Just a reminder to first-time condo buyers to look at the big picture when making your decision on what you can afford. On closing day, you will have to come up with closing costs. These include items such as the balance owing on your deposit, your contribution to the condominium corporation’s reserve fund, your enrolment fee for Tarion Warranty Corporation, Law Society fee, Land Transfer Tax, hook-up for utilities, etc.
There may be others. The reality is that nowadays the government is demanding higher development charges from condo developers. The cost of land has risen, these charges are growing, and there are further increases in the wind for 2014. Some of this rise is distributed back to the buyer.
The best thing to do is ask your sales representative and lawyer. Many closing costs will be listed in the adjustment section of your Agreement of Purchase & Sale. Read this carefully so you understand the condominium corporation’s role and your portion of the maintenance fees, along with other important information. For example, most developers today include HST in the purchase price – check to be sure.
Once you sign on the dotted line, your suite is removed from the market for 10 days to allow you time to consider. Make the most of this time by taking the Agreement to a lawyer so you understand your legal commitment. In fact, your lawyer should go through this and any other condominium documents you receive. Your legal representative will spell out other closing costs for you, so you can factor it all in for the day you take possession.
As a guideline, we suggest that you put aside at least 3% to 5% for closing costs on a new construction condominium. On closing day, the only surprise you want is that your new suite is even more beautiful than you imagined!