Do you pay the same price in lower and higher floor?
Do I pay the same price for higher or lower floor?
This is the kind of question that potential buyers and those who are in the process of choosing a unit are asking. Indeed, it is very important to take into account all the parameters when you want to purchase a unit: geographical location, price, floor, design, etc.
So do you pay the same price for two units located in two different floors?
The simple answer is: no.
Many think of purchasing a new unit, hoping that the prices would be the same for all the units in the same building, but unfortunately it is not the case. You need to take into account the floor where your desired unit is.
Actually, the higher you go in floors, the more expensive you will pay for the purchase of a unit. Most of the time, the price difference per floor is a fixed amount.
This fixed difference is called “premium”. This premium may vary according to the constructor, and it could go from $750 up to $2,500 per floor.
Most builders tend to set this premium at $1,000 per floor. It may be two same units with the same design, but if they are in two different floors, their price will surely not be the same.
And sometimes, some units are booked before others, and a unit in a floor may be reserved quicker than another one in another floor. Units in higher floors are quicker taken than those in lower ones, and there is a reason for that. But the purchase process is the same. You can quickly click here to check for the newest units available and be the first to book your desired unit.
Let’s get to numbers
Here is a simple illustration to help you understand the price increment according to the floor where the unit is. Let us take an example of a premium set at $1,000 per floor and see the price difference between a unit in the 3rd floor and another on in the 26th floor.
Let’s say that the one in the 3rd floor costs $205,000. Let us calculate how much the one in the 26th floor will cost.
The one in the 26th floor will cost $228,000 (see below the details of the calculation). It is very simple and not a rocket science.
So, we counted we have 23 floors of difference and our premium is $1,000 per floor. We then added $23,000 (which is 23 floors x $1,000/floor) to $205,000 and we got $228,000 as the price for the unit that is in the 26th floor.
You can see that this unit in the 26th floor is way more expensive than the one in the 3rd floor. Be it an investment of a simple purchase, we need to take this parameter into account. You must find a way to maximize the use of the unit, for it to be profitable if you purchase it for an investment purpose.
The reason why the units in higher floors are more expensive than others is because the ones in higher floors have a better resale value than others in lower ones. So the premium you’re paying today will still repay in the future. So the choice is yours to make.
Any questions regarding a condo purchase?
Feel free to contact us here should you need further details or more explanation. We will be pleased to assist you and we suggest a large choice of condos that meet different needs.