A perfect storm has been quietly brewing in Canada’s pre-construction condo market, creating an environment where neither developers nor buyers can come out ahead. On the developer side, rising construction costs mean they must list properties at higher prices to remain profitable. For buyers, with high interest rates in mind, these high prices look unappealing compared to potential resale values and rental income. The result? Sales have slowed, fewer projects have launched and prices remain stubbornly high.
Many buyers have instead turned to the resale condo market. A flood of new listings has led to more competitive prices, even when accounting for differences in finishes or amenities.
Pre-construction condos still offer unique opportunities to buyers looking to enter the market. Here’s how:
Benefits aside, purchasing a pre-construction property comes with a specific set of risks. Here are some that all buyers should factor into their decision-making.
The pre-construction condo market in Canada is currently facing significant challenges. High prices and market uncertainty make it a risky investment, especially for first-time buyers. However, with an informed approach, buyers can still find unique opportunities in this area of the market.
This article offers general information only and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or its affiliates.
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