Pre-Construction Condos: What You Need to Know
A Pre-Construction Condo Is Exactly What It Sounds Like: It’s a Condo That Has Yet to Be Built
Introduction
A pre-construction condo is a condominium that has yet to be built, offering buyers the opportunity to customize their unit during early development stages. Developers sell these units early to finance projects, which may range from conceptual plans to approved designs with available floorplans.
The Advantages of Buying Pre-Construction
Price
Developers often offer pre-construction condos at lower prices to generate demand. Prices typically rise as construction progresses, making early purchases more cost-effective than buying existing/resale units.
New, New, New!
Everything in a pre-construction condo is brand new, from appliances to flooring and HVAC systems. Most developers also provide warranties lasting 1–7 years post move-in.
Choice
Early buyers enjoy greater customization options, including unit location, square footage, floorplans, and finishes. As one Miami real estate broker notes:
“Signing early typically allows you to get the deepest discounts that the developer will offer, often referred to as ‘first tier pricing’. Deposit requirements are low, and you have the ability to cancel without penalty during the earliest stage of development. You will also have a wider selection of units when you get involved early.”
Location
Pre-construction developments are often in high-demand areas. Buyers should research the neighborhood and future development plans before committing.
Possible Disadvantages of Buying Pre-Construction
It’s Not Built Yet
Buyers must rely on conceptual plans, which may change during construction. Those unable to visualize unfinished projects may prefer waiting.
All the Usual Condo Fees Apply
Buyers must pay maintenance fees, homeowners association fees, and potential fee increases over time—similar to existing condos.
You’ll Need 20% Down
Developers typically require a 20% down payment, often paid in installments. Funds remain tied up during construction, with limited refund options if buyers change their minds.
Completion Dates
Construction delays are common. Buyers should confirm timelines with developers but remain flexible.
Advice to Follow When Shopping for a Pre-Construction Condo
Research the Developer
Review the developer’s past projects for construction quality, timelines, and responsiveness to issues.
Research Comparables
Compare prices of similar new and existing condos based on square footage, amenities, and location to assess value.
Conclusion
Pre-construction condos offer unique benefits for buyers willing to navigate uncertainties. By researching developers, pricing, and timelines, buyers can secure a modern home at a competitive price.
