Pre-construction condos are an incredible buy irrespective of your reason for purchasing them. They can be solely for investment or even for living. Furthermore, it does not matter if you’re a first time buyer or an experienced buyer because pre-construction condos have certain risks that must be dealt with inevitably. It is essential to avoid this risk to make sure that your condo doesn’t become a liability in the future. Therefore, there are several things you should know before investing in an apartment. It is feasible that some changes occurred during construction such as the materials used. Knowing about such changes to prepare for the unforeseen is at all times a good thing.
A pre-construction condo is an incredible buy because it means you, the customer, have options for selecting the location in addition to the developer. However, the question arises as to what precisely buyers should pay attention to when investing in pre-construction condominiums. This article will answer these questions and also provide you with insight into how pre-construction condos work to make sure that your investment is a sound decision.
1. Research
Since you’ll be investing a considerable amount of your money in a condo, you should do thorough research to understand if the condo meets your needs. condition. Your precedence should be knowing about your builder by asking for reviews from your realtor. Another way to do this is to look for credible online reviews. Try to find out about their previous projects, the time they took to start construction, and if construction was completed before the occupancy date.
The main risk related to pre-construction condominiums is the cancellation of the project even before construction begins. It could be as a result of denial of building approvals or lower than anticipated sales and this is why you should at all times look for an experienced and respectable builder. This will reduce the likelihood of unexpected cancellations in the future.
2. Benefit from Cancellation
When you get 10 days to reconsider your post-purchase contract, several actions can be taken in your favor as the customer. First of all, you should choose a lawyer who specialises in real estate so you can review your agreement. As soon as you get the unit to your liking, register instantly and determine the price. If you jump into the project early then you can avoid problems such as rising prices, or in some cases, units becoming unavailable. Make sure your account has enough funds before the due date because forgetting it will mean you must pay NSF fees.
3. Construction Delays
Construction delays often occur for a number of reasons including weather, strikes, and problems with the materials supply chain. Therefore, it’s advisable to anticipate a delay of about 8 months from the date of occupancy. The best idea is to visit the construction site periodically to record progress and keep asking about the progress of the project.
4. Moving on
Whether you want to rent a condo or move out, you can do so even before final closing. This means that even if the condo hasn’t been transferred in your name, you can still get the keys. By this time, the completion of the building is generally complete and the mandatory requirements with regard to all inspections have been passed. During temporary residence period, you make mortgage payments on behalf of occupancy or rent but the mortgage begins after final closing. Please note that you’ll not be capable to access the building amenities, including lifts and hallways during this period.
5. Last Minute Changes
Investing in a pre-construction condo means the builder has the right to make changes to the building materials, facilities and floor plans. In such cases, builders generally notify their clients about updates. Therefore, it is feasible that you may get a different condo than the one you initially listed.
6. Higher Maintenance Costs
Since your condo construction may not be complete, the monthly maintenance fee is just an estimate by the builder. Furthermore, changes in the inflation rate can even change costs. So when you compare different condos based on maintenance costs, do not be lured in by the low costs – they have a tendency to add up over time. It’s also important to actually look into details like where the property is located and what the general climate is like, as these will have an effect on the amount of maintenance required. For example, if you’re attempting to find a property in Miami with a view of the bay, it is necessary that you deal with a reputed construction company. Many have invested in Aria on the Bay condo have found that management takes it upon themselves to make sure that maintenance is a precedence. This means that understanding in detail what maintenance costs cover makes a big difference before you make any investment commitments.
Investing in pre-construction condos can be an incredible idea, considering the low costs. However, there are specific factors that you should remember of in advance, including the builder’s reputation, cancellation period, construction delays, material changes, and increased maintenance costs. This has been discussed in detail in this article, but it’s best to consult your real estate lawyer before making any purchases.
