What are some of the differences you would find when purchasing a brand new condominium and a brand new freehold home?
When you buy a new condominium you have a 10 day cooling off period, to get cold feet and back out with no questions asked. When you purchase a new homes or resale home or condo no time is allowed after you sign unless you have ensured that there is a schedule or clause making the transaction conditional for a given period of time on your lawyers review and approval. This gives you an opportunity to see your lawyer, get suggestions, changes, and explanations and then return and negotiate.
Another difference is that with a new condominium you have in effect 2 closings. It works like this. The first closing is the occupancy closing date, the day you move in. Until the condominium is registered you are paying money to the Vendor that does not reduce your principal on the mortgage. It is like rent and is a total of the interest on the outstanding balance of the purchase price plus your proportionate condominium common expenses and no you can’t get around this. The second closing is the day that title is turned over to you. This is the date you pay the balance of the purchase price, own your condo, register your mortgage and live happily ever after. It may be anywhere from the same day as occupancy to a year or more later.
A condominium is a creature of statute and as a result there are very particular laws governing its operation. As an example there may be bylaws or rules setting out the fact that there can be no pets in the units. In your own home as the saying goes you are the King or Queen. In a condominium you need to pay a monthly fee that includes everything from contributions to a reserve fund, insurance, heat, hydro, television and maintenance. This amount can vary from year to year as the cost of running the building increases or decreases. In your freehold home, insurance, heat, hydro, maintenance, etc. are your personal responsibility and you deal with them as you deem necessary.
The operation of your condominium is carried out by public will. In other words you elect a board of directors to operate the condominium corporation and these people decide on how things will run. Again in your freehold castle, you are the boss.