Jun 22, 2026 · 26 min · 10 segments
We want to hear from you! Drop us a message 🙏🏼 On this episode, Matt and Maryanne discuss what happens when pre-construction deals close and why…
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Matthew AblicanHost
Maryanne StilloHost
So pre-construction deals, why are they not closing? What's happening in the market? I've had some people that have not closed their deals, Mir, and there's a lot of backlash builders are facing.

There's a lot of backlash maybe the government's facing for not doing certain things to prop up the market.

But I can tell you right now, one of the biggest reasons that deals are not closing, I don't know if you're going to get to this in your portion, Marianne, but is appraisals.

Appraised values are not coming in at the values we need to close these deals.

So what I mean by that is, as an example, somebody bought something four years ago for $500,000.

And unfortunately, when they're trying to get a mortgage, there's an appraiser that's involved that the bank sends out to put a value on the property.

So now what happens in that case, the buyer has to come up with a difference.

And by the way, $100,000, it's a lot of money, but that's like on the low end for what some people are seeing, the appraised value versus what they paid for.

I'm hearing some property values have dropped 500,000, 600,000 compared to what they bought it for, especially those really expensive downtown Toronto condos.

Well, and I think too, like In the beginning, when you go in to purchase this pre-construction, you're like super excited.

So you get so excited, you have a little bit of money, you want to put it down.

But the reality is, is that from the time that you make the purchase to it actually being built and completed and ready to go is like quite a few years in between.

So there's a lot of different factors that play into all of this along with the appraisal of the property.

See, I never understood realtors who would say, oh, just buy pre-construction real estate and you're going to make money.

So pre-construction deals, why are they not closing? What's happening in the market? I've had some people that have not closed their deals, Mir, and there's a lot of backlash builders are facing.

There's a lot of backlash maybe the government's facing for not doing certain things to prop up the market.

But I can tell you right now, one of the biggest reasons that deals are not closing, I don't know if you're going to get to this in your portion, Marianne, but is appraisals.

Appraised values are not coming in at the values we need to close these deals.

So what I mean by that is, as an example, somebody bought something four years ago for $500,000.

And unfortunately, when they're trying to get a mortgage, there's an appraiser that's involved that the bank sends out to put a value on the property.

So now what happens in that case, the buyer has to come up with a difference.

And by the way, $100,000, it's a lot of money, but that's like on the low end for what some people are seeing, the appraised value versus what they paid for.

I'm hearing some property values have dropped 500,000, 600,000 compared to what they bought it for, especially those really expensive downtown Toronto condos.

Well, and I think too, like In the beginning, when you go in to purchase this pre-construction, you're like super excited.

So you get so excited, you have a little bit of money, you want to put it down.

But the reality is, is that from the time that you make the purchase to it actually being built and completed and ready to go is like quite a few years in between.

So there's a lot of different factors that play into all of this along with the appraisal of the property.

See, I never understood realtors who would say, oh, just buy pre-construction real estate and you're going to make money.
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