Preconstruction condos can be a fantastic investment opportunity, but there are some hard truths that buyers and realtors need to understand before jumping in. After selling over 200 preconstruction units, I’ve seen the same issues come up repeatedly. Here are four critical things you need to know to protect yourself and make smart investment decisions.

Ugly Truth #1: Marketing Materials Are Not Legally Binding

Everything a developer provides—brochures, floor plans, websites, and project descriptions—is considered marketing material. This means you cannot hold the developer accountable for any discrepancies between what was advertised and what you actually receive.

For example, if a floor plan states the unit size is 500 square feet, but upon completion, it turns out to be 480 square feet, you cannot demand compensation based on the marketing materials. This applies to any statements made by sales representatives at the presentation centre as well.

To protect yourself:

• Carefully review the disclosure statement and final strata plan before signing.

• Work with a knowledgeable real estate agent and lawyer who will verify the details for accuracy.

Ugly Truth #2: The Size of Your Unit Can Change

Even if you review the strata plan and it confirms your unit should be 490 square feet, the final delivered unit size can still be different due to a variation clause in every pre-sale contract.

Most contracts allow developers to deliver a unit that is 3% to 11% smaller without any obligation to compensate you. On a 500-square-foot unit, this could mean receiving as little as 470 square feet. On the flip side, if your unit turns out to be larger, the developer cannot charge you extra for the additional square footage.

To avoid surprises:

• Always check the variation clause in your contract.

• Measure your unit upon completion and verify it against the final strata plan.

• Know that you have seven days to terminate a contract after receiving the final strata plan if the size variation is unacceptable.

Ugly Truth #3: Developers Can Change Prices at Any Time

Developers set their prices based on market demand and can increase them at any time. In hot markets, I’ve seen prices rise by $80,000 to $100,000 within just two weeks.

For example, a client once bought a unit for $570,000 on the 40th floor of a building in Surrey. I had previously secured the same unit four floors below for another client at $484,000—a nearly $90,000 difference in just a few weeks.

While this may seem unethical, developers are simply responding to demand. It’s your responsibility as a buyer to:

• Research market values and compare prices with recent sales.

• Work with an experienced presale specialist who tracks pricing changes.

• Ensure that the price you’re paying aligns with the potential future appraisal value at completion. If the market doesn’t appreciate enough, you may struggle to secure financing for the full amount.

Ugly Truth #4: Early Completion Can Be More Problematic Than Delays

Many buyers worry about project delays, but what’s even more dangerous is when a project completes earlier than expected.

Why? Because:

• You have to secure financing much sooner than planned.

• You lose out on an additional year (or more) of property appreciation.

• You may not have the funds ready for the down payment and mortgage qualification.

In 2024, we’ve seen projects completing six months to a year ahead of schedule, putting buyers in tough financial positions.

To mitigate this risk:

• Monitor the development permits and construction timeline.

• Plan for a 3-year completion window when investing in preconstruction.

• Work with an expert who tracks project progress and helps you prepare financially.

Protect Yourself & Work With the Right Experts

The key takeaway? Due diligence is everything. Preconstruction condos can be a great investment, but only if you understand the risks and take the right precautions.

Always work with an experienced presale-focused real estate agent who can guide you through the process, protect your interests, and ensure you make informed decisions. If you need help navigating preconstruction purchases in Vancouver or the Fraser Valley, I’d love to connect—reach out anytime!