How to approach buying highrise condo (sales, real estate, HOA fees)

[logic672]

Hi all,

I'm interested in buying a condo in Midtown. I'm particularly interested in the buildings like Spire, metropolis, viewpoint, 1010, plaza, etc.

What is the best way to approach buying a unit at one of these places, with the objective being getting the best deal possible? Is it better to buy pre-construction? How about trying to get units that pre-construction buyers backed out of? Is it better to buy from the developer or from an owner selling his own unit? Can I get better deals by not using an agent?

Thanks in advance!

[lastminutemom]

What is your objective in buying? Is it an investment? I met with a developer a few days ago and he says that the condo market hasn't hit bottom here yet.

I think you need to research all avenues and see which one gets you the best price. But to recoup your money, you probably need to be prepared to hold onto it for a long while.

My friends' mother has been looking a high rises for a few years -- the really high end, more mature ones, and buildings that she once couldn't afford have begun to fall into her price range. Her realtor told her to wait at least another year and she will have even more options.

[George Chong]

Originally Posted by logic672

Hi all,

I'm interested in buying a condo in Midtown. I'm particularly interested in the buildings like Spire, metropolis, viewpoint, 1010, plaza, etc.

What is the best way to approach buying a unit at one of these places, with the objective being getting the best deal possible? Is it better to buy pre-construction? How about trying to get units that pre-construction buyers backed out of? Is it better to buy from the developer or from an owner selling his own unit? Can I get better deals by not using an agent?

Thanks in advance!

Bottom line, you need a good Buyer's Agent to navigate you through all your options and help you answer all your questions so that you can make an educated decision.

There are pro's and con's of each building but the primary issue is which building will actually be the best investment for you.

Usually if you go in unrepresented into new construction, the on-site agent will get paid a higher commission since the developer/builder does not have to compensate a Buyer's Agent. That "savings" is not necessarily passed on to you as a Buyer. Remember, the developer/builder pays the real estate commission and keep in mind, you will be unrepresented. The on-site agent is not looking out for your best interest.

If a Buyer backs out of a pre-construction contract - it's no big deal for the developer, they will just sell it to someone else so I can't see that there would be an advantage to you other than a more desirable floor plan/floor might be available. But don't count that the savings will be passed on to you.

Find an agent that understands all the different buildings, its nuances and can educate you on the condo docs and bylaws. I think you will be amazed when you hire someone that is truly looking out for your best interest what insight you will gain on the Midtown condo market.

Good luck!

[logic672]

Thank you for the responses!

Just to clarify: I will be staying in the condo for a MINIMUM of 5 years. I am definitely not looking to flip it, but I want to get it at a low price so when it does come time to sell it, i can charge a little lower than the competition to alleviate the difficulty of selling a condo.

In respose to the pre-construction contract issue: An agent told me that sometimes people back out of a pre-construction sale that has since been already built, with all of the options that the buyer had chosen, and that these units the developer is desparate to get rid of, since most buyers want to come in and choose all their options. Any truth to this?

Also, i'd like to hear more oppinions on buying with or without an agent, as well as would I get a better deal buying from the developer/builder, or a private owner.

[George Chong]

Glad to hear that you would stay for a minimum of 5 years. This is not the market to be flipping real estate. There is just a lot of inventory on the market.

Yes sometimes Buyer(s) do back out of pre-construction units and have specified their finishes. Also know that if the Buyer(s) upgraded any of the finishes, the developer should have required them to pay for the upgrades in advance. The developer is not the business in financing luxurious upgrades that may only appeal to that specific Buyer.

In my opinion, I think the on-site agent was trying to sell you on that specific unit. Hey - it's their job. I would tend to believe that the developer was desperate if for example, the upgrades were $10K and they were willing to give that to you with some additional incentives such as some HOA fees being paid and/or closing costs. In new construction and pre-construction, I just ask for a lot of items for my Buyer. I feel as if you don't ask for something, they are not going to automatically give it to you.

I would think that the best deal would be for you to purchase on your own without an agent with a private owner. Obviously there would be no real estate commission involved from either side so there is an immediate savings that would hopefully benefit both parties.

If you have purchased a condo (note I said condo, most single family homes are not connected to HOA and you need to know what you are buying into) on your own before and feel comfortable in negotiating such a big purchase on your own - I say go for it. Otherwise, hire a Buyer's Agent. That's what we do for a living and you do not pay our commission and hopefully an experienced Buyer's Agent will be worth the commission tend fold.

P.S. If you can answer this question for me - then it will defiantly illustrate to me that can purchase on your own, otherwise, hire a Buyer's Agent. Which of your listed choices did a contractor set off the sprinkler system and activated the sprinklers inside units from about the 10th floor down just about a year ago?

[logic672]

^^That was Plaza Midtown! I have been doing extensive research on this topic for a while now

[George Chong]

Originally Posted by logic672

^^That was Plaza Midtown! I have been doing extensive research on this topic for a while now

You ROCK!!!

You have my blessings child - go forth and buy!

[scgraham]

Originally Posted by logic672

Hi all,

I'm interested in buying a condo in Midtown. I'm particularly interested in the buildings like Spire, metropolis, viewpoint, 1010, plaza, etc.

What is the best way to approach buying a unit at one of these places, with the objective being getting the best deal possible? Is it better to buy pre-construction? How about trying to get units that pre-construction buyers backed out of? Is it better to buy from the developer or from an owner selling his own unit? Can I get better deals by not using an agent?

Thanks in advance!

I have expounded this in other threads. When negotiating on behalf of my buyer-clients, I delve into certain data to assess how a particular builder/developer is negotiating with other buyers. When I'm armed with this data, it's merely a starting point to get a better deal for my buyer. By extrapolating the details of a new home transaction, there is potentially thousands to be saved.

Generally speaking, builders/developers protect realtor commissions for the sake of encouraging cooperation with Realtors; these professionals are a key part of providing exposure to theses builders’ new homes. Hence, a buyer would not save in this area.

However, if a builder/developer agreed to give a special discount because a home buyer opted not to be represented, one must ask an important question: Is the builder trying to save the buyer money or himself? Would a good buyer’s agent expose something adverse that an unsuspecting buyer would simply be unaware of?

The pros of using a true buyer's agent for a new home purchase are innumerable; notice that I said true buyer's agent. I am a speaking about someone who is versed on new home and new construction matters. While I agree that you don’t need an incompetent agent to buy a new home, I would, however, disagree that you don’t need a qualified buyer’s agent to maximize one’s purchase.

One can research the home buying process to a great extent and still miss many beneficial opportunities to save; only experience can extrapolate these opportunities on behalf of the buyer.

[PeteyNice]

I just did this. My buyer's agent was useful in that she got me into units and has easier access to sales data than I do on my own. But remember, your agent wants to facilitate as easy a transaction as possible. Only you really represent your interests. There is a lot of similar inventory - the differences between those buildings, IMHO, is shades and not black and white. Because of this I have started looking at other complexes in the area that are more unique.

[logic672]

Originally Posted by scgraham

I have expounded this in other threads. When negotiating on behalf of my buyer-clients, I delve into certain data to assess how a particular builder/developer is negotiating with other buyers. When I'm armed with this data, it's merely a starting point to get a better deal for my buyer. By extrapolating the details of a new home transaction, there is potentially thousands to be saved.

Generally speaking, builders/developers protect realtor commissions for the sake of encouraging cooperation with Realtors; these professionals are a key part of providing exposure to theses builders’ new homes. Hence, a buyer would not save in this area.

However, if a builder/developer agreed to give a special discount because a home buyer opted not to be represented, one must ask an important question: Is the builder trying to save the buyer money or himself? Would a good buyer’s agent expose something adverse that an unsuspecting buyer would simply be unaware of?

The pros of using a true buyer's agent for a new home purchase are innumerable; notice that I said true buyer's agent. I am a speaking about someone who is versed on new home and new construction matters. While I agree that you don’t need an incompetent agent to buy a new home, I would, however, disagree that you don’t need a qualified buyer’s agent to maximize one’s purchase.

One can research the home buying process to a great extent and still miss many beneficial opportunities to save; only experience can extrapolate these opportunities on behalf of the buyer.

You have valid points, however, let me comment on some things you stated. First, you say "However, if a builder/developer agreed to give a special discount because a home buyer opted not to be represented, one must ask an important question: Is the builder trying to save the buyer money or himself?" This doesn't really make sense to me. Of course the developer wants to save money for himself, but in doing so, he is also saving the buyer money as well. It's like any agent-less real estate transaction. Buy not having an agent involved, both the buyer and the seller save money.

Second, you make a good point about having access to prior sales data so you know a good stating point for the negotiation. However, I am in the process of selling my current home, and my selling agent is more than happy to give me this information, so this is not an issue.