Investing from out of province works the same as if you were standing in Calgary in-person yourself and everything can be done remotely, including management of the unit! You never have to go to Calgary or even see the unit you purchased.
Once you’ve decided on a unit, simply submit a Suite Reservation Form or “Worksheet” containing necessary details such as your legal name, address, contact information, occupation, employer, and a valid identification photo (usually a driver’s license or passport). This aids the developer in preparing the purchase agreement and helps me keep track of additional preferences like parking, locker purchase, multiple purchasers, or the inclusion of a Holding Company in the agreement.
In some cases, time is of the essence, requiring swift action within minutes to secure your unit. Pre-submitting a unit registration form allows for instant reservation, bypassing potential delays associated with waiting for form submission. The process is quick, taking less than 5 minutes to complete. Access the form here:
Upon receipt of your submitted information, the developer promptly generates your purchase agreement, often completing the Agreement of Purchase and Sale (APS) within 24 hours due to its largely automated nature. It’s crucial to sign the agreement within 24 hours of receiving it, as failure to do so may result in the developer voiding the contract and reclaiming the unit. This practice helps sift out individuals who are not genuinely committed to the purchase process and initiates the “clock” for the 10-day cooling period.
In the fast-paced world of real estate, some developments can sell out within mere hours, leaving little time for thorough due diligence. Thankfully, Alberta law provides a safety net in the form of a 10-day cooling period, allowing buyers to back out of a deal without penalty for any reason. This 10-day period, which includes weekends and holidays, begins the day you sign the agreement. Should you choose to exercise this option, simply send an email to the builder to inform them of your decision to withdraw from the purchase – no complicated forms required.
While not mandatory for purchasing a pre-construction property, engaging a lawyer at closing is advisable. It’s prudent to have your purchase agreement reviewed within the cooling-off period to ensure there are no deal-breaking clauses or terms you find unacceptable. Despite limited room for negotiation, legal insight can be invaluable, given that contracts typically favor the developer’s interests.
In Alberta, where nuances in real estate law vary from other provinces, a lawyer familiar with local regulations can provide essential guidance. For instance, terms like “duplex” and “occupancy” may carry different meanings across jurisdictions. Additionally, to facilitate property closure, your lawyer must have access to the province’s land titles registration system. If you already have legal representation, it’s worth confirming their capabilities; otherwise, I can assist in referring you to a suitable lawyer.
When purchasing a pre-construction unit, securing a mortgage is only necessary at the closing stage, not during the initial purchase. In Alberta, the mortgage application process mirrors that of other provinces, with major banks and financial institutions operating nationwide.
Although an actual mortgage is obtained at closing, many developers require a mortgage pre-approval within the cooling-off period. This preliminary approval assesses your financial status, including employment, income, debts, and real estate holdings, without conducting a credit score check.
Obtaining a mortgage pre-approval should be your first step before exploring properties, as it determines your borrowing capacity and budget. It’s crucial to align your property search with your financial capabilities to avoid disappointment.
The actual mortgage financing is contingent upon your financial situation at closing, which could be several years away. Due to Covid-related delays, banks may experience backlog, underscoring the importance of early mortgage organization to avoid penalties and fees.
While not all mortgage brokers can facilitate mortgages in Alberta, I collaborate with trusted partners who can assist seamlessly. Feel free to reach out for a referral if needed.
It’s important to note that for traditional mortgages from any bank in Canada, a minimum 20% down payment is required for rental properties. If you’ve put down a 10% deposit with the developer, you’ll need to provide an additional 10% at closing, as all deposits count towards the 20% requirement. Any claims of less than 20% down payment typically apply to owner-occupied homes requiring CHMC insurance or may be misleading.
While some developers may accept post-dated personal cheques, in most cases, deposits must be made using one of the following methods:
Wire Transfer: Visit your local bank to wire the funds directly to the developer’s lawyer, incurring approximately a $50 fee.
Bank Draft (MOST COMMON): Obtain a bank draft from your local bank and deposit it into the developer’s lawyer’s bank account, typically BMO or TD, with a cost of about $8.
Deposits are safeguarded by provincial law and held in-trust by the developer’s lawyer. In the event of building cancellation or developer bankruptcy, your deposits are protected, ensuring their return.
Please Note: I am not a tax expert, so I recommend consulting with your accountant for personalized advice.
In Alberta, buyers from other provinces do not incur any special taxes or fees. Alberta offers several advantages for real estate investment:
• NO FOREIGN BUYER TAX: Regardless of residency, Canadian citizens and permanent residents can purchase real estate in Alberta without paying any special “foreign” taxes.
• NO LAND TRANSFER TAX: Unlike in provinces like BC and Ontario, Alberta does not impose specific taxes related to real estate transactions. This results in significant savings, such as avoiding the hefty $32,950 tax on a $1M property sale in Toronto. There is only a nominal Property Registration Fee, typically a few hundred dollars.
• NO DEVELOPMENT CHARGES: Unlike other regions, Alberta, particularly Calgary, does not levy development charges, which are essentially taxes imposed by local municipalities to fund infrastructure projects.
• NO PROVINCIAL SALES TAX: Alberta imposes only a 5% sales tax on goods and services purchased, making it an attractive location for buyers.
Regarding income taxes on property appreciation upon sale, the rules are determined by the Canada Revenue Agency (CRA), a federal entity. The treatment of income and capital gains is uniform across provinces.
All new homes in Alberta are covered by the Alberta New Home Warranty Program – this provides coverage for a 10 year period:
• 1 YEAR – MATERIALS & LABOUR: Coverage for defects in materials and labour (baseboards, flooring, trim, and paint).
• 2 YEAR – DELIVERY & DISTRIBUTION SYSTEMS: Coverage for defects in materials/labour related to delivery & distribution systems (heating, electrical and plumbing systems).
• 5 YEAR – BUILDING ENVELOPE: Coverage for defects in the system of components that separate the conditioned space from unconditioned space (roof, exterior walls).
• 10 YEAR – STRUCTURAL: Coverage for the load-bearing parts of the home (frame, foundation).
Prior to closing on the unit, there will also be an Occupancy Inspection to walkthrough the property to inspect for any deficiencies. You can do this yourself, you can send someone anyone to do it on your behalf, or you can have a building designate walk you through the inspection remotely on a Zoom call. There are always “deficiencies” that the builder will fix and touch up and some seasonal items and exterior work may not be able to be completed until later (e.g. pouring concrete, landscaping, etc.)
Many of my clients invest in units located outside their residing cities. While some opt to manage their units independently, the convenience of online ordering makes this feasible, especially for condos where issues typically involve a plumber or locksmith.
For remote investors, hiring a property management company is often the wisest choice. These professionals handle tenant communications, payments, compliance with statutory regulations, maintenance, repairs, and day-to-day management, requiring your involvement only for major decisions or invoice payments.
In Alberta, property management fees typically amount to 10% of gross rent plus GST, although rates as low as 6% are not uncommon. I advise using 10% for financial analysis purposes.
For clients who prefer a hands-on approach, I suggest initially managing the unit independently for a few months to gauge feasibility. Should challenges arise, you can always enlist the services of a property manager later.
In Alberta, rental units are primarily managed by property management companies, unlike Ontario and BC where real estate agents often handle rentals. These companies oversee the listing, advertising, and coordination of showings, as well as conduct due diligence on prospective tenants, including employment verification, reference checks, social media screening, and credit score assessment. The standard charge for their services is typically 1/2 of a month’s rent plus GST, whereas in the Greater Toronto Area (GTA), it’s typically a full month’s rent.
Your role in the rental process should mainly involve reviewing the due diligence provided by the property management company for prospective tenants and giving your approval.
At the time of closing, all associated activities can be conveniently conducted remotely, including signing paperwork with the lawyer, coordinating the mortgage with the broker, organizing insurance, and taking possession of the unit and keys.
Closing costs, which encompass the fees and expenses linked to transferring legal title to your name, vary significantly between Ontario/BC and Alberta. Below is a comparison of closing costs for a $500,000 one-bedroom pre-construction condo in Calgary versus Toronto:
TYPICAL CLOSING COSTS IN CALGARY:
CLOSING COSTS IN TORONTO:
** Upon renting out the unit for at least a one-year term in Ontario, you can apply for the HST Rebate, and it’s common to receive the full $24k rebate, making it more of a cash flow issue than a true expense.
” Seton is a master-planned community designed to be a new urban hub. The South Health Campus, Calgary Public Library, restaurants, shops and even a skatepark make it a destination for people living in south Calgary.
In May 2022, Seton won BILD Calgary’s Best Community of the Year for the second year in a row. We’re honoured to win twice, and happy that the Seton Urban District is being recognized as a great place to live and work.”
Compare listings
ComparePlease enter your username or email address. You will receive a link to create a new password via email.
calgary, condominium, postal code, preconstruction homes in calgary, construction, alberta, real estate agent, price, townhouse, chestermere, property, planned community, glacier, estate agent, neighbourhood, lake, multiple listing service, okotoks, virtual tour, bow river, rocky view county, occupancy, village, floor plan, public transport, mahogany, bungalow, willow, savanna, edmonton, shawnee, downtown calgary, demand, oak, mortgage, customer, attention, warranty, pine creek, mattamy homes, floor, lifestyle, acre, calgary stampede, energy, capitol hill, database, option, bathroom, landscape, rocky mountains, transport, sustainable living, cityscape, brampton, bedroom, etobicoke, pine, kensington, tax, imperia, mississauga, vaughan, welland, country hills boulevard, innisfil, courtice, oshawa, interest, barrie, duplex, cabinetry, room, basement, new homes in calgary, new construction homes calgary, new houses in calgary, new build homes calgary, new housing developments calgary, new homes in calgary canada, new homes calgary alberta, calgary homebuilders, house sale nw calgary
Is it a good time to buy in Calgary?
The current Calgary real estate market is showing strong potential for buyers, with various preconstruction townhomes and homes offering attractive cash flow projections and appreciation potential. Additionally, the absence of foreign buyer taxes and development charges in Alberta further enhances the investment appeal in Calgary.
How to buy pre-construction homes?
To buy pre-construction homes, submit a Suite Reservation Form with personal details. Once the developer prepares the purchase agreement, use the 10-day cooling period for safety. Secure a mortgage at closing, after the 10% deposit to meet the 20% requirement. Deposit methods include wire transfer or bank draft.
How long does pre-construction take?
The duration of pre-construction varies but can typically last around 12 to 24 months before completion. Delays are common due to factors like weather, labor shortages, or unforeseen issues, potentially extending the timeline further. It's essential to be prepared for potential delays in your investment timeline.
Is moving to Calgary a good idea?
Moving to Calgary is a good idea due to its pre-construction homes with potential cash flow, favorable real estate investment environment, and lack of additional foreign buyer taxes. With a 10-day cooling-off period and strong new home warranty coverage, it offers secure property investment opportunities.
How to build a house in Calgary?
To build a house in Calgary, first, secure land with necessary permits. Hire an architect for design, a builder for construction, and follow Alberta building codes. Secure financing and obtain essential inspections during each construction phase. Get a warranty, and consider property management for rental purposes.
Do you need pre-approval for pre-construction?
Yes, securing a mortgage isn't required during the initial purchase for pre-construction properties; it's necessary at closing. Preliminary approval evaluates financial status without checking credit score. A 10% deposit with the developer must be provided, with an additional 10% at closing.
Are pre-construction homes cheaper?
Pre-construction homes can be considered more affordable than existing properties due to lower initial costs and potential for value appreciation. These homes often offer early access to prime locations at competitive prices, making them potentially cheaper than buying a built property at a later stage.
Is it a good time to buy a house in Calgary?
The Calgary real estate market is ripe for investment, with various preconstruction homes offering cashflow or appreciation potential. Factors like low inventory, affordable prices, and stable market conditions make it a good time to buy a house in Calgary for both investors and homebuyers looking to capitalize on growth opportunities in the market.
Where to buy a house in Calgary?
Consider Seton Townhomes by Rohit in South Calgary, part of a master-planned community with amenities like the South Health Campus, Calgary Public Library, restaurants, shops, and a skatepark. Ideal for those seeking a vibrant urban lifestyle in Calgary.
Is pre-construction a good investment?
Investing in pre-construction properties can be a lucrative opportunity for generating cash flow and potential appreciation. It offers advantages like lower initial deposit requirements and the potential for customization. However, it carries risks such as construction delays or changes in the real estate market that could affect returns.
What is included in preconstruction?
Preconstruction homes in Calgary typically include features such as legal suites for cash flow, efficient designs, and energy-saving elements. Buyers can secure these properties with a 10% deposit, utilizing advantages like no foreign buyer tax and new home warranty coverage. Property management and closing costs are considerations during the purchase process.
Why is Calgary a good place to live?
Calgary is a great place to live due to its affordable real estate market, no foreign buyer tax, and numerous amenities in neighborhoods like Seton. The city offers new urban hubs, like Seton, with access to healthcare facilities, libraries, dining options, and recreational areas, making it an attractive location for residents.
Who is the best builder in Calgary?
Determining the best builder in Calgary can be subjective, as it depends on individual preferences, budget, and specific project needs. It's essential to research various builders, review their portfolio, consider customer reviews, and evaluate their reputation in the market to make an informed decision based on your criteria.
How many new homes are built in Calgary?
Calgary's new homes under construction vary by projects, with options including townhomes with legal suites for cash flow, master-planned communities in Seton, and new townhome developments in East Calgary. Each project provides unique features and investment opportunities to fit different preferences and budgets.
Is buying a house in Calgary a good investment?
Buying a house in Calgary can be a good investment due to factors like Alberta's lack of foreign buyer tax, no development charges, and the potential for property appreciation. New homes come with a 10-year warranty, making it a secure investment. Partnering with property management can ease landlord responsibilities.
Are pre-construction condos a good investment?
Pre-construction condos can be a worthwhile investment due to lower initial costs, potential appreciation, and cash flow from rental units. However, risks like construction delays and market fluctuations should be considered. Conduct thorough research and seek professional advice to make informed decisions.
What is preconstruction?
Preconstruction refers to properties that are not yet built or completed but are available for purchase. This includes townhomes and homes that are in the planning or construction phase, giving buyers the opportunity to invest early and potentially customize some features before completion.
What incentives exist for buying pre-construction?
Incentives for buying pre-construction include lower initial prices, potential for appreciation, customization options, and developer incentives like discounts or upgrades. Additionally, pre-construction properties often offer better financing terms and can provide higher returns compared to buying a completed property.
Can you customize pre-construction homes in Calgary?
Pre-construction homes in Calgary typically offer limited customization options due to set floor plans and designs by the developers. However, some builders may allow minor modifications with additional fees. It's essential to inquire about customization possibilities with the specific developer before purchase.
What are Calgarys pre-construction warranty coverage details?
All new homes in Calgary are covered by the Alberta New Home Warranty Program, providing 10-year coverage, including 1-year materials and labor warranty, 2-year delivery and distribution systems warranty, 5-year building envelope warranty, and 10-year structural defects warranty.
How do Calgarys property taxes affect new homes?
Calgary's property taxes can impact new homes by influencing overall ownership costs. Higher property taxes may result in increased expenses for homeowners, potentially affecting affordability and investment returns on new properties. It's essential for buyers to consider these tax implications when evaluating the financial feasibility of purchasing new homes in Calgary.
Are there environmental considerations in Calgarys building codes?
Calgary has specific building codes and regulations that focus on environmental considerations. These codes aim to promote energy efficiency, sustainable construction practices, and environmentally friendly building materials. Developers and builders in Calgary need to adhere to these guidelines to ensure that new constructions are in line with the city's environmental goals.
What financing options are available for pre-construction?
When purchasing a pre-construction unit, securing a mortgage is needed at the closing stage, not during the initial purchase. A 10% deposit is typically required, with additional funds needed at closing. Alberta offers no foreign buyer tax and no development charges, making it an attractive investment option.
How do Calgarys seasons impact construction timelines?
Calgary's seasons impact construction timelines due to weather variations. Winter, with cold temperatures and snow, can slow progress and delay projects. Spring and fall bring unpredictable weather, causing scheduling challenges. Summer offers optimal construction conditions, allowing for faster progress. Builders must plan strategically to navigate these seasonal changes efficiently.
What trends are influencing Calgarys housing market?
Calgary's housing market is influenced by factors like increasing demand for more affordable pre-construction properties, rising interest in properties with legal suites, and a growing interest in environmentally friendly and energy-efficient homes. Additionally, the allure of new urban hubs and master-planned communities like Seton is shaping the city's real estate landscape.
How is pre-construction quality ensured in Calgary?
Pre-construction quality in Calgary is ensured through the Alberta New Home Warranty Program, providing coverage for a 10-year period, including materials and labor defects. Developers prioritize adhering to construction standards imposed by local municipalities to maintain quality and uphold buyer confidence.
Are there pre-sale requirements for Calgarys new homes?
Yes, Calgary's new homes have pre-sale requirements. These often include a 10% deposit, completion of a Suite Reservation Form, and signing a purchase agreement within a 10-day cooling period. Mortgage approval is necessary at the closing stage, not initially. Closing costs in Calgary typically include land transfer tax, legal fees, title insurance, and registration fees.
How does Calgarys infrastructure support new housing areas?
Calgary's infrastructure supports new housing areas through master-planned communities like Seton, offering a range of amenities like the South Health Campus, Calgary Public Library, restaurants, shops, and a skatepark. This creates a vibrant urban hub and attracts residents to the region.
What are the risks of investing in pre-construction?
Investing in pre-construction homes carries risks like delay in completion, changes in market conditions, builder bankruptcy, and potential increases in construction costs which could affect resale value or cash flow projections. It's important to conduct thorough research and evaluate potential risks before investing.
How can I compare Calgary builders for new homes?
When comparing Calgary builders for new homes, consider factors such as track record, reputation, quality of past projects, and customer reviews. Research each builder's design style, customization options, warranties, and post-purchase services. Visit model homes, talk to current homeowners, and gather feedback from real estate agents.
new construction alberta, best preconstruction homes in calgary, cheapest preconstruction homes calgary, new homes for sale in alberta, pre construction townhouse, pre construction homes alberta, top properties sold in alberta in 2022, preconstruction townhouse, essential seton townhomes, preconstruction projects, east hills crossing, preconstruction homes, preconstruction, pre construction corona