Why Buy a Pre-Construction Condominium?

Buying a pre-construction condo is a smart move for many reasons. It helps you avoid many common problems associated with new construction, like construction delays, expensive maintenance, and legal protections. It can also bring you an income while you wait for the new building to be completed.

Construction delays

• Purchasing a pre-construction condominium can be an exciting opportunity, but it also comes with a few risks. There are plenty of construction delays that can affect your purchase. These delays can be very costly, and you should be prepared for them.

• If your Pre-Construction Condos are delayed, you may be able to receive compensation. However, you should be wary of claims that are too high or unrealistic. Your condo may not be ready when you arrive, or you may have to move out and find a new place.

• The average delay for a condominium project is three to eight months from the date when it is marketed as being ready for occupancy. However, there are instances where delays are more than six months.

• There are many causes of delays, including weather, personal disputes, contractor disputes, strikes, and more. The main culprits are permitting and start delays.

Maintenance costs

• Generally speaking, maintenance costs of a pre-construction condominium vary from unit to unit and building to building. This is because of the amount of maintenance required to run a building.

• Typically, these costs are divided among the owners of the units. These costs include salaries of building staff, building supplies, licenses, and insurance policies. Additionally, the building may need to dip into its capital reserve fund to pay for major repairs. The amount of money needed is based on a number of factors, including the number of units, the age of the building, and the amenities offered.

• For example, older buildings typically have more repair reserves than newer ones. These repairs may include elevator repairs or a facade restoration. Similarly, one-time expenses such as new carpeting and siding may be levied against the monthly maintenance fee.

Rental income

• Buying a pre-construction condominium can provide a substantial gain in your real estate investment portfolio. However, there are several factors to consider before jumping into the investment pool.

• The best way to find out whether or not your investment will pay off is to look at the numbers. To do this, look at the cost estimates for the condo and the local real estate market.

• If you are considering buying a condo for rental purposes, you should know the importance of the proper lease. The proper lease will include rules and regulations. This includes a security deposit that can be as large as the number of months' rent. It may also include a rider that replaces your rental income in case the property is damaged or destroyed.

Legal protections

• Buying a pre-construction condo has its fair share of pitfalls. There are a variety of legal protections that can shield buyers from some of the hazards of owning a new condo. A real estate lawyer can provide legal advice and assistance with complex contracts and documents.

• The best way to protect yourself is to make sure you are buying from a reputable builder. Some builders make their contracts available online. It is a good idea to request regulations from the condo association before purchasing. Some association regulations will restrict owners from making exterior and interior modifications. Some regulations will limit parking large RVs and boats.

• In addition to the usual hazard warnings, buyers should also be on the lookout for the minor details. These include the oh-so-common wooden floors, which may be warped. A walk-through sheet may highlight some minor issues, which should be addressed after closing.

Common reasons for project cancellations

• Buying a pre-construction condominium is a major investment, and it is essential to educate yourself about the risks involved. You should also ensure that you have a legal representative who is experienced in pre-construction condominium transactions.

• In some cases, the builder will have to cancel the project. These can be for a variety of reasons. Some common reasons include failure to obtain development approvals, insufficient sales, and lack of funding. There are also good reasons for the project to be cancelled.

• When buying a pre-construction condominium, you should be aware that you have the right to cancel your purchase within 10 days. This is called the "Purchaser's Termination Period". You may be able to get a refund for all the costs incurred, including the contract deposit. If you can't obtain a refund, you may file a complaint with a court. You may also ask for an order requiring the vendor to compensate you for any damages.