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| RuthAnn McBride |
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Buying Florida Preconstruction
Buying at pre-construction prices equals potential profit!
Buying Florida pre-construction is an easy way to enjoy potentially substantial profits. When a developer designs a new development, one of the best means by which they may secure their construction loan is by offering pre-construction sales. These sales are generally lower priced than post construction sales in order to attract buyers/investors. Once the developer has secured financing, construction begins and units are then offered at a higher, post construction price, as set by the developer. Once constructed, Buyers/investors who purchased during the pre-construction phase may now place their unit(s) on the market for resale and enjoy substantial appreciation. Although never guaranteed, these profits can be remarkable. In March of 2004 a client of mine reserved a single family home during the pre-construction phase for $235,000 which he now has listed for $485,000. Patience and planning truly pays off when it comes to buying pre-construction. It all boils down to supply and demand. In SW Florida, the demand for waterfront communities or those properties with water access is extremely high. Those desiring a vacation get away may be in the market for condos or villas. These are very attractive to all age groups. Since the pre-construction phase is limited to a specific number of properties and only available for a specified amount of time, time is of the essence. Generally when you place a reservation on a property, you are required to pay 10% of the purchase price. You have the option of continuing with the purchase once the developer is ready to begin selling the properties or, if you have changed your mind you may elect to cancel you purchase at which point your reservation fee will be refunded to you. So, as you can see, you have nothing to loose and potentially much to gain. Your purchase will now remain on hold until the development is complete at which time closing will occur and you must pay the balance of your purchase either in the form or a mortgage or by paying cash. Once the development goes on the market for sale to the public, your may place your property for sale at the current market price - as set by the developer. As you can see, buying pre-construction is a good means by which you may increase your real estate portfolio and enjoy substantial profits.
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Ruthann McBride, ABR, is a member of the RE/MAX Hall of Fame. She is a licensed Florida realtor whose sole intent is to provide information concerning the purchase of Florida real estate and is not to be construed as giving investment, legal or accounting advice. Only professionals in these fields are qualified to provide counseling regarding these areas. |
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