The second challenge that the Manhattan new construction real estate market brings to prospective buyers is understanding the idea of off-plan purchasing. In such a fast moving market, sometimes the only way to purchase some new construction condos is off-plan, meaning before the build is complete. There are both benefits and issues associated with this, and understand both is essential before jumping in.
Being in right at the start with a condo is useful for a couple of reasons, you are the first one to live in it, which many people value, but also you avoid having to petition for ownership as you do with existing buildings. Whilst this is never much of an obstacle, it does mean that the purchasing process itself for a new build this way can be a quicker process. Although it can be up to two years before you can move in depending on the construction timetable, so be aware. With off-plan purchases, you also often have the chance to customize your property, with even quite major alterations often possible by negotiation at this stage, so you can get exactly what you want. The biggest drawback though, is that you won’t really know what you are buying until construction is completed. What will the view actually look like from that 15th story apartment for instance? How will the sunlight enter the rooms? None of this will be known when you agree to purchase.
There are some significant legal considerations buying off plan as well, building sales numbers can be crucial. You will need a certificate of occupancy from the local government agency or building department to be able to close on the property, this certifies that the condo is in compliance with the presiding building codes and laws, and is in a suitable condition to be occupied. An experienced real estate attorney will be able to help you with his process.
There are also additional fees for new build purchases, these are collectively known as closing costs and comprise:
These extra fees must be taken into consideration during the purchase decision, with higher value properties the sums involved can be quite significant and not something to be ignored.
A good buyer’s agent is useful here, they can not only help you find the right property to begin with, but guide you through the off plan process if you are unfamiliar, and assist with understanding the extra closing costs involved.