PROS AND CONS OF SELLING AT OR AFTER REGISTRATION – REGULAR SALE:

  1. The ‘first buyer’ will pay the Land Transfer Tax and closing costs to the developer
  2. The Offer to Purchase is easier to understand.
  3. There will be carrying costs during the occupancy period and/or after. These costs can be minimized if one allows the ‘second buyer’ to occupy and pay a rent to the ‘first buyer’ during part of the occupancy period. Or the ‘first buyer’ can rent the unit in the occupancy period and after registration to a tenant, and then sell later.
  4. If you never allow a tenant or the ‘second buyer’ to occupy the unit, you may be able to declare the property as a ‘principle use’ property and hence avoid Capital Gains tax.
  5. HST may or may not be applicable, depending on point (4) above and point (3) under ‘BEFORE REGISTRATION’.
  6. The ‘second buyer’ can arrange mortgage financing for the purchase and the property can then appeal to high ratio buyers i.e. a larger pool.
  7. Property will sell at market value.