Preconstruction real-estate; a win-win for buyer and seller.
FACT: The real estate market in Puerto Vallarta is solidly into recovery and consolidation, so the natural outcome for developers is to bring new projects to the market… preconstruction real-estate is the way to go.
When an active market is growing new projects make economic sense for both developers and buyers. Some developers are initiating projects on property they have held in inventory; others are actively buying develop-able land. Refreshing news after almost 8 years in which few new projects were launched.
The bonus to buyers… preconstruction discounts; now that’s an incentive! Typically the buyer makes a down payment, and then through the course of construction, they make monthly payments, with a final lump sum at delivery. It is a win-win for the buyer and the seller. The buyer gets a condo secured at a predetermined price and the seller benefits with cash flow and secured sales.
It’s not surprising that paying money in a foreign country feels risky to some buyers, so it’s important to consider risk management as a part of the buying decision. The trick is to ask the right questions and assess the answers you receive. The fact is that thousands of condos have been successfully purchased under the preconstruction formula. Having said that; there have been a few cases where the buyer has ended up unsatisfied for a number of different reasons.
So how do you maximize your opportunity to win in a preconstruction purchase, and lower the risk to a minimum?
Five Steps:
- Legal due diligence: Confirm that the Seller is the legal owner of the property, or has a legal contract of sale or transfer from the owner. Insist on seeing the deed (escritura) for the property on which the construction is to take place.
- Building permits: Confirm that the Seller has current/paid-up construction permits in place for the project contemplated
- Confirm the reputation of the developer. Ask for references of happy previous clients, and check them out.
- The same goes for the master broker/marketing entity. Confirm his track record, reputation and experience in preconstruction projects.
- Finally, be sure you are happy with the sales agent who you are dealing with directly. Do they understand, and can they explain to you the legal structure on which the development is based?
Among the most highly regarded “Preconstructors” in the Bahia Norte (North Bay) area is Tierra y Armonía (Earth and Harmony), a Guadalajara-based developer with decades of successful developments in their resumé. Brochure-Alamar-.pdf, is a favorite, due to its spectacular views, beach club, and other fine amenities.
Thanks for taking the time to read thru and if you’re considering investing in a home or rental property, please consider me as your North Bay realtor. I look forward to serving you! chris@remaxplayalacruz.com or 322-173-3832 (Country code 52)
La Cruz, on the north shore of Puerto Vallarta’s Banderas Bay, provides the charm of a traditional Mexican fishing village alongside the largest and most modern marina on the west coast of Mexico; paradise for live music lovers and foodies.
