Blast From Past: Buyers Getting Into Contract on as-Yet Unbuilt Homes
All over the country, including New York City and certainly Brooklyn, developers are marketing and buyers are getting into contract for homes that are not even built yet. During the downturn, so many developments stalled that buyers grew leery of pre-construction sales, The Wall Street Journal reported. But a shortage of inventory is pushing buyers into…
All over the country, including New York City and certainly Brooklyn, developers are marketing and buyers are getting into contract for homes that are not even built yet. During the downturn, so many developments stalled that buyers grew leery of pre-construction sales, The Wall Street Journal reported. But a shortage of inventory is pushing buyers into contract sight unseen. “Today we see presales as early as two to three years away from completion,” the Journal quoted Kelly Kennedy Mack, president of New York-based Corcoran Sunshine Marketing Group, as saying. On the plus side, in a rising market, by the time buyers close on their units, they may already be worth more than they paid for them. On the other hand, you can’t kick the tires and there are often significant delays in closing, as we have seen with Prospect Heights building 659 Bergen Street. Above, a rendering of new townhouses being marketed pre-construction at 357-361 Henry Street. Would you buy new construction before it is built?
Return of the Sight-Unseen Market [WSJ]
I won’t even buy a pair of shoes without seeing them first and stepping into them.
Um, noooooo. How quickly we forget how many people lost their deposits completely, or had them tied up for years, when a developer went bankrupt or had legal troubles. The 659 Bergen story should be a cautionary tale for all of us.
Or, at the very least, if I really really really loved a building that was still under construction I would have a lawyer draft a watertight contract to protect my investment. But, even then, what if the building doesn’t turn out as you anticipate? Seems like too much of a risk.