Florida Real Estate Investment
Florida Real Estate Investing
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© 2004-2008 www. Miami New Construction Guide .com. All Rights Reserved
This article will
address important issues such as:
The forces driving Pre-construction Prices and is it likely to continue?
Tips on Buying Construction pre-construction? Part 1
or skip to How Not to buy pre-construction? Part 2 (click )
Employment: Home building adds jobs in Florida - Florida continues to be among the top spots for job growth, with home construction generating a robust demand for workers. Florida's galloping economy has generated one-fifth of all new jobs in the country since 2001. (Miami Herald)
Buying South Florida Condo Pre-construction
** "Buy now and Pay later" is the main
attraction for savy investors that are taking advantage of that explosive
market such as Miami, Fort Lauderdale, West Palm Beach & Fort
Myers. Andrew James, Realtor@, Pre-construction Investor
Buying Pre-construction Miami Condo Pre-construction to Palm Beach Condo pre-construction in South East Florida ?
The first step to buying in Pre-construction in South Florida is to get familiar with the different areas and what they offer. In each area we cover, you'll find the information you need on its web page.
You're
buying before the construction of a property (home or condo) begins. Typically,
buyers at this stage get discounted price compared to the price you buy when the
building is constructed. When a developer is about to build a
project, he would present the project to key brokerages. Then key
brokerages (assuming they like the project), they present them to their
customers. Key brokerages are the brokerages that developed good
relationships with the developer. For instance, our team just won an award
for Trump Sales as the #1 top producer for sales in the International Condo Hotel
project in South Florida. So, there is a mutual appreciation between the
two teams which can benefit our clients. This is where you get
what's referred to as VIP pricing (first phase). However,
the market has been very strong, that almost every month we're seeing
appreciation in prices. At this stage, the key brokerage clients can
reserve a unit for a small refundable deposit.
Sometime later, the developer convert these reservations
into contracts (binding contracts). At the contract stage, the developer
would require 10% down payment.
Pre-construction Condo
vs. Pre-construction Home , Miami
Condo Pre-construction to Palm Beach Condo Pre-construction in South East
Florida
Miami Condo pre-construction
sales have been setting new records for the last 8 quarters. Condos pre-construction
Sales are hot in Southeast Florida.
Pre-construction Investing , Miami Condo Pre-construction to Palm Beach Condo Pre-construction in South East Florida
Typically, a minimal refundable deposit will secure a reservation in the initial stages of pre-construction.
When a buyer decides to proceed forward, the remainder of a percentage of the purchase price, normally 10% - is due to bind the contract.
After construction begins, developers often schedule incremental price increases with the release of each new phase.
With buyers aware of increasing prices, demand tends to increase dramatically, which in turn lends itself to maximum appreciation opportunities.
Probable build out time ranges from 12-24 months, which affords buyers huge potential benefits in rising appreciation, and tremendous savings when purchasing early in the process.
You do not need to qualify for a mortgage. There are no financial Contingencies in the contract. The hope is to capture on appreciation as the market goes up without having to pay (carrying costs) mortgages, taxes, interest and the other expenses that you deal with if you own typical real estate investment. This has been the dream of many real estate investors in the past that had been burned out dealing with difficult tenants, finding tenants, increased property taxes and the many issues you face when you start investing in real estate.
How much cash do you need?
Buying and
investing in Miami Condo Pre-construction to Palm Beach Condo pre-construction
in South East Florida
Condo developers are flexible and do not have many restrictions.
This is why you'll find the site focus on Condos instead of homes.
However, there are very few developments (in the areas that we serve) that
offer units below 250K and most require down payment. Also, we found
units below 250K did not present reasonable risk to reward ratio. This is
due to the fact that competition is very strong since there are more investors
entering this market.
I only deal with large, reputable developers and the majority require down payments ( 10% with contract, then another 10% later) but some might require only 10% of the purchase price. PAYMENT HAS TO BE IN CASH (not a letter of credit). It means if you're buying 300K condo, you need 30K cash with your contract. Developers do not take credit cards.
pre-construction
in Miami to Palm Beach in South East Florida
One Investment Example: high returns and limited risks
Lets consider a $400K condo reserved pre-construction. Closing
is due in 2 years.
-Initial investment is $40K (10% of Pre-construction value) with contract
signing.
-additional investment is $40K (10% of Pre-construction value) at ground
breaking typically 3 to 9 months later.
-Considering a conservative appreciation per year for a new building (our
market has been averaging between 24% to 30% annually), the value of property
will be 480K, your equity(gain) will be 80K (480k -400k) which in this case 100%
return on investment in the first year. By the time the project completes,
the property value will be close to 600K.
There was no carrying costs (mortgage, taxes, management fees....).
Developers do not qualify Pre-construction buyers. So, your credit
history, income, monthly expenses...are not considered. As long as you
have cash they will sell you pre-construction.
The risk: this is a cash contract, which means at time of closing, if you do not
close on the unit, you'll lose your deposit.
I hope you can see why this is attracting smart money and delivering high
returns with no effort required except wiring money to an escrow account where
your money is protected.
Some developers will allow to flip (assign) your contract before you need to
close on the unit.
In
a fast market like south Florida market, you need to be ready to take
action when the right opportunity presents itself.
pre-construction
investment risks in Miami to Palm Beach in South East Florida
** I have a complete article on "Risk
Management in South Florida pre-construction
" which I will be publishing very soon. So, watch for it or email
me to notify you when its ready. If you read about
me, you'll see my background is in engineering where I
used to run my consulting business for fortune 100 companies.
However, I spent several years actively day trading stocks, options, and
drivatives where I learned risk management strategies that are a must to
survive. Now, I apply the same principals to either long term investing or
short term speculations in the South Florida pre-construction
market. Capital preservation is my number one priorty in any investment.
Read How
Not to buy pre-construction?
Part 2 (click ) or
Read
our testimonials.
This dynamic report has just been released to help protect Pre-construction investors.
Here are some of the items that you'll find in the report:
pre-construction How to calculate the cash you need and time table?
pre-construction How to calculate your return?
pre-construction How to limit your risk?
pre-construction How (and more important when) to Sell (Flip)?
pre-construction Costly mistakes and how to avoid them?
pre-construction - FINAL CHECK LIST (GO/ NO GO DECISION)?
Typically, only clients receive a copy of this reports. However, to help new investors and Pre-construction buyers, we'll email this report to serious investors that are about to purchase and would like assistance. email me and I will email it shortly. Only completed requests will receive the report. Thanks.
Our clients that we present to purchase Pre-construction get a complete package and an extensive informational phone call with Andrew where he reviews the whole process and guide the client step-by-step on where they can find the investment opportunity to meet their investment objectives in the time frame they desire. If you're either a conservative investor or a speculator, the successful investor (for the long term) will be the one able to manage his/her risk. In every page on this site will attempt to help you to learn about the exciting market areas and to assess the risk vs. the reward.
I
understand you're doing your research on the internet which you should.
However, sometimes doing it on our own can be good for our ego but painful
to our pockets. We can help you, it will make a big difference and
you can sleep better at night knowing someone you trust watching over your
investment.
We'll advice you when you buy, our service is free, consult you
when it's time to sell and we'll even sell it for you at a discount so you keep
more of your profit. Remember, you make money when you sell. This report
is made available to our clients as one additional benefit of working with
Andrew James Home Buying Team.
New or
existing clients that about to purchase new condo or home and using our
services
will receive this report to help them locate the right opportunity with the
highest potential for appreciation and limited risk. If you want to use
our free service to help you with your home search and to receive this
report, please click
here
and complete 4 questions form and we'll contact you ASAP. At
this time, because of the volume of emails we receive, we can not respond to
requests without valid phone numbers. Your information is kept confidential
(read our privacy statement). We hate spam as much as you do. There
is no obligation or cost to you. Thanks.
To start your search for Pre-construction condos, get familiar with the different areas in Miami , Fort Lauderdale or Palm Beach. We included introduction to major areas such as Aventura Miami Pre-construction , Bal Harbour Miami Pre-construction, Brickell Miami Pre-construction , Miami Beach Pre-construction, Miami fowntown Pre-construction , Biscayne Miami Pre-construction, South Beach Miami Pre-construction , Miami Sunny Isles Beach Pre-construction , Surfside Miami Pre-construction , Trump Miami Pre-construction , Miami design district Pre-construction, Fort Lauderdale New Real Estate, Palm Beach Pre-construction, Delray Beach Pre-construction , Boynton pre-construction.
© 2005 www. Miami New Consrtruction Guide .com. All Rights Reserved
all articles and images are copy righted. Violation of copy rights is 250K.
South
Florida Real Estate Condo Miami Pre-construction, Fort Lauderdale
Pre-construction to Palm Beach Pre-construction Andrew James
