What are the Key Considerations for Pre-Construction Property Contracts?

Important Considerations When Buying in Pre-construction (New Developments)

Embarking on the purchase of a property in pre-construction, also known as new developments, requires a thorough understanding of this unique process. Here are some key points to give you a clearer understanding:

What is a property in pre-construction?

A property in pre-construction is a real estate project that has not yet been built. Buyers acquire the property during the early stages, before construction is completed.

Also known as New Developments:

The term "new developments" is often used to refer to properties in pre-construction. These projects represent the creation of new communities, buildings, or residential complexes that are still in the planning or construction phase.

Advantages of buying in pre-construction:

1. Attractive Initial Price: Prices are typically lower in the early stages of the project.
2. Customization Options: Some developments allow customization of certain aspects of the property.
3. Appreciation Potential: The property could increase in value during the construction period.

Key conditions when buying in pre-construction:

1. Unilateral Contract: The developer sets the conditions, and the buyer cannot make changes.
2. Cancellation Period: Generally, the buyer can cancel the contract without penalties within the first 15 days.
3. Non-transferable: The property cannot be sold or transferred without the developer's authorization.
4. Payment Structure: The payment follows a standard format, with percentages at different stages of construction.
5. Contingency-Free Financing: If the loan is not approved at closing, the developer may retain funds paid up to that point.
6. Delivery Time: Typically, the property is delivered in 2 to 3 years from the start of the project.
7. Finishes: Finishing details vary, and the property may be delivered with certain basic elements.

Remember, buying in pre-construction can be an excellent opportunity, but it is crucial to understand and consider all conditions before committing. This article is informative and does not replace consultation with a certified specialist. Be sure to make informed and secure decisions for your investment!

Diana Perez

I am a Colombian,  technologist, and professional publicist,  I have studied tax preparation and notary service in the United States, I moved to Miami 22 years ago and I thank God every day for the opportunity of being here. 
I have enjoyed working in sales since a young age. After completing my studies, I decided to embark on establishing my own business which initially operated out of my home. But quickly, I found the need to move my business to a separate space as required by the demand growth.

As an entrepreneurial woman, I learned the value of dedication, hard work, consistency, transparency, respect, and care for my customers. 

I have been developing professionally in the Real Estate world for several years, an area that I am deeply passionate about, from residential to commercial property. We have a great team made up of lenders, title companies, credit repair, and myself. We will provide you with the best advice whether you are an investor, first-time, or second-time buyer. We will be your team and be there for you every day 24/7 while we strive to get you the best interest rates and programs that best suit your needs. Whether it is a new purchase, sale, rent, flipping, auctions, or more, we guarantee a professional and transparent service. Your satisfaction is our greatest reward. We want to be part of your dreams. Let us accompany you throughout the process.