Buying A New Condo : What Can You Negotiate?

[Millenium]

I would like to purchase a brand new condo in the GTA this year.

Aside from haggling down mortgage rates with your lending company, what is the best way to save some dollars?
Is it possible to negotiate on things such as the list price, downpayment schedule or maintenance fees? Regarding the maintenance fees, I noticed the newer builders exclude hydro & parking fees. Is this typical nowadays?
Would appreciate any advice before I sign my name on the dotted line and drop my first downpayment.

[kramerz80]

I dont know about the list price or downpayment schedule, you MIGHT have a chance at negotiating a bit with those, maybe more on the downpayment, but I wouldnt see anyone being able to negotiate the maintenance fees. I think most if not all builders determine the maintenance fees based on a per square footage calculation. Maintenance has to be done and paid for, so I cant see you getting a break on it and having to make someone else in the building make up for it.

[beerbaron105]

possibly the downpayment schedule, other than that, if you dont buy it, 10 other people will

[elty]

See how much they are paying to agent and try to argue that amount.

[Millenium]

Thanks for all of your replies.
I sorta figured that the builder would have little room to budge. Probably throwing in a microwave would be the best they could do. Kinda like the days when you got a 'free' toaster when you opened up an account with a new bank.

See how much they are paying to agent and try to argue that amount.
This sounds helpful. How do I find out this information?

[beerbaron105]

Thanks for all of your replies.
I sorta figured that the builder would have little room to budge. Probably throwing in a microwave would be the best they could do. Kinda like the days when you got a 'free' toaster when you opened up an account with a new bank.


This sounds helpful. How do I find out this information?

if you want the decent deals, ur gonna have to camp out in front of the sales office a couple days before the grand opening, or any other special incentive program

[ali1800]

Thanks for all of your replies.
I sorta figured that the builder would have little room to budge. Probably throwing in a microwave would be the best they could do. Kinda like the days when you got a 'free' toaster when you opened up an account with a new bank.


This sounds helpful. How do I find out this information?

Call the Sales office and ask if they cooperate with brokers.... if they say yes, tell them you're an agent with **take your pick** and want to know the commission rate before bringing your client in. Yes it's a lie but it's a white lie.
So if the commission rate is 3%, you make be able to negotiate this with the sales person by telling them that your not using an outside broker.

Also remember that with new sale you almost always get to pick your own finishes. Maybe instead of the builder taking 3% off the price they can give you the equivalent dollars in credit for your finishing upgrades. This is better for the builder as $1 of upgrades is always marked up and sometimes by 100%. But for you $1 is $1.

Personally I would take the upgrade dollars as the standard finishes in many condos are lame and what you see in most sales centres is upgraded.

Also, note that in many sales centres there are two to four sales people. If the first one doesn't budge/willing to negotiate, come in on a day that she/he is not there and work on a different sales person. Although for some builders the salesperson can't do anything about the price so they have to speak to their superior. Get their name/phone number and call them yourself.

good luck, tell us how it goes.

[elty]

Call the Sales office and ask if they cooperate with brokers.... if they say yes, tell them you're an agent with **take your pick** and want to know the commission rate before bringing your client in. Yes it's a lie but it's a white lie.
So if the commission rate is 3%, you make be able to negotiate this with the sales person by telling them that your not using an outside broker.

Also remember that with new sale you almost always get to pick your own finishes. Maybe instead of the builder taking 3% off the price they can give you the equivalent dollars in credit for your finishing upgrades. This is better for the builder as $1 of upgrades is always marked up and sometimes by 100%. But for you $1 is $1.

Personally I would take the upgrade dollars as the standard finishes in many condos are lame and what you see in most sales centres is upgraded.

Also, note that in many sales centres there are two to four sales people. If the first one doesn't budge/willing to negotiate, come in on a day that she/he is not there and work on a different sales person. Although for some builders the salesperson can't do anything about the price so they have to speak to their superior. Get their name/phone number and call them yourself.

good luck, tell us how it goes.

I partly disagree. Most condo has better standard stuff (many come standard with hardwood floor, decora switch where a house builder like to rape you for), so try your best to get cash first. You probably won't get the full amount. If that fail, try to have a broker, told him you already made your choice and ask if he can rebate you partially on the commission he earn. Some will, some won't.

Also, this is only the starting point, it doesn't mean that's all you can negociate. Odd unit that can't sell for a long time (I have seen a builder failed to sell a 14th floor unit for over 1 year in phase 1, when they are already having phase 3 for sale) you may have a bit more room.

[ali1800]

I partly disagree. Most condo has better standard stuff (many come standard with hardwood floor, decora switch where a house builder like to rape you for), so try your best to get cash first. You probably won't get the full amount. If that fail, try to have a broker, told him you already made your choice and ask if he can rebate you partially on the commission he earn. Some will, some won't.

Also, this is only the starting point, it doesn't mean that's all you can negociate. Odd unit that can't sell for a long time (I have seen a builder failed to sell a 14th floor unit for over 1 year in phase 1, when they are already having phase 3 for sale) you may have a bit more room.

These are some good points there but I strongly disagree on the finishes. Very recently I noticed that builders are moving away from pre-engineered hardwood on cheaper condos. It's usually laminate and often it doesn't run in the bedrooms. Standard appliances which are often stainless steel are still bottom of the barrel models. Also, finishes you can easily do in a house that are nearly impossible to do in a condo are electrical upgrades like ceiling or wall lights, extra cable & phone outlets, halogen lights, etc., shower jets, switch tub to shower or vice-versa, redesign kitchen, bathroom, etc. (Changing switches to Decora style are easy to do anyway).

On a side note: Regarding the 14th floor, noticed some builders *ahem Cityplace* got around this by removing the number 4 on all floors and SUITES! LOL


One item I forgot to mention: sometimes an outside agent/broker that has a good relationship with a builder (high sales) may also be able to negotiate a better deposit structure or incentive if not the purchase price. But finding out whom is nearly impossible without some inside knowledge.

[BMNB3tches]

possibly the downpayment schedule, other than that, if you dont buy it, 10 other people will

right. Until the music stops and this glut of inventory stalls the market.

For those who say "it'll be different this time", in EVERY asset market there are peaks and troughs. As soon as the banks start tightening up their lending practices.
I don't think the Canadian banks have revealed their true exposure to bad debt. Look at the bank stocks no one is buying them here.


How quickly we forget the tech bubble of year 2000 :o :o :|

[Thalo]

The other day I had a look at a condo in suburban Edmonton, tiny two bedroom, that was selling for (or at least on sale for, probably won't sell) $400K. I offered $250K and I think in kinder words was told to leave or have a look at some condos on the outskirts of town. >:(

[HunkaHunkaBurningLove]

I'm not totally up on my housing prices, but I believe that $250K might get you into a 700 sf apartment style one bedroom condo in Calgary. Here's one that sold for $235K, but I don't know when that was:

MLS # C3211210
Suite 134
69 SPRINGBOROUGH CO SW
Location:Springbank Hill
Asking Price:$ 234,900Condo/HOA fees: $216/$50

[Thalo]

$250K gets a slightly less than 1000sqft 2 bedroom condo in Edmonton. The place was slightly over 1000sqft and brand new, so I was hoping they would counteroffer with $300K but there was no counteroffer...

$400K is shear lunacy. I can get a decent sized house for that much, even build brand new.

[ali1800]

I'm not totally up on my housing prices, but I believe that $250K might get you into a 700 sf apartment style one bedroom condo in Calgary. Here's one that sold for $235K, but I don't know when that was:

MLS # C3211210
Suite 134
69 SPRINGBOROUGH CO SW
Location:Springbank Hill
Asking Price:$ 234,900Condo/HOA fees: $216/$50

Downtown Toronto: 455 Sq. Ft. (no parking) $259,000.00

http://toronto.craigslist.ca/tor/rfs/580342632.html

[HunkaHunkaBurningLove]

I've seen what those micro-condos are like in TO. They are like long skinny hallways basically with a washroom and kitchen tacked on the side. Wow, that's just craaaazy! I guess that's the price to pay to live in the centre of the universe. ;)

$400K for a 1000 sf condo is just a tad high I would say unless it's in some posh area of town with some sort of country club membership included. ;) I know Edmonton prices have gone up actually faster than Calgary, but there's been a bit of a "correction" in the house marketplace I'm seeing. You can see houses listing for $10K less lately. For a 1000 sf two bedroom condo somewhere around the $300-350K mark might actually be right in certain areas of town.

[Thalo]

I've seen what those micro-condos are like in TO. They are like long skinny hallways basically with a washroom and kitchen tacked on the side. Wow, that's just craaaazy! I guess that's the price to pay to live in the centre of the universe. ;)

$400K for a 1000 sf condo is just a tad high I would say unless it's in some posh area of town with some sort of country club membership included. ;) I know Edmonton prices have gone up actually faster than Calgary, but there's been a bit of a "correction" in the house marketplace I'm seeing. You can see houses listing for $10K less lately. For a 1000 sf two bedroom condo somewhere around the $300-350K mark might actually be right in certain areas of town.

I would say downtown or with a river valley view: 350-400. Suburbs: 250-300. Suburbs for $400K is ludicrous.

[gman]

$500 per square foot is considered good price for a new condo in downtown core of Toronto these days.