*Don’t buy a condo without reading this post* Buying new construction is tricky, put an expert list of questions on your side. You’ll be thankful that you did!
1. How many units have sold in the building?
This is important because it can reveal the “momentum” of a project. Don’t buy into the explanation of units “under” contract; ask them for the recorded sales!
2. When do you expect to sell out?
Every good developer has a projected sales number. Builders that fail to sell, have failed to plan!
3. May I see the units that are not listed on the MLS?
It has been studied that at a given time, only 5-8% of the available inventory is every marketed on the mls. It is often not what you see, but what they hide! Pay attention and ask questions about their remaining inventory.
4. Do you have a price sheet that I can review?
When you tour a site you’ll often see the sales agents with a clip board. That is their price sheets. They keep these pretty close to the vest. However, it never hurts to ask. Ask them to see it. Why not right? It is said that you can’t get what you don’t ask for. Right?!?
5. Are there any owners that would be willing to share their experience here at the building thus far?
People love to talk about things they are proud of. Especially when it was a good deal, or great service was rendered. Ask the sales agent if they know of anyone who purchased who would love to share their experience. Ask for 3 people or more. That way you are getting an un-biased view and not just an opinion from a person that would say great things about the project regardless if they liked it or not.
6. Would you explain the warranties that are included with my purchase?
There are a number of different warranties that come with a purchase. State mandated, Building, Developer, appliance and many others. It is important for you to find out what warranties are covered by the developer. If you know everything ahead of time, it will be that much better when you go to have the work handled.
7. Are there any rules that restrict my ability to lease my unit.
Life can change quickly. Some of us get married, deal with financial hardship, have to relocate and the list goes on and on. You should always find out what your limitations are with renting. It can be a devastating mistake when you “need” to rent and the project won’t allow it. These types of rules and regulations are found in your public offering statement (new construction) or re-sale certificate (re-sale unit).
8. Has a Home Owners Association been assigned? Will the building be professionally managed?
There is a certain time that the HOA is formed and turned over to the owners of a building. Dues are instated and the developer takes a huge step back in terms of responsibility. Ask when the HOA will be formed (how many sales until it is turned over?). Also, make sure that building is managed by a professional management company.
9. Do I trust the sales agent?
I think one of the biggest mistakes made by buyers is they rush into a purchase without a qualified professional. We don’t work on our own teeth, cut our own hair or fly a airplane without the help of others; so why do we insist on handling such a big purchase on our own?!? Treat real estate like you would your other professional service. It will pay off in the long run. (see my opinion here)
10. Will I love where I live?
Ask to see a map of the location. Can you walk to a grocery store, movie theater, great restaurant or to buy your medical prescription? If you can’t, make sure what you are buying suites the other needs in your life. As cheesy as it sounds location, location, location is the most important mantras in real estate.
Overwhelmed? Don’t be. Just learn from the questions provided and apply them to your research when buying a home. You’ll thank me for it!
As always, if you have any questions, feel free to e-mail me at firstname.lastname@example.org