When potential home buyers are searching for condominiums they typically look in the local real estate sale magazines and on websites for any that are available in their target communities. This can you yield great options on existing condominiums that can be purchased and moved into after an escrow period. The new home buyers will walk through the property and examine the condominium, scrutinizing every small detail about it and the community in which is located. In fact the majority of condominiums are purchase this way.
Condominiums are also purchased during pre-construction. In this instance there is only a set of models that potential home buyers can peruse, and a drawing or miniature model of the actual condominium property that is to be built. A potential homeowner can find pre-construction condos online or through local marketing, but that person must be prepared to wait for up to one year before the condominium property is built and their unit is ready to be occupied.
Although both options for purchasing a condominium has pros and cons, for perhaps the majority of potential condominium purchasers, buying a pre-construction condominium is worth the wait. Here are a few reasons why:
You can secure the property with only a small down payment
If you choose to purchase a pre-construction condominium, you will only be required to put a very small deposit to reserve the condominium. This deposit is often a fee rather than a percentage of the cost of the condo. During the construction of the condominium and at its completion you will be required to pay percentages towards your condo’s down payment. This approach allows you to keep more money in your pocket now, while the condo is being constructed. This money can be used for other things during that time like going on a great vacation.
You can save money
If you purchase a condo doing a pre-construction period, you’ll be given a discount on the market value of the completed condominium. Developers use a discounted value as an incentive for homeowners to purchase a condominium sooner. The earlier you purchase the condominium, the better the price that you will get. In some cases, the price you will pay is 20% off the market value of a completed version of the condominium.
Depending on the marketplace in which you are purchasing the condominium, and the amount of time it will take for the condominium to be built, you might find yourself in a position where the value of your condominium has gone up even more. In other words, during the time spent, you will be making money.
You can sell before it is ready and make a good profit
Many real estate investors purchase pre=construction condominiums because they can be a great way to make a profit. Because they are sold at below-market prices, and the amount to secure these units is low, real estate investors will often purchase these units and sell them before they are completed.
Condominiums try to limit the amount of investors who can do this because it can cause some panic for other purchasers and those looking to buy a pre-construction condominium in that development. If this is your plan, you should discuss it with the developer in order to make sure that you can in fact sell your unit in advance of it being built.
You can pick all of your furnishings
One very attractive element of purchasing a pre-construction condominium is that you get to pick the exact materials and appliances that will be in your unit. You choose everything from the color of the walls, to the types of toilets, with no concern about needing any upgrades to the infrastructure of the condominium or your particular unit to accommodate your desires. This allows you to have the exact home that you want with no compromises.
Making a smart purchase of a pre-construction condominium requires that you understand the guidelines of a particular condominium development, and that you are clear about your intentions for making the purchase. In the end, this can be the smartest way for you to purchase a condominium.