What Is Preconstruction Investing?
Quite simply, preconstruction real estate investing is when you purchase a condo, townhouse, or single family residence before it is completely built. In fact, many of these investments begin when there is nothing more than a sketch of the final property. This provides multiple opportunities for you. First, it provides an opportunity to buy at a preconstruction discount relative to fair market value so a real estate developer can obtain financing on their preconstruction project. Second, it provides an opportunity to get appreciation in the property even though you don’t even own it yet. Sometimes, you can get as much as 12 months of appreciation while only putting $1,000 down! Third, is that you may have the opportunity to enter into a great cashflowing property, with a lot of equity, if you know what to look for when searching for deals.
