New construction buildings in NYC are a hot commodity, and it's easy to understand why. Who doesn't love the idea of living in a brand new home with all the fancy bells and whistles you could want and maybe even a fantastic view.
Developers spend tons of money equipping these buildings with all the features modern homeowners love and their marketing teams are great at selling them as the pinnacle of luxury. However, the truth may be more complicated.
Don't get caught up in the sales gimmicks because not all new developments are what they appear. If you need help deciding if that new building in NYC that you've had your eye on is worth the investment, here are a few things you should first consider.
Research the Developer
When previewing any newly built homes, start by researching the developer. You can just Google the address of the building and the developer's name and pull up all types of information.
Questions to ask yourself: Are they a newer name, or have they been in the game for a while? Research any past projects they've worked on and determine if they succeeded. Did they work on any new developments in NYC you could go see for yourself? It may help to look at their previous work and see if it holds up over time and lives up to expectations.
Look Into the History of the Project
You may also want to look into the project's history to determine if everything has gone according to plan. You can find this information through a Google search, or you can work with your agent to find more in-depth information.
Have there been any zoning or design issues that may cause delays? Is the developer respected in the community, or have there been complaints from neighbors or other homeowners? These issues are somewhat common with new construction in NYC. However, it's important to be aware of any potential problems that could slow down the completion time or impact the longevity of your investment.
Find Out How Many Units Have Sold
Another good way to assess if the project is going as planned is to look at how many units have already sold. Has the project been sitting on the market for a while, or are units selling like it's Black Friday, and there is a stampede of buyers waiting at the doorstep?
Several factors can influence how quickly a building sells out that may not have to do with the quality of the residence. For instance, the more expensive new development houses for sale tend to take longer to sell because the pool of qualified buyers is naturally smaller. However, sluggish demand could also be a sign of potential red flags that you haven't noticed.
Determine the Estimated Project Completion
If the construction is still in progress, you'll also want to find out the estimated completion date. When it comes to new condo developments in NYC, they rarely commit to an exact closing date for several reasons. So many things can happen during the construction process that they don't want to be held legally responsible if they can't close on time due to some unforeseen delay that is out of their hands.
However, you should be aware of this and ask them for an estimate so you can plan accordingly. Also, the development's condition should be looked at to determine if the estimate is accurate. Closing in a few months may be realistic if the building is almost finished, aside from a few cosmetic upgrades. However, if it's still just a patch of dirt, you may want to look into other options.
Compare It To Other Similar Developments
It often helps to look at the best new developments in NYC at the moment and see how yours stacks up. Even if it's being advertised as the top of the line, you may be surprised about how it compares to other new apartment buildings in NYC.
Take, for example, 432 Park Avenue. At the time of construction, it was one of the top buildings in the world. Although it's still a top-tier development, its slender construction has caused water damage and swaying. So don't buy into the hype just because it's meant to be a fancy building. It doesn't matter if the developer cuts costs.
Carefully Review the Offering Plan
Another useful way to compare your building to other new NYC developments is to carefully review the offering plan. The offering plan is a document that discloses all the essential information about a condo or co-op to the buyer. It includes things like the price, buying procedures, the building's bylaws, floor plans, board operations, and more.
When you receive the offering plan, you'll want to carefully review it with your agent and attorney to ensure you understand what you're getting and that the information is correct. You'll also want to compare it to other similar new development homes for sale to determine if the value, finishes, and monthly carrying costs justify its price compared to other NYC new construction homes in the area.
Conduct a Home Inspection
Finally, you'll want to perform your proper due diligence and conduct a home inspection. You can start with a standard walk-through to see if you can spot any potential red flags that may be cause for concern. If you think there may be serious issues, bringing in a licensed home inspector may be wise.
Bringing in a home inspector for new construction condos in NYC can be complicated. It isn't necessarily standard practice because, unlike a single-family home, the internal systems service the entire building, not just one apartment. However, it's still wise to confirm everything is up to par before signing on the dotted line.
Some experts recommend reviewing the board's minutes and accounting statements to confirm they have a solid plan for ongoing maintenance and building upgrades. However you plan to approach it, you'll want to be sure that your investment will hold up in the future.
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