| Preconstruction real estate investments are | | | | can net in $100000 in price appreciation in one |
| investments in 'yet to be completed' construction | | | | year. The down deposit required by the developer |
| projects. Completion may still be six months, a | | | | in a preconstruction property is around 20%. |
| year or two years away; may be even more. An | | | | Therefore a condo priced at $500000 will require |
| investor is able to put in a small deposit to book | | | | a down deposit of $100000; half to be paid at the |
| hold a condo or apartment in the project till it is | | | | time of contract and the other half at the |
| complete. He can then sell the property to | | | | beginning of construction. Based on a conservative |
| capitalize on the price appreciation from the date | | | | estimate of 20% annual appreciation in real estate |
| of investment. | | | | prices as per current trends, the under |
| The preconstruction investment is found quite | | | | construction condo would be worth $600000 |
| lucrative to most investors on account of its | | | | after one year. This would be a straight 100% |
| simplicity and low risks. Since the investment is | | | | annual return for the first year on the investment. |
| small and has to be made in cash, there are no | | | | Simply stated, the capital invested would double |
| mortgage related hassles or expenses. There are | | | | every year. |
| no taxes involved and the investor just needs to | | | | Preconstruction investment is especially attractive |
| sit tight and keep a watch to see that his | | | | for Miami real estate because of the influx of |
| investment keeps growing with the appreciation in | | | | large number of people into Miami including buyers |
| real estate prices. | | | | from outside the US interested in taking |
| Preconstruction investment in Miami is of particular | | | | advantage of the flexible rules available to foreign |
| interest on account of the rate of appreciation in | | | | nationals who want to purchase Miami real estate. |
| property prices over the last few years. It has | | | | Waterfront property is the most in demand, being |
| been observed that the average rate at which | | | | preferred by such buyers including those from |
| real estate prices have been rising annually in | | | | States like New York and California and others. |
| Miami has been close to twenty-five percent. In | | | | Instead of rushing headlong in a preconstruction |
| the case of an investment in a constructed house | | | | investment, it is very important to gain detailed |
| for rental income, there is no need to manage | | | | information before making the actual investment. |
| tenants in a preconstruction investment. And the | | | | This is because every developer or every |
| absence of mortgage related issues means that a | | | | property is not desirable from the investment |
| developer will sell a preconstructed condo | | | | angle. A project may not be well analyzed or |
| apartment unit irrespective of credit history | | | | priced right. Therefore it is best to seek the |
| ratings. | | | | services of a local realtor to overcome such |
| On the basis of available figures it is safe to | | | | difficulties while making a selection for the |
| assume that investing $100000 in a $500,000 | | | | investment. Talking directly to the developer or |
| condo in a preconstruction stage project in Miami | | | | his staff may not yield objective information. |