Locating Preconstruction Deals

By Chris Anderson, PhD

So suppose you are now interested in striking a preconstruction deal with a developer, but you are not fully aware of the intricacies of the game.   The first step in this direction would be to collect the necessary information about it.   Internet is the best choice available for you that could provide you information about a developer or a real estate agent, for finding a preconstruction deal.   Choosing the right developer is one key aspect of a deal.

Choosing the right developer is one key aspect of a deal.   When you are locating a preconstruction deal, you are buying the services of the developer who is supposed to build the condominium.   To have a satisfactory deal it is essential the developer meet your need well.   For you to truly profit from this, you have to be convinced the developer is going to build you a top quality product that you can resell for a profit.

The building industry is a thriving one with scores of developers available in the market.   Among them, you have to choose a particular one and this needs ample precision on your part.   Offering different types of construction, some may specialize in design while others in energy efficiency factors etc.   There are universal factors that you cannot overlook even while deciding for any particular home.   Factors like building of quality homes, after-sales service and the reputation of the developer are most significant.

Remember from our previous articles, that your are integral to the developer's financing so you will get your best deal from them at the stage where they are most dependent upon you.   A developer may choose to offer the pre-sell themselves or they may enlist the aide of real estate brokers, who in turn, use real estate agents to sell for them.

My suggestion is to determine first those areas where you would like to invest.   Maybe it is in your immediate locale, or maybe it is within a 1,000 mile radius.   From there, visit the developer's websites in the area of interest.   Worthwhile information that you can collect may be brochures, pamphlets, warranty information, product literature or developer's package, so keep a keen eye on any literature passing by.

If you are interested to make a deal through a developer's real estate broker the procedure will be more or less the same.   You as a buyer may be benefited in consulting a developer's real estate agent.   A real estate agent may highlight for you the facets of a deal, you might have not paid heed to, yet.   The agent may as well give you the real financial condition of the developer, which is vital for your preconstruction deal.   If you are in touch with a developer's real estate agent, you may get to know about the latest preconstruction deal made available by the developer.   Often there is a need of a negotiating body or individual that convinces the two parties at a common point to mature the deal.   The agent negotiates the required conditions of the contract to make it suitable for you as well as the developer.   A developer's agent will be more inclined to see the profit of the developer, so be on your guard to realize the true nature of the deal before you finally go for it.

The advantage of an agent is that, you will get to know about similar deals available without paying for the service.   He or she is maintained by the developer so you enjoy the service free of cost.   Further, the work of the developer's real estate agent is to find a suitable buyer for the developer, this makes the developer trouble free and he concentrates more on producing quality work.   Wide knowledge, honest approach and quality service is the hallmark of the work of an agent and a good one should abide by the ethics of the trade.

Do you know that a good developer has to see many aspect of the building before it shapes up as your dream abode.   He takes the help of almost 45 different trades and it needs between 16 to 30 weeks completing a home project.   Needing unblemished planning and many facets of provincial and municipal regulations, your developer has to manage each of its aspect with professional dexterity.   Frequently, their plate is completely full so they enlist the aid of a real estate broker to help them move the preconstruction sales along.

So specifically, the steps that I suggest you take are
1. Determine your investment area;
2. Search for developers, brokers, and agents via the web;
3. Contact them to get additional information when projects become available.

Like with any other investment, I strongly suggest you educate yourself on the entire process and then rely on your OWN due diligence, rather than completely acting on the advise from the developer, broker, or real estate agent.

Chris Anderson is a leading authority on preconstruction real estate investing. Get his 4 day e-mail course and a 33 minute video free today! Visit http://www.GetPreconstructionDeals.com.

In addition, Dr. Anderson is the on-line training coordinator at the Van Tharp Institute, a group dedicated to providing world class training for investors and traders.