[dinosaur]

Okay...so a few pages back I posted an ad I saw for a condo development in New Westminster called Elliot. The ad said something about the developer paying the mortgage for the first 24 month but had no fine print. I registered for the property, but did not receive anything via email so today, when Grid and I had a free afternoon, we decided to go take a look at the presentation centre. We are not really interested in buying, but more just curious about this 'offer' and the fact that it is being built almost across the street from one of our rental buildings.

Overall, nice layout, nice features, fairly typical materials, better utilization of space than others I have seen, and many features are standard where in other new developments are "upgrades". So basically....we were pretty impressed.

Talked to the sales staff about this 24 month thing, pricing, etc:

You are given two options by the developer to cash-in on this 24 month free living (all these numbers are based on today's interest rate 5-year closed mortgage over 25 years with 20% down).

1- The developer will give you the equivalent of 24 mortgage payments off the purchase price. So, a 1 bedroom (4th floor) is listed at $229,900. 24 months of payments is $21,600...this means your purchase price is $208,300. The 2 bedroom (6th floor) price is $354,900. 24 months is $33,600...final price is $321,300. Townhouse is $429,900 less the mortgage of $40,800 for purchase of $389,100.

This is pretty much what I figured when I read "developer to pay 24 months of mortgage"....HOWEVER, the 2nd option I did NOT expect.

2- You buy the place but do not plan to live in it. The developer will actually pay your strata payment and along with "rent" for 5 years (Dec 2019). Essentially, the developer acts as a property manager. Breakdown:

1 bed: $800\month + $205.66 strata= 1005.66 check in your bank every month for 5 years.
2 bed: $ 1300\month + $308.49= $1508.49 monthly.
Did not get pricing for townhouse.

The developer takes the risk in renting out the suite...if there is no renter, you are still paid. The amount given to you every month is essentially suppose to cover your mortgage payment every month but depending on interest you get and you downpayment you could be rental neg, neut, or pos. Its basically up to you...BUT for 5 years it sits there with someone else managing the tenant.

If at some point you decide you want to live in your place, you just give the tenant proper notice and the developer stops paying you.

If I was going to buy....I'd purchase a 1 bed and go with option 2 or I'd buy and 2 bed and go with option 1. The townhouses were ok, but there is no real benefit...there is no garage or private access so to speak and it is literally ALL windows....nice, but not for street level.

In regards to pricing of the units, I was pretty impressed at the cost. I expected them to be easily be listed about $30,000 more when comparing to others for sale in New West right now. They are pretty on point and if anything, priced a little under even with this 24 month promo thing.

Penthouse is going for mid-$700k and is pretty fucking nice. Epic view and cheaper than some other new development penthouses in the area.

So, interesting incentive they are offering...I wonder if we will see more of these pop up. Was talking to a family member who deals with mortgages, etc and she said this was the first she has heard of such thing (2nd option). I guess the benefit the developer gets with promo 2 is they can rent the apt for more than what they are paying you....after walking through the 1 bed, that thing would easily rent for $1200. The 2 could fetch $2000....but would be much harder to rent.

I'll have to keep my eye out for other interesting incentives.