Pre-Construction
I am just looking for anyone with knowledge in pre-construction. I have been dabbling in this quite a bit lately, leaning on others guidance and would like to just gain knowledge for myself and "get my own foot in the door." I deal with investors already in residential because the cost of living for a 3/2 can be under $300k in taxes for a $150k house here so I have the business just need MORE knowledge in pre-construction. See my profile for contact info. Thanks for any advice! :-?
[addsig]
A little confused at what you mean by "pre-construction"?
I do acqusition and construction combined and am an investor.
process is simple, get your foot in the door with a developer you feel does good projects and buy a reservation or buy a contract flip from another investor and relist at a higher price. Always keep in mind you either need to find another buyer for the unit or get stuck buying the unit yourself(unless you can afford to walk away from a 20% letter of credit/cash). Precon as well as older finished units in are area(Gulf shores) has gotton out of controll. Some of the developers are pricing units at end user pricing so becarefull who you business with you dont want to get stuck by paying to much . They seem to be forgetting about the investors. You can try doing seaches on the net to find developers looking for investors themselves so they can keep realtor commissions.
I have been working with the investors but am wanting to do this myself as well. I know that these condo deals can be quite shady. I was able to get my name on a list and be assured for pick but then the deal got held up and the condo price per sqft went from $400 to $560 (still going up) over night. So, quickly I began to inquire about this deal a little more. Turns out the developer has pulled the same stunt before and 1st buys went all the way to close not by choice. Now, I have an opportunity to buy in to another in Orange Beach. So, I am studying this project right now.
About the letter of credit or lenders. So far, I have been asked for the 20% line of credit and the one I am looking at now requires 10k deposit per unit. As was mentioned.... these people can be shady. I think I have come up with a plan that may work in order to get to know developers without running into too many Realtors because I am one myself. I will keep you updated if you are interested. Still, if you have any other advice I need all I can get seeing how I am alone in this venture. Of course I had to pick a not-so-normal way to invest...but I like challenges.