need to be met for the deal to go through. Once you’ve submitted your offer, the seller can accept it, reject it or sign back a counter offer. During these back-and-forth negotiations, you may need to compromise on small things, but a good real estate agent will work hard to get you what you want. And if you’re in a bidding war, make sure you know the facts about Bidding Wars and How to Win in Multiple Offers.

Meet Conditions and Provide Deposit

Conditions are requirements within the Agreement of Purchase and Sale that must be met for the deal to go through. These are the most common conditions which you might include: financing condition, lawyer review of the status certificate in a condo, or a home inspection. And of course, you’ll need to submit a deposit–in Toronto, typically around 5% of the purchase price, which is held in trust until close. Once the conditions have been met, the agreement is firm, and now it’s just a matter of waiting for your closing date. 


Once you have a firm deal (both you and the seller have agreed on price and agreement terms, you’ve submitted a deposit, and there are no more conditions to waive), the closing process starts. This will require you to be in close contact with your lender and your lawyer – they’ll need lots of information, and of course, money, from you.

The few days before you take possession are the most critical – you’ll need to sign a lot of paperwork, provide a certified cheque for the balance owing and of course, pick up your keys.

Closing is the point at which the ownership and possession of the property are transferred from the Seller to you. It takes place after all legal and financial obligations have been met. Closing the purchase will be a team effort: in addition to yourself, your lawyer and your lender will all be involved in helping close the deal.

Costs of Buying a Home

Some of the things you can expect to pay are:

  • Down payment (less any money you have already provided as a deposit)
  • Land transfer taxes (If you buy a property in Toronto, you will need to pay a municipal land transfer tax in addition to the land transfer tax in Ontario, click here to calculate)
  • Lender fees, if applicable (appraisal fees, application fees, etc.)
  • Adjustments (the seller may have pre-paid taxes, utilities or other expenses past the closing date which you will need to reimburse during the closing process)
  • Legal fees (plus applicable taxes)

Your lawyer will calculate the final amount owing, and you will need to provide him/her with a certified cheque for the full amount before the property comes into your possession.

How Expensive Is It To Rent?

You're going to be living in someplace anyway, why not fix your payment at a certain amount and do whatever you want to do with it. 



Discover How To Sell Your Home For More!

Discover strategies to sell your home for more today!

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Ontario’s New Rental Housing Policy: A Step in the Right Direction

Ontario Government Announces New Rental Housing Policy

Last Thursday, Doug Ford’s Provincial Conservative Government released its Fall Outlook. In that report, it announces that all new rental units, or those that are currently unoccupied as of November 16, 2018, will be exempt from the rent control rules that were implemented in April of 2017. This announcement comes after the average rental rate in the City of Toronto grew 12.1% since last April. That’s a whopping $2,379 a month!


What does this mean?

Conversely, all existing buildings and tenants will still be covered by the 2017 Rent Control rules under the Landlord and Tenancy Act. As stated by the Government, the intended consequence of rolling back rent control on new rental units is to incentivize investors and builders to create more rental inventory, which the city of Toronto so desperately needs. According to the Government in its press release, “the demand for housing in Ontario has risen rapidly in recent years, driven by strong population growth and low interest rates.” However, the supply of housing has not kept pace. And this only further leads to higher prices and rents. Over the last few years, rent control policies that weaken investment incentive and construction activity play a heavy role in limiting supply growth in purpose-built rental housing.

Shaun Hildebrand, President of Urbanation – a company that tracks the Toronto rental market data – describes the current state of the market, as “rental supply has fallen to a critically low level. Demand has been pouring into the market while rental construction still remains relatively low. Condo projects are taking longer to reach completion, not as many investors are offering their units for rent, and tenants aren’t moving as often.”


Why is this happening?

With immigration continuing to pour into Toronto, we clearly need more supply and according to Hildebrand, “we need to be building at a pace of probably at least 10,000 a year. To get there, we would need to see the level of units under construction triple at least — above 30,000.”

The results of strong immigration into the GTA combined with the stifling effects of rent control have caused near crisis-like conditions in the Toronto housing market. We see the effects of low inventory in our marketplace daily. Recently, we rented out a  one bedroom in downtown Toronto. Given the lower price point ($1,800 per month), we advertised privately on craigslist and Kijji. In 36 hours, we received 300 email inquiries, with close to 100 people at the open house. We also got 31 rental applications and in the end, we rented the unit for $100.00 over asking, without even asking. If this is not evidence of a housing shortage, we’re not sure what is.

But, it’s a step in the right direction.

While the issue of rent control is a political hot topic, most economists around the world agree that over the long-term, rent controls will have a very negative impact on affordability. It stifles investment into the new supply and updates to the existing supply. We happen to wholeheartedly agree. Is this new government policy going to solve Toronto’s rental housing crisis? Probably not. However, it’s a good long-term step, heading in the right direction.

Top 12 Considerations Any Pre-Construction Buyer Should Know

The Pre-Construction Buyer Guide


The downtown Toronto resale condo market has been a real challenge for those looking to purchase a condo. Especially for both end-users and investors alike, this has been the case. Because of low inventory and continual bidding wars, many investors and first-time home buyers are turning to buying pre-construction versus resale. While buying pre-construction is both exciting and lucrative, it’s a far more complex process than buying resale. There are many common pitfalls to avoid. That’s why it’s important to know what to look out for as a pre-construction buyer.

With the Toronto real estate market, there are many things to think about when it comes to pre-construction. From my experience in selling pre-construction development projects on behalf of developers and assisting hundreds of clients through the process of acquiring pre-construction properties, there are a number of need-to-know’s. Before proceeding with a pre-construction condo purchase, here are 12 considerations you should be aware of.


1. Know the Developer

When looking at pre-construction, you are essentially purchasing something that hasn’t been built yet. That’s why you need to do your due diligence and research the developer. There are always risks to consider when buying pre-construction. However, those risks can be mitigated when you choose to buy from a reputable developer – one who has a great track record. Research with these questions in mind:

•How long has the developer been in business?

•What were their past projects?

•Do they have a good reputation in dealing with their purchasers?

•What is the quality of their work?

Simply put, you never want to buy from a developer who’s on their first project or one with a bad reputation.

2. Location, Location, Location

It’s a common saying in real estate, that it’s all about location. Looking at the Toronto real estate market, this is especially true. When purchasing a condo that may not be completed for 3 to 5 years, your ability to see into the future becomes even more magnified. Ask yourself:

•Is the area gentrifying?

•Will there be transit or any large infrastructure projects?

•What is the access to parks, coffee shops, and restaurants like?

•Will this area or submarket outperform the overall Toronto market?

These are all important investment and lifestyle considerations to think about as a pre-construction buyer.

3. The Cost of Amenities

It’s important to consider, “what are the amenities and the costs associated”? In reality, most residents don’t really use the amenities available to them. And, over time, amenities can cause maintenance fees to rise, which in turn increase monthly carrying costs. With this, these fees can put downward pressure on appreciation, especially as buildings begin to age. Although a state of the art gym and infinity pool look great on a sales brochure, the question any investor should be asking is, “how will this impact my ROI”? Similarly, as the end user, you should be asking, “will I actually use these these amenities more than once a year to make the added costs worth it”? While every pro-forma and individual will look at this differently, it is nonetheless, important to consider.

4. Get a Good Look at the Floor Plan

It’s paramount that you choose a good floor plan. Your choice of floor plan can be a make or break decision for your investment or future home. Especially as a pre-construction buyer, purchasing from a floor plan can be difficult. So, think about some of these considerations:

•The best condos are the ones that have the most natural light.

•Wide and shallow floor plans are superior to long and narrow ones, which often tend to be darker.

•Does the master bedroom have a door?

•Are the ceilings stipple?

•Is a kitchen island or option to have one available?

•Will you be able to hookup a gas BBQ?

Envision what this will look like from an investment perspective – whether that’s for the eventual tenant or buyer, or as a future home.

5. The Deposit

When acquiring a pre-construction property, the deposit (typically 20%) is spread out over time. While it can vary, it’s usually broken down into payments of 5% across a timeline like so:

•30 days

•90 days

•365 days

•And then, the final 5% on occupancy (which could be 3 to 5 years away, presuming you purchased at launch)

Generally, price isn’t negotiable. In some instances, deposit structure can be pushed out, which can be helpful to an investor looking to preserve cash flow or to a first-time home buyer on a budget.

6. The 10-Day Rescission Period

By law, when you purchase a new home in Ontario, you have what’s known as a 10-day cool off period. This means, from the time a purchaser receives an executed copy of their agreement from the developer, they have 10 calendar days in which they can walk away from the agreement with no recourse. This law is in place to ensure that buyers aren’t pressured into a sale at a showroom. In other words, it gives you time to “cool off” and do your own soul searching and due diligence before firming up.

We always highly recommend that you do most of, if not all, your due diligence and soul searching prior to signing an Agreement of Purchase and Sale. Otherwise, your 10-day rescission period could be a fairly traumatic experience full of second guessing yourself. It’s always best to objectively evaluate an opportunity before you are fully vested into it.

7. Hire a Real Estate Lawyer that Specializes in Downtown Toronto Pre-Construction Condos

A new home Purchase and Sale Agreement is a very thick document. Besides this, signing on for a new home can be quite intimidating! While fairly standard, these agreements are written by lawyers and can be somewhat one-sided to favour the developer. It cannot be stressed enough, how important it is to have a real estate lawyer – one that specializes in this line of work – to review the documents for you during the 1o-day rescission period. An expert lawyer in Toronto pre-construction will know what to look for, where the anomalies are, and what in the contract is up for negotiation.

Furthermore, these lawyers have the experience to guide a pre-construction buyer in the right direction. They will be able to walk you through the document and outline your commitments and closing costs. In fact, the closing costs – including developer charges and taxes – can be upwards of $75,000. And, since you can’t roll these costs into a mortgage, it’s important to be aware of what could be coming down the pipeline in 3 to 5 years, should you decide to move forward.


8. Understand the Assignment Clause and Right to Rent During Occupancy Period

The right to assign means that you, as the purchaser, have the right to sell your contract to another buyer prior to occupancy. This is beneficial to have as part of your agreement. It gives you the option to sell the property so that you’re not locked in until close. However, make sure to read the agreement fine print for any limits to your ability to assign the property – something that should be reviewed with your lawyer. With this, check that you have the contractual right to rent out your property during the occupancy period, as in many instances, the developer will not allow for it. This condition is important, even if you are intending to live in the condo since many things can change over a period of 3 to 5 years.

9. Expect Condo Maintenance Fees to Rise

As a pre-construction buyer, you should keep in mind that the developer is making assumptions on what the condo budget could be like once the building is complete. More often than not, the developer is incentivized to make these projections appear as low as possible to appeal to a prospective purchaser (like yourself). In reality, upon completion, the condo corporations may find themselves underfunded and because of this, increases to the monthly maintenance fees result. Any investor or end-user running a pro-forma should always take this into account.

10. Think About Interim Occupancy

The interim occupancy period is when you get the keys and possession of the condo. But, you do not actually own the property until the building registers and ownership transfer from the developer into your name. Another key point: this is when your mortgage kicks in. On average, the interim occupancy period can take from 3 to 9 months. During this time period, you are paying what is known as a “fantom mortgage”. This consists of interest on the principal owning plus maintenance fees and property taxes to developer. And, this occurs on a monthly basis until the building registers. Furthermore, during the interim occupancy period, you will not be making any mortgage payments on your principal.

11. Factor in Closing Costs

There are a lot of costs to consider as a pre-construction buyer. Specifically, these are costs that are due on close and which are not on the developer’s price list or disclosed in their marketing material. It’s imperative that you have a qualified lawyer review all these costs so that you can properly evaluate the opportunity. What’s more is that you’re not taken off guard when the property closes 3 to 5 years from now. The average closing costs can range from 2 to 4%. These costs include, but are not limited to:

•Development charges

•Land transfer taxes

•Utility connection fees

•Education levies

•Park levies

•Reserve contributions

•…and, the list goes on.

The moral of the story is, don’t get caught off guard! Know your costs and what can be capped at the time of purchase.

12. The HST Rebate

The HST rebate is not always clearly explained at the time of purchase. So, it’s important to understand that HST (unlike resale) is applicable to all new home purchases. As a pre-construction buyer, if you are an end-user (meaning, you are going to live in the condo), the developer will pay HST and will, in turn, have the right to apply for the rebate. If you are deemed to be an investor, you will have to pay the HST owing and have the right on your own behalf to apply for the rebate. You should speak to your lawyer prior to purchasing or before going firm, so that you are clear on how this could financially impact you on closing.


Pre-Construction Buyer Questions?

As you can see, there are many considerations to be taken prior to purchasing a new home, especially as a pre-construction buyer. This is a big purchase! So, there’s one more thing to consider – make sure you have the right team behind you to help you ask all the right questions (and answer them too). The Townsend Team knows pre-construction, and we can be your team.


Michael John Lau, Salesperson

The Townsend Team Real Estate Network
Century 21 People’s Choice Elite Realty Inc.

Direct:  (647) 308-9000  |  Office:  (416) 238-9667


Pre-construction Condo's

Below are my current Top Three Pre-construction Condo's in Downtown Toronto.

Via Bloor Condo's is located at Parliament and Bloor St E. Steps to Yorkville and easy access to pubic transportation. Perfect for University Student's, young professionals, and downtown commuters!


Toronto New Condos


The One Condos is located at Yonge and Bloor. This building will become the second tallest in Canada next to the CN tower. With Mizrahi Developments as the developer, this building will be a monument of Yorkville.


Toronto New Condos


Panda Condos will be right at Yonge and Dundas, the Core of Downtown Toronto. This location is perfect for literally everyone! University students, Shopaholics, 9-5ers, and all those who are interested in Toronto's Night Life.


Toronto New Condos


Black Friday Top Buy For Home Owners

1. Philips Hue A19 Smart LED Light Bulb Starter Kit


Light up your home with creativity and convenience with the Philips Hue smart light bulb! You can control your lighting options with your smart phone. The lights can be adjusted to the specific moods or programmed to work as handy alarms and timers.

Save $50 between at Best Buy for $129.99 (Reg Price $179.99)


2. Nest Wi-Fi Smart Thermostat 3rd Generation


If you don’t have one already, the Nest Thermostat will remember what temperatures you like, learns your schedule, and programs itself to save money on your gas bill.

As a bonus, you can receive $100 Enbridge bill credit!

Save $70 at Best Buy for $259.99 (Reg. Price $329.99)

3. Ring WiFi 720p Video Doorbell



If you want to feel safe when your not at home, this gadget will do the trick! Ring will allow you to see and speak to the person at your doorstep without you leaving your cozy sofa or comfortable bed. It is Wifi enabled and battery operated all from the touch of your smartphone.

Save $70 at best Buy for $169.99 (Reg. Price $239.99)




If your a busy person and don’t have time to clean, the iRobot 630 Vacuum Cleaner is here to help.

Save $210 at Canadian Tire for $287.99 (Reg. Price $499.99)




Whether you are changing the lightbulbs, repairing ventilations, doing electrical work, every household should have a ladder.

Save $80 at Canadian Tire for $49.99 (Reg. Price $129.99)