The biggest lies told by Developers of New Construction Condos in Miami – Dont buy a Miami Pre construction condo before reading this!
Miami preconstruction condos are selling out rapidly and the developers are using swanky sales centers and beautiful sales reps to lure in the clients and to sell them those fancy and luxurious condos they have so perfectly displayed in the brochures
Most people that invest in Miami pre-construction condos go directly to the sales center of the pre-construction condo without using an agent to guide them. Why? To save up money or to get a better price. This one is for them:
Using a buyers agent doesn’t costs you a dollar! Not even a cent!
There are a lot of advantages to using a well educated and ‘impartial’ free agent (Yes free – the seller; in this case the developer, provides them with a commission and this is already included in the price and wont be deducted from your price by not using an agent)
The buyers might argue now: Ok its for free but what else does it bring me? Here you go: Its free advice from an unbiased ally in your search for the perfect condo who also happens to know the market, the numbers and sometimes cheeky sales techniques of the developers.
I write this blog to warn you about the below Miami Preconstruction Condo developer techniques that might steer you into a bad investment or an investment that is costing you more than your bargained for!
The top biggest lies by Miami Pre-construction Condos Sales Agents
1. The actual Sq.Ft of the Condo unit The indicated Sq.Ft in the floor plans might differ from the contractual Sq.Ft or the contract might have a foot note saying that the Sq.Ft might be changed without consequences after the contract is in place. Imagine your 1,500 Sq.Ft condo becomes 1300 Sq.Ft all of a sudden!
We will show you what pitfalls to look for by seeing the finer prints in contracts and also negotiate with the developer to get the best deal for you and to ensure the sqft’age does not alter by more than a nominal amount.
2. The Renderings might differ from real design. Something to keep in mind and to specifically ask for. Make sure the renderings and the end product are not a world apart and the finishes are well done.
We have have seen hundreds of renderings and know the neighborhoods inside and out and will be able to see that a condo that sells for $300 per Sq.Ft wont be able to provide the luxury and the finishes as indicated in the renderings. Forewarned is forearmed
3. They are the cheapest and they are the most luxurious out there! A popular phrase and why would you not believe it? The renderings and the sales center look amazing and glamorous, so this condo must be one of the best condos out there. Most buyers don’t have easy access to an overview of all new Miami Luxury Condos for sale so they won’t be able to tell which one is the best. When it comes to prices, they are never revealed to the public on the developer’s websites, so unless a buyer goes to each single sales office to get the prices they will never know whether this project really offers the best value for money
The agent will know the prices in the area (well if you have a good one) and they can tell you whether the prices are too high for the area, or whether there are similar condo units available for a better price elsewhere.
4. The Maintenance costs per Sq.Ft. might differ. The maintenance costs are provided per Sq.Ft by the developer but they are hard to predict. After the building is completed and sold out, the developer retires from the project and a condo association enters. At this moment the association will have to check the list of problems or maintenance requirements and they can change the maintenance costs without the buyers consent. The original $.065 per Sq.Ft might all of a sudden become $0.85. For a 1.500 Sq.Ft condo that is $300 more per month on maintenance costs.
The Agent will see that a 3 story amenities deck wont be feasible to maintain for $0.50 per Sq.Ft and challenge the developer. In the case of the David Siddons group, we have been able to negotiate lower condo prices to balance out the risk of higher maintenance costs
5. The memberships. Developers sometimes offer memberships to beach clubs, golf clubs or other private clubs which are just for one year. The buyers aren’t always aware of the fact that this membership is only for one year as the limited time span is not something that is focused upon when trying to sell a unit.
Knowing what can go wrong and what critical questions to ask is a key factor here. Let your agent do the dirty work and ask the hard questions!
6. The Amenities might differ. Most Condos offer a wide range of luxurious amentities from infinity pools to a fully equipped gym to a library and an outdoor cinema. The buyer needs to be assured that what they promise in the sales talk will be delivered as well and no foot notes are provided enabling the developer to not deliver on his promises. Sometimes the differences are subtle – we recently heard about a developer who sold half of the parking lot to a neighboring office building, which will leave the inhabitants nowhere to park at peak times!
The experienced realtor knows the developer and knows if and how they normally deliver the advertised amenities. Also like mentioned before the experienced agent will have seen thousands of renderings and will be able to see that a condo that sells for $300 per Sq.Ft wont be able to provide some of the amenities and luxuries as shown in the renderings.
7. Future views/neighbors etc. Do you know the Miami city plans for years your to come? Are you sure they won’t build a new condo that will be blocking your ocean views or city views? Exactly, someone needs to advise you on what the future will bring and how this will impact your investment, and this may not be the person in the sales center that is trying to sell you.
Agents follow real estate news and know what is coming up in the future. Where the developer tries to sell you a unit the agent will tell you that there is an empty lot in front of the condo which might mean future condos will be build on that lot. You were going to pay $100 per SqFt more for ocean views that are dissapearing in 2 years.
8. The less valuable units. The developer sells everything in the building and their sales agents will also be happy to sell you their least attractive units (from an investment point of view). Maybe they talk you into a 1-bedroom unit in an area where 1 bedroom units won’t have good resales values or where there is no rental demand for 1 bedroom units. Often developers will hold the best units until the end, or until prices increase. As established agent we can not only identify the best lines but put pressure to have the developer release a specific unit that we know if going to be good, but would not otherwise be available.
We will tell you what the best resell units are or which units rent best. We are unbiased and want our clients to have the best deal. With access to ALL THE INVENTORY we don’t necessarily need to sell you a unit from that building!
9. We have sold 90% of the building. Its not lying when you change the truth a little bit right? When entering a sales center the buyer should be aware of these catchy phrases that makes you feel stressed to make fast decisions. Often at contract units do come back into the market.
10. Know the demographic profile of the neighborhood. One of my personal favorites. Why is it that all the pre construction brochures feature images of ridiculously good looking couples and singles just hanging out in the general neighborhood? In truth some Condos are being built in ‘less than desirable locations’ where the local population is far from affluent – not everyone drives a Maserati! Knowing your demographic is probably the most important element when investing in a Condo and realizing the demographic profile the building will rent to in the future will go along way in protecting your investment.
Avoid all this and use an agent who has seen it all before when investing in Miami Pre-construction Condos!
Buyer’s agents advantages in Miami pre-construction deals:
- They know all the condos in the area, the condo features and the prices per Sq.Ft. They will be able to steer you away from too expensive buildings, unreliable developers or they might suggest condos that full-fill more bullet points on your wish list
- They are unbiased – They don’t necessarily need to sell that one condo and therefore steering you towards a unit that doesn’t provide you with the best value
- They will know the developers, how long these developers have been in business and the quality of their end-products. In the past the David Siddons Group advised clients to not invest in a condo that was being built by a developer in financial problems (Which they didn’t know about) or a condo developed by a developer who normally focuses only on commercial properties (you really want to be their guinea pig?)
- They will know luxury when they see it. Most of Miami’s project sell the “Luxury” Concept. However, like mentioned before sometimes they sell the same levels of luxury for condos of $300 per Sq.Ft as the ones for $600 per Sq.Ft. Luxury is in the little details – the finishes – something your realtor will be all too familiar with. Your agent will know what are high-end finishes and what price that “luxury” should be selling for
NOTE: we do not say that all Miami Pre-construction developers and their sales teams are liars or don’t tell you the full truth – we just say that these are SALES PEOPLE that want you to buy their product and will sell them as being the best out there. Miami has a lot of talented and sucessful developers and sales people and we love to work with them…but they all have an agenda of their own like everyone else, so be warned