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You’re looking at this incredibly well-designed promotion material of a new construction home by a builder. You instantly fall in love with what you see.
This is the place you want to spend the rest of your life or your vacations. This new construction home looks just what you need.
Your first meeting with the salesperson goes awesomely well. All the photos and designs they show you look like they’re like a dream. The only setback is that there is nothing built in the community. Zero, zip, zilch nothing. Scary eh…… I think so too!
For only $1,000 earnest money, you can get that 15% discount they offer you if you write the check now. Don’t worry; they’ll take your credit card for the earnest money on this new construction home. AND they’ll apply their fly and buy promo. Imagine they are paying for your trip to Costa Rica! Can you go wrong anymore?
Questions
Of course, you want to have a good look at the new construction home offered in that incredibly well-designed promotion material first. There must be a reason you fell in love with it and it’s a good start. Is there anything, in particular, you should ask before writing a check to buy this new construction home?
Insist your earnest money goes into escrow.
Here are a few questions to ask, just as a guideline:
- Does the developer have all the permits?
- Is the infrastructure built?
- Will the home builder do what he promises?
- How can you make sure your investment is a safe one?
- Does your money go into escrow?
- Is it smart to buy a new construction home?
- Or should you buy a previously owned home?
A builder’s model home always looks spic ‘n span.
A quiz
Quite a few years ago, we did a great quiz that gives you an idea of how safe it is to buy a new construction home in a Costa Rica real estate development. Try the quiz out now!
You might not realize there is a huge difference if you buy in new construction home that is totally finished or pre-construction. If a house is finished, such as a model home, special attention is always paid to a showcase.
Let’s cover the 8 smart steps to buy a new construction home in Costa Rica. This might help you clear up any doubt you have.
Riverside Developers promised a sunken pool in the condo’s balcony
1. Shop around
Before you sign any checks or hand over your credit card, shop around. Compare new construction homes in various developments. Check the details, the community, and the area.
2. Finished product
The finished product always turns out to be different than what is offered. You picked the floor tile when they started construction and will see a different tile installed. Will the construction be up to your standards? Sign a detailed agreement on every important detail. Have a look at the construction plans so you will get that open floorplan that you were promised!
Involve a home inspector to follow up for you if you are not available at all times.
Riverside developers delivered a hot tub that would not heat.
3. Pre-construction
Promises are so easy, delivering is not. There is always a long time between a pre-construction contract and the delivery of the home. Anything can happen during construction. I once bought a pre-construction condo that should have had a balcony with a sunken spa. They delivered a hot tub that would never heat.
4. Attorney
Use your own attorney. No matter if you purchase a new construction home or pre-construction, find a lawyer who represents you. Homebuilders will have their own, for their own protection, you should do so too.
5. Escrow
Don’t give the real estate developer any money. Insist your money goes into escrow and will not be released until closing when every detail is approved by you. Don’t make any payments before they are due and until the home builder has delivered what was agreed on. Do NOT pay before the job is completed, you will go over budget. I promise!
Incredibly well-designed promotion material by Riverside developers
6. Home inspector
Involve a home inspector from day 1 until closing. It’s the best investment you have made in a lifetime.
7. Bylaws
Read the bylaws BEFORE you sign an agreement to buy property in a condominium. Make sure they allow the pets you love so much. Do you want a fence? Check what type of fence is allowed. Do you want to build two stories? Check first, maybe there are view easements and you’re not allowed to.
This is how the building looks like and buyers lost their money.
8. Common areas
Hold back a percentage of your payments until the common areas are fully finished. You can leave that money in escrow, but you need to put it in the agreement. I have seen plenty of new construction offered with promises of beautiful pools and parks and nothing delivered.
If you are not sure what to do, contact your GoDutch real estate agent, you will get the necessary assistance. We do all that is in our power to make it as perfect as possible. If you follow the instructions!
Feel free to leave your comments on this blog.
