When purchasing a condo, you’ll have two main options to consider: presale or resale. Presale condos are units bought before they’re completed, sometimes years before move-in, whereas resale condos are existing properties sold by their current owners. Each option offers unique advantages and considerations, depending on your timeline, budget, and overall needs. Here’s a closer look at the pros and cons of each option to help you make an informed decision.
1. Timing Your Mortgage
Presale: With a presale, your mortgage won’t start until the building is ready for occupancy. This could be years from the time you sign the purchase agreement, allowing time to save or prepare financially. For instance, if your unit’s completion is slated for fall 2025, mortgage payments begin only then. During this waiting period, only a structured deposit payment is due, typically divided into phases over the years.
Resale: For resale condos, mortgage payments start shortly after the purchase is complete, usually within weeks of closing. If you’re ready to move in and begin payments immediately, resale is a straightforward option. However, if you need time to arrange financing or prepare, presale offers more flexibility.
2. A New Property vs. Existing
Presale: With a presale condo, you’re assured a new, modern unit with up-to-date finishes, appliances, and possibly cutting-edge smart-home features. You’ll be the first to live in the property, minimizing immediate maintenance costs. New condos often come with warranties, including BC’s 2-5-10 warranty, covering defects in workmanship, systems, and structure for up to ten years.
Resale: Resale condos come with unique benefits, but they may have wear and tear and potentially outdated features. However, you can assess the unit’s current condition firsthand and understand what updates may be needed. Some buyers prefer the character of an established building or neighborhood and the added benefit of knowing the property’s track record in terms of value and maintenance.
3. Due Diligence and Inspections
Presale: Buying presale means you won’t see the finished product until completion. You can visit the presentation center and see renderings, but inspecting the physical property isn’t possible yet. As a result, due diligence relies on researching the developer’s track record, reviewing plans, and consulting an experienced real estate advisor. If possible, it’s a good idea to visit similar buildings completed by the same developer.
Resale: With resale condos, you have the advantage of seeing the unit before buying, conducting inspections, and reviewing strata documents. These documents, like the building’s Form B, strata minutes, and financial statements, provide insight into the building’s history, past repairs, strata rules, and the community culture.
4. Completion Timeline
Presale: Presale condos often come with longer timelines, sometimes three years or more from purchase to move-in. If you’re not in a rush and are comfortable waiting, presales can be a great option. This gives you more time to plan, save, and even sell an existing property without a time crunch.
Resale: With resale condos, the process is much faster. Most resales are ready for occupancy within one to three months after closing, ideal if you need a new home right away or prefer a quick transaction.
5. Customization Options
Presale: Many developers allow buyers to choose from upgrade options, such as countertops, flooring, or appliances. Some presale units even allow for minor layout changes or additional customizations before construction begins, letting you design a space that fits your tastes perfectly.
Resale: Resale units come as-is, so customization comes through renovations after purchase. This can be advantageous if you’re looking to personalize your space immediately but may involve added costs for upgrades. For those interested in increasing a property’s value, strategic upgrades can enhance a resale condo’s appeal and equity over time.
6. Strata Rules and Grandfathered Policies
Strata rules can impact your lifestyle, especially for pet owners or investors.
Presale: A presale purchase can allow buyers to be "grandfathered" into strata policies set at the time of purchase, even if rules later change. For example, if rental or pet restrictions are added after your purchase, they may not apply to your unit. This can provide flexibility, especially if you plan to rent out your condo or own pets.
Resale: When purchasing a resale, you’re subject to the strata rules in effect at the time, and any policy changes will immediately apply to you. However, buying resale allows you to review these policies before committing, giving you a clear picture of what to expect in terms of building guidelines.
7. Strata Fees and Potential Assessments
Resale: With a resale condo, strata fees may be higher to cover maintenance for aging infrastructure or unexpected repairs. Special assessments, which are one-time fees for major repairs or upgrades, are also more common in older buildings. This potential for higher costs is something to consider when buying a resale, as it can impact your monthly budget.
Presale: In a new building, strata fees tend to be lower initially, though they may increase as the building ages and requires more maintenance. However, new condo buyers are typically protected by the 2-5-10 warranty, helping to reduce repair costs in the initial years.
Pros & Cons Summary
Pros of Presale:
- Delayed mortgage start provides more time for financial preparation.
- Customization and upgrade options for finishes, layouts, and appliances.
- Warranty coverage (2-5-10 years) protects against major repairs early on.
- Potential for property appreciation during the construction period.
- Grandfathered strata policies offer flexibility if rules change.
Pros of Resale:
- Immediate move-in ability after purchase.
- Full opportunity to inspect the property before buying.
- Potential for price negotiation with the seller.
- Access to well-established neighborhoods and communities.
- Strata and community information is fully available beforehand.
Cons of Presale:
- Longer wait until move-in, often taking years to complete.
- Limited ability to view or inspect the finished unit.
- Market value may fluctuate during the build period.
- Risk of construction delays impacting completion timeline.
- Less certainty around final property and community features.
- May require renovations or updates, especially in older units.
- Aging infrastructure can mean higher or more variable strata fees.
- Special assessments more common in older buildings.
- Limited options for customization post-purchase.
- Potential for higher maintenance costs due to property age.
Which Option is Right for You?
Developer Preferred Realtor - Buyer Representation Available for all Presale Opportunities
Learn more: GillespieGroup.ca/Presales
This is not an offering for sale. Any such offering may be made only with a disclosure statement. Prices and specifications are subject to change. E.&O.E. Not intended to breach or induce any existing client relationships. This is not legal advice, recommended to seek independent legal advice.