When it comes to real estate investment, it’s challenging to choose the right development to place your investments. In Toronto, this has become increasingly difficult with the boom in preconstruction developments, known as “condo-turnkey” projects, in and around the downtown core. There are many questions to be asked and considered before investing in a condo-turnkey project: who are the owners? What are their plans? What are they going to build? Do they have enough money to complete the development? Will they need a co-developer to carry them through? There is so much uncertainty with each development project and investors should carefully consider the answers before making a big financial decision. These questions lead to the next question: what’s the development like? Before investing in a condo-turnkey development, investors need to examine the quality of the design and construction of each building. If you’re planning to purchase a condo-turnkey project, ask questions such as: who are the owners and how will they use your investment dollars? How many units are planned for the development? What does the presentation and marketing materials look like? Will the building look like the sales brochure? Do the images portray the actual state of the development? Are the design elements acceptable for the area and potential buyers? Will the exterior design of the building, such as the aluminum panels, reflect the area? Another concern with condo-turnkey developments is whether the project is designed to rent, hold, or sell. By focusing on a specific purpose, condo-turnkey projects create better long-term financial returns, since only the units that are sold are revenue generating units. By focusing on selling units, developers are exposing their investment to a wider audience, with more people looking to purchase than those considering renting. Investors must be aware that if a developer is primarily focused on renting, there is a high chance that units won’t be purchased by local residents or those within the area. It’s also important to ask about the final quality of the condo. If you’re planning to buy a condo-turnkey project, you want to be sure the units are in the high-quality range and that the finishings, such as ceramic countertops and quartz in the kitchens, match the other units in the development.
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