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Pre-construction condos are typically more expensive than resale condos, but they offer some unique features that may be appealing to buyers. With pre-construction condos, buyers have the opportunity to take possession of their units before construction begins, which can speed up the process. Additionally, pre-construction condos often come with a number of amenities that are not available in resale condos.
What exactly are condos and condominiums?
A condo is a unique living unit located inside a complex of apartments. It is a type of legal ownership, not a construction style, in which the owner normally just owns the condo's inside. Condos are corporations whose common areas, such as elevators and corridors, are held by all condo members but whose individual apartments are individually owned.
Why Do Investors Find Condos Interesting?
Condos can be the best option for you if shoveling snow or maintaining the grass aren't your thing. Owners who pay a monthly maintenance charge have access to on-site facilities like security measures and fewer maintenance duties. Investors don't need to take out a new mortgage because condos come in a variety of sizes and pricing points. Instead, they can use their equity. You can get in touch with our skilled realtors at Save Max and have the best knowledge of condominiums at your disposal.
Pre-Constructed Apartments
New condos that are being planned, built, or just finished are referred to as "pre-construction condominiums" and are typically purchased through a developer. The main benefit of purchasing a pre-construction condo while it is still being built is that it is less expensive than a condo that has already been sold. Investors purchase real estate when it is still underdeveloped and the value is most likely to increase. Although there is no assurance that the market will keep growing while building is taking place, profits might be very lucrative. Investing in a condo that is still under construction gives you plenty of time to organize your finances and preferences because there is a 2 to 4 year waiting period before ownership. These additional benefits are listed below:
- A condo that is still under construction enables you to enter the real estate market at a lesser cost. The down payment (20% of the total cost) can frequently be paid over a period of 2-4 years in smaller installments of 5% or 2.5% annually.
- Until the project is finished, no maintenance fees, mortgage payments, or property taxes are due.
- As the initial owner, you have the opportunity to personalize your home's interior design, including the furnishings, appliances, and floor plans. Because they can make all the improvements themselves, many homebuyers favor brand-new apartments.
However, purchasing a condo when construction starts can be dangerous because you are purchasing an unfinished building and will not receive the keys right immediately. It can take anything between a year and four years from the time you purchase a home until you move in, and it's impossible to predict how long the closing might be delayed. Additionally, there is no chance of earning money from rentals.
Although the condo's interiors can be customized, if you want to flip it, you'll need the builder's approval, especially if it's being sold on assignment. Inexperienced buyers might not be ready for the fees associated with the process because it is frequently difficult to forecast what the potential future value would be.
Used condominiums
Repossessed apartments are referred to as "resale condominiums". A resale condo in a desirable location is an excellent choice if you want to purchase a tiny house as an investment. With an immediate return on investment, these condos give purchasers the option to move into or rent out their property right away. The following are some additional advantages of purchasing a condo that has already been lived in.
- Flipping a resale home is simpler because the builder's consent is not necessary.
- The buyer of a resale unit benefits from knowing exactly what they are purchasing, how much space they will have, the layout, and the facilities offered.
- There aren't any protracted waiting periods before you can move in, and you also have the benefit of touring the condo complex.
- The absence of "notorious, pestering landlords" is the major selling aspect.
On the other hand, as soon as the sale is finalized, the buyer will begin covering the condo's maintenance costs. Additionally, unforeseen costs may occasionally arise as a result of special assessments, significant repairs, and renewal projects. Additionally, because resale apartments are only accessible in older buildings, it may be essential to conduct a technical audit (an assessment of the entire building) and/or a reserve fund study to assess the state of the building and common areas.
We have a brief, educational YouTube video that outlines the benefits of both pre-construction and resale condos and includes our suggestions. You can view it here to gain a better understanding of your choices.
Which is the wiser choice?
The real estate market is always shifting, and every investor has different requirements. Read our blog for first-time house buyers if you're considering making the purchase and get aware of the potential dangers. In addition to the price range, there are many more decisions you must make when purchasing a home, whether it is under construction or has already been sold. The simplest course of action is to discuss the advantages and disadvantages with your real estate and mortgage experts. Contact our knowledgeable staff at Save Max once you are certain that condo living matches your lifestyle and budget to receive the finest guidance.
Which is a better bet? does not have a straightforward answer. You can hunt for a suitable resale condo if you have adequate cash for the total down payment. However, if you want to save money and are prepared to wait, you should pick a property that is under construction so that you can pay the down payment in various installments over a number of years. Additionally, a pre-construction home with the most recent architectural design trends will sell for more money when sold under assignment.
The main benefit of a pre-construction condo over a resale condo, whether you're a prospective homeowner or an investor, is that it ensures the investor both a custom house and a long-term promised return on investment, at a substantially lower cost.
Conclusion
In conclusion, before you build your first condo, it's important to compare pre-construction condos vs. resale condos. Pre-construction condos are typically cheaper, but they may not have the same features as a resale condo.
