Purchasing a condo in the pre-construction period might seem a little too hasty. In that scenario, it would seem the unit is being purchased based on the architectural drawings from the developer’s sales site. The reality, however, is that buying a team before construction is finished isn’t all that straightforward.
Developers tend to rework a unit’s layout designs as the job progresses. This is a necessity given the many changes that happen during construction. Purchase contracts are drafted to be advantageous. For instance, a late complex completion will force delays onto the purchaser. They may even be put into the position of occupying their unit while the proper permits are still being worked out, as well as certain aspects of the construction itself.
Buyers might also be victimized by developers attempting to sell off units in an early stage and still in possession of over 51 percent of the condominium project. As time passes, developers may find themselves unable to sell off the remaining units.
A condominium that can’t attract new buyers will likely experience a significant decline in the overall value of its units. After realizing there isn’t any considerable demand, developers will decide to rent out any team that has gone unsold. The overall unit value then drops even lower.
It is advised that buyers consult with an experienced lawyer to insert their conditions into any purchasing contract. By determining a fixed completion date, the buyer can ensure they’ll get their deposits back if a developer gives an inaccurate estimate of time. These arrangements can even help protect the existing value of previously sold units.
The timing of the completion needs to be in the buyer’s hands. It is highly suggested that the proceeds from the sale of a unit and its deed remain in escrow under the guidance of the developer’s lawyer. Should this case only once, the developer has sold as much as 51 percent of their units. Whoever purchases the team will have to pay occupancy fees to the developer, equal to that of a combination of the monthly maintenance fees and the anticipated mortgage, as long as their agreement goes as planned. Many developers will try to push these without sticking to the terms you’ve laid out, so be mindful of how your dealings with them proceed.
You must also keep the condo maintenance fees in mind. They are guaranteed only for the first year of operation after the unit owners take charge of the complex. Developers tend to calculate an initial budget based on the lower end to make the condominiums appeal to more buyers.
As the years go on, most unit owners will assume control of a complex. It’s almost as if it’s a rule. Afterward, they are hit with a notably higher monthly maintenance fee meant to take care of the developer’s overrun costs. From the first year, buyers will take on and expect increased maintenance fees. Naturally, this comes after the completion of the condo.