Pre-construction Condominiums | Homes | Commercial
If your investment focus is in Power of Sale, Distressed properties, bank owned properties, Foreclosures you are likely to be purchasing resale properties. Here are a few of the many benefits of investing in Pre-construction condominiums:
Builders will typically require a very small deposit to secure a contract for a newly built property. Upfront deposits can range from as little as 5% to as much as 30% of the purchase price with easy instalments. It is a major advantage for investors who prefer to minimize their out-of-pocket cash until the actual closing date.
This is true for both new construction and pre-construction real estate where the property is constructed after the acceptance of your purchase contract and deposit.
During real estate booms such as today where there is higher than normal demand for condominiums because for the first time “First Time Home Buyers” only get qualified for condominium suites. A small builder deposit allows some investors to profit by “flipping” or assigning their purchase contract to other investors for a fee or some times without any assignment fee. This only makes sense when the second investor is benefiting from the property’s equity through discounts and the appreciation during construction. The turn around for a condominium project to be completed is 2-4 years.
Growth and Emerging Markets
New construction can always be found in growth and emerging markets. As a real estate investor, this is where you want to invest to reduce your risk and maximize your long term appreciation. Although you could also invest in resale property in these same growth markets, you would be giving up the other benefits outlined in this article.
As always, be sure to do your research and study the markets you’re considering. Purchasing new property in areas where employment, shopping, and other important amenities are a long commute away may put you too far ahead of the curve and dampen your investments rental prospects.
More than one real estate expert has concluded that, as a whole, new construction properties tend to appreciate at a faster pace than their resale counterparts. As new developments see an increase in residents, retail establishment, schools, and other amenities quickly pop up to service the growing population. 2-4 years of construction project helps increase property values as more residents continue to move in to the area adding to the demand and establishing the community.
Discounts and Instant Equity
There are situations where purchasing new construction from a builder in the early stages of a development can provide you early bird pricing or significant discounts. It is not uncommon to purchase property from builder at 5% to as much as 20% below market value.
Why would the builder sell you property at a discount? One reason is to keep their sales up and debts low in order to be able to attract lender financing so they can build more property. Having buyers lined up to purchase the builder’s product reduces the lenders risk on loans they provide that builder.
Overall, newly constructed real estate is better suited as investment than resale condominiums. They are simply more energy-efficient, healthier, and lower maintenance. They can be purchased in growth markets using small upfront deposits and often at below market value. There are no surprises, and that translates into less worry and stress for you.
Some say, there are too many investors in the market today and the value of the real estate won’t go higher than what it is today.
Global economy may be fragile but, Canadian mortgage is stable. The number of foreign investors has increased so does the demand for shelter.
Affordability and Down Payments
Affordability is the key issue today. Most of the new comers to Canada have enough cash for huge down payment. For the first time, we are seeing huge down payment towards to purchase of a home. Therefore, there may not be a Real Estate bubble as some predict. When the price for Gold hit the market over $800 and the price of homes jumped to $400,000 in some places in early 2000’s. Some predicted that the price for homes will dropped. However the price of homes and the gold kept going up due to huge of number of immigrants.
Nobody can predict the future 100%, but the history tells us that this is time the perfect time to invest in Real Estate today. Canadian Population is growing so does the number of immigrants to Canada. They need a place to live and the Real Estate market will remain strong as long as there is demand.
The above information is for illustration only. You are recommended to do your own research and due diligent.
To get more information on this and the secretes of how Pre-construction project helps thousands of individuals to be financially independent, and more importantly how you can wisely invest in Real Estate. Please contact me, and I will take the time to help you every step of the way.
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It is true, but keep in mind investing in Real Estate is not a quick rich scheme. Let me explain! You are just a phone call away 416 879-6335 or e-mail: firstname.lastname@example.org.