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What you’ll learn in just 17 minutes from today’s episode:
Learn and understand how preconstruction condos work from an investor, buyer, and developer’s point of view
Learn how to leverage from purchasing pre-construction condos
Find out the pitfalls...
What you’ll learn in just 17 minutes from today’s episode:
Resources/Links:
Summary:
Mitch Parker is an energetic and passionate, real estate sales and investment expert. He is the Vice President of Sales and Marketing with Hersh Condos; a real estate brokerage specializing in marketing and selling some of the top new developments in the Greater Toronto Area. He’s been investing in real estate since 2006 and has transacted hundreds of millions of dollars of property for both clients and himself while becoming a go-to media expert featured on Canada Am, CTV, SiriusXM, Toronto Sun, Huffington Post, and more.
In this episode, Mitch shares what goes into the whole process of preconstruction condos, the timeframe with which it can be livable from inception. Basically, he walks us through strategies in which you can profit from these properties while under construction and during the time it’s ready for occupancy, while also sharing potential disadvantages of this type of investment strategy.
Topics Covered:
Key Takeaways:
“Originally, I was selling homes, I was selling condos. And then I love business. I love the scalability of a business. So, selling buildings allows me to do that where you can come in some days, we’re selling like 120 to 150 condos in one day.” – Mitch Parker
“With pre-construction condos, if you can assign it down the road and make a fortune, that’s awesome. But you have to have that plan B, where you’re going to close the property, put a tenant in also, and sort of ride it out until the values are stabilized. At the end of the day, that’s really how you build wealth, by keeping the properties, paying down the mortgage, or having a tenant pay down the mortgage. And I think you thank yourself at the end of the day for it.’ – Mitch Parker
“Typically, a deposit structure would be like 5,000 on signing, balance, 5% in 30 days, and then your next 5% might come six months down the road, and then you might have another five for a year and a half down the road. So, it’s staggered out pretty well which is one of the nice advantages of doing it pre-construction condos.” – Mitch Parker
“And from a developer’s side, they’re putting up their own capital, they’re investing their time into it, you’re into hundreds of millions of dollars with these things. They do get paid well, for sure. But I would say it’s a direct correlation of the incredible risks that they take as well.” – Mitch Parker
“You always want to be working with a developer that has done it before and has built that kind of product before. You know a lot of headlines have come out about projects that are not getting built. And I think that’s probably the biggest risk, but typically, buyers are protected. The money that you put in a deposit goes into a lawyer’s trust account.” – Mitch Parker
“Some people like buying houses because they ultimately have the control of what they can do with the property, and with condos, you own a box in what is one of many, so you’re a little bit restricted. So, I think condos have to be your style and it has to be what you want to invest in. But it comes down to personal preference at the end of the day.” – Mitch Parker
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