Off-plan or pre-construction properties go through different stages. As construction progresses, prices tend to increase, as do deposits. However, not all promotions have the same structure and many have incentives or attractions during different phases of construction. Here are some of the things to keep in mind when considering a pre-construction purchase:
Price Increase: As construction progresses, prices typically increase. This is due to increasing unit shortages as well as rising material and labor costs.
Deposits: Deposits also increase as construction progresses. The initial deposit is usually lower than subsequent deposits, so it is important to be aware of how much you will need to deposit at each stage.
Incentives – Many developers offer incentives to buyers who purchase during the early phases of construction. They may include discounts, free upgrades, or other perks.
Completion Date: Although developers aim to complete projects on time, delays often occur due to weather, material shortages, or other factors. It is important to be aware that the end date may be subject to change.
Here are some terms you should know before buying pre-construction:
Unilateral Contract: The Developer (Developer) is the one who writes the contract and establishes all the rules, the buyer has no right to make any changes.
Cancellation period: Within this period (15 days from the signing of the contract), the buyer has the right (according to Florida law) to cancel the contract if he does not agree with any of the clauses of the contract, without any penalty.
It is not transferable: The contract is made in the name of the buyer or in the name of a company where this buyer is 100% owner. The property cannot be sold or transferred to a third person before the work is finished and the title deed executed, unless you have the consent of the Developer.
Some payment methods:
This is a payment standard that is followed in most projects, this may be different in some developments:
10% upon signing the contract
10% between 60 -90 days after the first deposit
10% at the beginning of construction
20% halfway through the construction of the building (30th floor if it has 60 floors)
50% the day of the deed of the property (closing day)
Financing without contingency: If for the final payment of the project the buyer requested a loan and it is not granted at the time of closing, and he does not have the cash, the developer has the right to keep the total money delivered to date. In practice the Developer suggests different lenders to facilitate this process.
Breach of contract by the Developer: If there is a breach by the Developer (Developer), it must notify the buyers in writing, having a period of 7 days to solve it, if not fulfilled, the buyers would be fully entitled to claim your deposit with interest.
Delivery time: It can be from 2 to 3 years if the purchase contract is signed at the beginning of the project, this time can be less depending on the stage of the project at the time of purchase. The delivery time is also influenced by the finishes with which the units are delivered.
Finishes: It is important to ensure the delivery conditions as this significantly influences the final investment; however, the standard in South Florida is for projects to be delivered, like this:
Equipped with household appliances
Equipped with kitchen cabinets
Full bathrooms with and without floors.
