Everything you need to know about apartment pre-sales: Smart investment or high risk?
In the world of real estate investments, apartment presales have generated divided opinions. While some consider them an unparalleled opportunity to access properties at reduced prices, others perceive them as a risky option.
The reality is that, like any investment, they involve a certain degree of uncertainty, but with the right information and a clear strategy, they can represent a great opportunity to grow your wealth.
What is an apartment presale?
It is often said that buying in pre-sale is “buying off-plan”, and although this definition is not entirely wrong, it is important to understand its true meaning.
A pre-sale is the initial marketing phase of a real estate development, in which investors can purchase units before construction is completed or even started.
In contrast, a traditional sale implies that the product is already built and ready to be delivered.
Pre-Sales Stages
Pre-sales have different phases, and the earlier the investment, the greater the benefit can be:
Friends & Family: this is the first stage of marketing and is usually aimed at investors close to the developer.
Public Launch: The pre-sale is open to a wider public with prices still below market value.
Intermediate stages: As the project progresses, prices increase and certainty about the development increases.
Final sale: Once the property is completed, prices reach market value.
Benefits of investing in an apartment presale
Investing in an apartment pre-sale can be one of the most profitable strategies in the real estate market, as long as it is done with the right knowledge. Buyers who buy in advance usually obtain economic and financial advantages that are difficult to find in ready-to-inhabit properties. Below, we explain some of the main benefits of this type of investment.
Lower prices than in traditional sales
One of the main attractions of pre-sales is that they offer significant discounts compared to the final sale price. As the project progresses, prices tend to increase, so entering at an early stage guarantees better purchase conditions.
Guaranteed capital gain
If you choose a location with high demand and a reputable developer, the capital gain can generate a substantial increase in the value of the apartment once it is built.
Payment facilities
Many pre-sales have direct financing schemes with the developer, which allows investing without the need for a mortgage loan.
Resale or rental opportunity
When acquiring at a lower price, a common strategy is to sell the property when it is delivered at market value or rent it out for passive income.
5 Common mistakes when investing in a presale
While presales offer multiple benefits, they can also become a bad investment if certain key factors are not taken into account. Many people make mistakes due to lack of information or for not properly evaluating the developers and the market. Here are some of the most common mistakes to avoid so that your investment is safe and profitable.
1. Failure to analyze the actual market price
A common mistake is to think that all pre-sales are an opportunity. It is essential to compare prices with similar properties in the area to make sure that you are really getting a price below market.
2. Failure to investigate the developer
There are developers with a long track record and successful projects, but there are also those who abuse the pre-sale model. Before investing, it is crucial to check background information, visit other developments and consult with experts.
3. Not considering delivery times
Presales often have delivery extensions. A delay of up to six months may be normal, but if the developer has a history of years of delays, it may be a red flag.
4. Not reading the contract carefully
Each pre-sale has clauses regarding deadlines, design changes and penalties, so it is essential to understand the terms before signing.
5. Not considering that the final product may change
Designs, amenities and finishes are subject to change. Even if they are minor changes, it is important to be aware that some variations may occur.
Is it a good idea to invest in apartment presales?
If your goal is to access a preferential price, take advantage of the capital gain and diversify your real estate portfolio, presales can be an excellent option. However, it is key to do it with information, analyze the market well and choose a reliable developer.
Real estate investments no longer have borders, and thanks to technology, it is possible to invest remotely in cities with higher profitability. If you are considering buying pre-sale, consult with experts like us at Selectta to help you make the best decision.
Is it worth investing in a pre-sale apartment?
Pre-sales of apartments are not a “golden nugget” or a high-risk investment if done with strategy and knowledge. As in any market, there are safe options and others not so safe. The key is to be informed, analyze and seek professional advice to maximize the benefits and minimize the risks.
If you want to know about projects with high capital gain potential in Riviera Maya, follow our social networks or contact us for personalized advice, invest with confidence and build your wealth wisely!