Registering for Access to Pre-Construction Condos

There are a few ways to buy a condo. You can buy an existing one, a new one or one that has yet to be built. The first two options are fairly straightforward and similar to buying a house.

However, buying a pre-construction condo is a whole different ball game. In a previous post, I talked about what you need to know before buying pre-construction. In this post, I want to cover the often misunderstood process of registering with an agent or brokerage for preferred access to units before they become open to the public.

Referred to as Platinum VIP and VIP access, there are actually several stages a developer releases units through. And this is why, buy the time doors open to the public, a building can be 75-90% sold.

The stages generally go like this:

• Friends and family
• Platinum VIP
• VIP - there can be a few releases at this level
• Open to public

There are only so many Platinum VIP Realtors in the GTA and they don’t work with all developers. Platinum VIP agents are each given a specific allocation of units in a building that they have the exclusive right to sell.

Platinum VIP agents are given this early prime allocation because they have built up trust with the developer by consistently bringing serious high quality buyers to the table. Because of this, they get the best pricing and incentives for their buyers at this early selling stage.

If you are serious about buying a unit in a particular development, be sure to find a legitimate Platinum VIP agent for that building. You will see lots of ads “pre-selling” new developments and encouraging you to register for access. Unfortunately, this is often just a sales tactic to get your contact details and they may not have any units allocated to sell.

Once the Platinum period has passed (typically 2-3 weeks), the next round of allocations goes to VIP agents. Similar to Platinum, VIP agents are given a specific allocation of units to sell for a limited period of time.

Depending on demand, the pricing of units will be slightly higher at this stage.

At this stage, the developer’s sales centre is open to the public directly to sell any remaining units. Buyers can now purchase directly from the developer, without needing an agent. At this phase, prices will be higher again and are typically in the $1 million plus range (depending on location and demand).

Your best bet to secure a condo in a new development is to get in at the early VIP stages. However, you will need to be prepared to act quickly . These phases are only available for a limited time and to a limited number of agents, so units can go fast.

Be ready:

• Meet with your Platinum VIP or VIP agent when you register with them to get all the information you will need when decision time comes
• Have your mortgage pre-approval organized
• Ensure you have all necessary ID, including your SIN number
• Have your deposit cheques ready - typically $5,000 to $30,000 at signing, 5% in 30 days, 5% in 60-90 days and 5% in 90-270 days