Miami Preconstruction Condos - Miami Condo Lifestyle
Miami Preconstruction Condos
Miami preconstruction condos have received a tremendous amount of press coverage during the new second wave of preconstruction which started in 2012. Many staff writers for large papers with little or no personal experience in investing in real estate are predicting another bust...boo...hoo. The deposits required by the developres this time around and the speed with which these new projects are going under contract, essentially selling out and coming out of the ground contradicts the nay-sayers. To fully understand the opportunity in preconstruction projects in Miami and to avoid the pitfalls of the Miami real estate market, please read the following and then contact the REALTORS at the Miami Condo Lifestyle team of Vandenburg Properties at 305-321-7043. We will help you separate the wheat from the chaffe!
All of Miami-Dade county has been experiencing tremendous real estate development in every price range in the market. New construction projects, commonly referred to as "pre-construction condos" are rising in every community from Aventura to South Beach, Downtown Miami to North Bay Village, Brickell Avenue to Dadeland. There are many different types of buildings; ranging from two story lofts to 70 story waterfront high-rises...ocean front luxury condo-hotels to affordable suburban mid-rise projects. Whether you want an affordable studio apartment in the Miami Arts District or a penthouse mansion in the sky in Bal Harbour...no matter what price range, level of amenities and services, or location one desires...it can be found in Miami.
Miami Condo Lifestyle is dedicated to helping you sort through the hundreds of potential Miami preconstruction real estate opportunities to find just the right situation to fit your goals. To that end, we try to answer the Frequently Asked Questions here, as well as, describe the development phases that each preconstruction project goes through and the different ways to take advantage of the newly appreciating Miami real estate market.
The primary benefit of investing in preconstruction condo projects is that the buyer is able to get a brand new condominium property at some time in the future based on today's prices.
Each preconstruction condo project goes through four different phases:
Phase 1: Reservation
In this phase, the developer is offering the units at the lowest price of all future stages. These prices are typically below the market price and give the developer the chance to test the real demand for the project, helping the financing process that they face with their current lenders. The buyer will find the great chance to "reserve" the chosen unit with a deposit of 15% or 20% of the unit value, with a "reservation agreement". This money is fully refundable .
Phase 2: Contract
Once the developer reaches the point of the required number of reservation agreements, they create the "hard-contracts" with the "condominium-documents" specifying in detail all the legal and technical specifications of the development. This stage is usually reached between 1 and 3 months after the "reservation agreement". If the buyer wishes to go ahead, the deposit given to the developer is now non-returnable.
Phase 3: Construction
When the construction of the project begins or the construction "breaks ground"; a second 15 to 20% is required to complete the initial deposit. The construction may take between 6 months to 2 years. Once the developer finishes the buyers floor an additional 20 % will be required and also, when the building is "topped-off" or the top floor is completed.
Phase 4: Closing
Once the development interiors are completed (six months or two years later), you will complete the transaction by "closing" the unit. At this point, the remaining money to complete the purchase will be required, and the mortgage or the cash payoff will have to be available, along with the closing costs and all the typical expenses related to a Florida real estate transaction.
Preconstruction Condos - FAQ
How does Florida law protect the purchaser of a preconstruction condo?
In Florida, purchasers have a fifteen (15) day rescission period starting with their receipt of the Public Offering Statement, which includes the condominium documents, association by-laws, preconstruction purchase contract and escrow agreement; to review and complete or rescind any condominium purchase and escrow agreement and receive a full refund of their deposit if they rescind.
The most important protection under Florida law is that your deposit is held in an escrow account.
Finally, since all realty fees are paid by the developer, you are getting the services of the REALTOR® for free!
For more information on upcoming pre-construction projects and how to buy them, please contact us.