I am thinking of buying a pre-construction luxury condo in grand rapids, MI. Has anyone bought one? What is upside potential? Flip or rent it out after closing using onsite management?
vik,
you need to speak with the developer of the condo and ask them questions regarding their warrantability. if they are going to be warrantable then it may be a smart move on your part to get in early. however if they are going to be non-warrantable condos then you WILL have to put down a sizable sum of money to close on the deal at the end of construction. i don’t know of a single lender who does 100% LTV non-warrantable condo loans. warrantability has to do with things like percentage of owner occupied units and other factors regarding common areas, etc…
I bought one in Royal Oak, Michigan. It was built my Morningside Group. If it’s them, I absolutely encourage your to run as far as possible. I’ll summarize my long list of complaints with that 2 years after the building opened (was soldout in presales) the same 14 units are still for sale. They were purchased by investors or people that decided to live elsewhere. They’ve been sitting on them for 2 years hoping they’d sell.
The quality of the “luxury” condos was horrible.
thanks for the replies guys…were u able to sell urs marcus? im buying for investment and not for living too…it looks like these units are not moving as fast as we think
vik,
I am working on two developments in Florida that are selling at a good price. They are selling between 175K and 250K. We are financing them at 90% LTV. They are non-warrantable due to owner occupancy limits. If you are looking for a good investment shoot me an email and I can refer you to the developer.
I convinced the lender to do a died in lieu because I had a very nice appraisel since I bought early before the develope raised prices 3 times. I was moving to California and current on the payments so the lender did it. They’ve been stuck with it ever since.