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As a rule, we're advocates of taking most real estate market reports with a grain of salt. But one noteworthy data point from this week's onslaught of numbers caught our eye: according to Bond New York's report on the fourth quarter of 2014, since September, "a whopping 45 percent of contracts signed on units above $4 million were made off of floorplans." In other words, nearly half of Manhattan's high-end buyers are snapping apartments that haven't even been built yet.
Buying in brand-new construction has its pros and cons (if you can afford it at all, that is), as we've written before. But for those mulling a down payment on a condo that's still under construction, we've rounded up some of our best advice:
- For buyers of brand new condos, 16 crucial questions. Key things to ask before you sign on the dotted line, including the status of the building's tax breaks, what happens if the developer gets behind on construction, and just how soundproofed your walls will be.
- Buying a new condo? Skip to the head of the line and save. If you take on the risk of buying early in a condo building's development process, you'll get ahead of the competition, and avoid the price hikes that tend to happen as these projects near completion.
- Why you may want to buy (or not) in a condo when it's nearly sold out. On the other hand, you'll get to move in sooner and have an easier time locking down financing if you wait until a project's nearly sold-out to stake your claim.
- How do I get a mortgage for a condo that's not built yet? While it's tough to get financing for a building that's still a construction site, most developers have a "preferred lender" for the project that you can work with.
- The 7 most common construction defects. Just because a building's brand new doesn't mean it doesn't have problems. Watch out for facade leaks, window leaks, ventilation problems, and more.