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Is it time to buy an apartment?

At different stages of construction, property prices can vary greatly. When is it better to buy an apartment: at the stage of the foundation pit or in a finished new building? Let’s consider all the advantages and disadvantages of these options.

Before the start of sales. Minimal price!

The developer has the right to sell apartments in a building under construction after receiving an opinion on compliance from the Ministry of Construction. But in practice, some construction companies conclude a reservation agreement with potential buyers earlier.

In it, you confirm your intention to buy an apartment, and the seller, in return, agrees to sell the property at the best price. For this right, the buyer pays a small amount.

Benefits of a reservation agreement

  • The lowest price, sometimes almost at the cost of the apartment.
  • Low risks: if there is no registration, the money will be returned to the buyer. But this must be written in the contract!
  • The widest variety of designs and floors

Disadvantages of a reservation agreement.

  • The reservation agreement does not guarantee that the transaction will go through.
  • The amount specified in the reservation agreement is not always included in the cost of the property purchased. Sometimes it is used to pay for the reservation. Again, read the contract.

Pit stage. Cheaper by 20-30%.

After completing the necessary documents, the developer begins the zero stage of construction – the stage of excavation, where the foundation is prepared. At this stage, you can already buy an apartment in the future building. According to statistics, about 30% of all apartments are sold at the excavation stage.

The advantages of buying an apartment in a new building at the excavation stage.

  • Low price: the difference compared to an apartment in a building already rented can reach 20-30%, depending on the region
  • A wide variety of future home areas and designs: first-time buyers get the most successful options
  • The developer can provide an installment payment option, generally interest-free.

Disadvantages of buying an apartment at the excavation stage.

  • The apartment will have to wait for several years.
  • The risk of freezing the construction site, for example, if there is no demand for apartments or the developer realizes that there will be high costs (due to groundwater, expensive communication lines, etc.)
  • The risk of changing the project or the number of floors: the less built, the easier it is to change. For example, they planned 5 floors but will build 15. Or the finish will not be as promised.
  • Double expenses, for example, for a mortgage or installments and renting an apartment
  • Possible delay in the construction and delivery of the house.

The house is half-finished. 10-15% cheaper

If you do not want to invest in an apartment at the stage of the foundation pit, you can wait for the moment when the outlines of the future house are already quite distinguishable. The likelihood of construction freezing in later stages of construction is much lower. However, the prices are still reasonable.

Advantages of buying an apartment at the 50% completion stage

  • Less waiting time for an apartment
  • The price is still less than a finished house.
  • You can verify compliance with the construction progress with the established deadlines
  • Less chance of getting into a long-term build (but they’re still there)

Disadvantages of buying an apartment at the stage of 50% readiness.

  • The price of the apartment has already increased by 10-15% compared to the excavation stage.
  • Successful designs and floors are generally already out of stock
  • Possible delay in the construction and delivery of the house.

Important! If the apartments suddenly dropped in price, this may indicate that the developer does not have enough money for the current construction. This is a bad sign.

How to protect yourself?

One of the signs by which you can guide yourself when choosing a new building is the accreditation of the developer in the big banks.

For example, when crediting a developer, you necessarily check:

  • The commercial reputation of the legal entity, its administrators, and the group of companies to which it belongs (if included).
  • The company’s experience in the construction industry: how many objects have already been built and how timely they were commissioned.
  • The economic situation of the company at the time of accreditation.
  • Construction documents: construction permit, project statement, site documents, and urban planning plan for the site. The bank makes sure that all the terms prescribed in the documents are up to date, that there are no encumbrances or restrictions for the construction of a house on this site: power lines, airport, architectural monuments, etc.

Apartment in a rented house. Total cost

The safest way is to buy an apartment in a rented house. But this is the most expensive option. Of course, you can take advantage of the promotion or ask the developer for a discount. But don’t expect to save more than 5%.

The advantages of buying an apartment in a rented house

  • It is safe: the object is finished and delivered.
  • You can register as soon as possible.
  • You can see exactly if the object corresponds to the project, you can evaluate the quality of construction, infrastructure, and the local area.

Disadvantages of buying an apartment in a rented house.

  • More expensive than in a building under construction.
  • In the next year and a half, it will be very noisy and dirty because your neighbors will also do repairs.

It is necessary to note that the lower the price of an apartment in a new building, the greater the possible risks. Choose a developer from a list of reputable and verified companies. You will also need to be prepared for the fact that you will not receive an apartment immediately after the completion of construction. And finally, do not forget to read the contracts very carefully.

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