Tuesday, January 19, 2016

You can't avoid levies on your condo purchase, but you can anticipate them

Posted in: metronews.ca
By: jeffreycowanmetro Metro, Published on Thu Jan 07 2016

Extra fees like parks and development charges are commonplace when buying a condo in Toronto

Q: I am about to close on my newly built condo that I am purchasing from a builder and my lawyer has sent me  the final statement of adjustments.  There are ‘levies’ for parks and development charges that add up to several thousands of dollars in addition to the funds I need to bring in to my lawyer in order to close my purchase.  I did not budget for this. Is there any way I can avoid these charges?
A: Standard in all contracts for the purchase of a condo these days are adjustments for a variety of costs; two of the largest are park and development charges.  The City charges developers of condo buildings these types of fees in order to support municipal infrastructure and develop greener cities.  When you signed the agreement of purchase and sale, there would have been a specific provision outlining these two charges and the builder is now setting those hard costs which they are contractually able to transfer to the individual purchasers.  When a client brings me a contract for review, I always advise them to go back to the builder in the cooling off period to get these two important charges ‘capped’.  This does two things, it makes my client consider these additional costs and allows for budgeting of final costs well in advance of receiving the final statement of adjustments from the builder.  You will not be able to avoid these charges but there can be greater certainty approaching final closing. Overall, you should be prepared for numerous final adjustments which will add to the final costs of your new home.
For information on buying or selling your property and the current real estate market, contact us by email or call  416-322-8000.

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