Buying an Apartment Pre-Construction

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edgeclinger
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Buying an Apartment Pre-Construction

Postby edgeclinger » Thu Mar 10, 2011 1:57 pm

Has anyone on here bought pre-construction? If so, would you share your experiences with us? We are considering doing this. We understand the risks and are concerned about them, but it's possible to get a much better price by buying this way. And we've found something in the area we want. We've discussed it with our lawyer and have met with the builder's banker and analyzed it to death in our minds. But I'd love to talk to someone who has actually gone through the process and survived to talk about it!
Thanks
Lauris


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alexPeru
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Re: Buying an Apartment Pre-Construction

Postby alexPeru » Thu Mar 10, 2011 6:07 pm

My fiancee and I had been looking for ages for a flat, and most of the ones we looked at were in plans. I had the advantage of having a couple of friends who are architects, and I would send them the following:

- Plans
- List of "acabados"
- Price per square meter
- Location
- Construction company

In most cases, they would usually find something that was wrong with them. I highly recommend, if you can, to do this. I have a few friends who have bought in pre-construction, and have been very happy with their flat.

We ended up buying something that was already finished, just because we loved the apartment.

Good luck!
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adrian Thorne
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Re: Buying an Apartment Pre-Construction

Postby adrian Thorne » Fri Mar 11, 2011 2:11 pm

Lauris take Alex's advice. If you see an enpty lot then you could be buying anything from a fake deed to an imaginary department. First step if you cannot afford a representative is to see if the land is registered in the sellers name.
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Re: Buying an Apartment Pre-Construction

Postby redrum » Sat Mar 12, 2011 4:11 pm

the first step is to see if the project is being financed by a bank. if so, then you are virtually guaranteed a safe purchase.
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Re: Buying an Apartment Pre-Construction

Postby euroman » Sun Mar 13, 2011 4:49 pm

I was in Lima this week and visited some projects. I noticed that appartments sold pre construction those days are getting more expensive and smaller.

I visited the projet in San Miguel behind Tottus/Sodimac. They sell appartments for 100000 soles. You might think that`s not bad for the area. But they are only 30sqm. It's basically a room with private bathroom and a kitchen unit in the corner. There are only 2 small windows so you have to switch on your light all day. They also charge a monthly maintenance charge of 150 soles. I would say this project is a ripp off.

I talked to a bank and the mortgage is a killer too. You would pay 1200 a month to buy this places. There are very few people in Lima who earn enough to pay that money. And I am sure people who can afford that would rather rent a place for less that that money.
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Re: Buying an Apartment Pre-Construction

Postby redrum » Mon Mar 14, 2011 6:30 am

euroman wrote:I was in Lima this week and visited some projects. I noticed that appartments sold pre construction those days are getting more expensive and smaller.

I visited the projet in San Miguel behind Tottus/Sodimac. They sell appartments for 100000 soles. You might think that`s not bad for the area. But they are only 30sqm. It's basically a room with private bathroom and a kitchen unit in the corner. There are only 2 small windows so you have to switch on your light all day. They also charge a monthly maintenance charge of 150 soles. I would say this project is a ripp off.

I talked to a bank and the mortgage is a killer too. You would pay 1200 a month to buy this places. There are very few people in Lima who earn enough to pay that money. And I am sure people who can afford that would rather rent a place for less that that money.



S/. 1200 a month is not that much, you would be surprised to learn how much people make in lima. i would say that at least 65-70% of the work force in lima make 1200 as a minimum.
just think of all the construction projects in lima. do you know what the MINIMUM salary is for the lowest job skill? right now its slightly more that S/. 400 per week. and thats just for the guys that do all the hard labor, the skilled labor earns anywhere between 500 - 600 per week. engineers make anywhere from S/. 2000 and up per month same with architects.
even with a household maid its hard to find a good one for less than S/. 800 per month and combined with there spouses salary and/or son/daughter they could easily afford a mortgage more than S/. 1200 per month
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Re: Buying an Apartment Pre-Construction

Postby euroman » Mon Mar 14, 2011 2:56 pm

redrum wrote:

S/. 1200 a month is not that much, you would be surprised to learn how much people make in lima. i would say that at least 65-70% of the work force in lima make 1200 as a minimum.
just think of all the construction projects in lima. do you know what the MINIMUM salary is for the lowest job skill? right now its slightly more that S/. 400 per week. and thats just for the guys that do all the hard labor, the skilled labor earns anywhere between 500 - 600 per week. engineers make anywhere from S/. 2000 and up per month same with architects.
even with a household maid its hard to find a good one for less than S/. 800 per month and combined with there spouses salary and/or son/daughter they could easily afford a mortgage more than S/. 1200 per month


Sure, there are people who make a lot of money.
But the minimum wage is 550 a month.
There are a lot of people who make less than that.
The elderly, unemployed, streetvendors, homeless and poor are often forgotten. Although there are a big part of the community.

When I lived in Lima, I lived next to a building where rooms where rented out.
There where whole families living in ONE ROOM and some even struggled to pay the 250 a month rent.
Lima is not just Miraflores and San Isidro. There`s a lot of poverty in Lima.
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Re: Buying an Apartment Pre-Construction

Postby stuart » Mon Mar 14, 2011 3:25 pm

A project financed by the bank is no sure guarantee. My sister in law's apartment was completed with the ceiling 5cm lower, as was every over apartment in the building. Many things were unfinished and the construction company have put as much effort into avoiding responsibility as they should have fixing things.

According to El Comercio, almost all construction companies operate at a loss. This is part of a fraudulent scheme they all employ to never pay taxes. Essentially, the 20% they ought to pay is siphoned off as salary to the owner of the company. With limited liability, any lawsuit would result in the company being closed down to avoid payment.

Although there is only a small risk that you will never receive your apartment, you would be buying something completely blind. You'd be gambling on Peruvian honesty and business ethics in a country with no legal system.
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Re: Buying an Apartment Pre-Construction

Postby euroman » Mon Mar 14, 2011 4:02 pm

I guess if you buy from a company linked to a bank then you would be safe about getting your appartment.

Still, the problem is the after service.

I bought my house from a company. The project was financed by INTERBANK.

I am lucky, my house is fine. But the houses that were built at the other side of the condominium are poorly finished and full of defects. Leaking roofs, cracks in the walls, often no watersupply. At the end those people had to pay for the repairs themselves. Warranty? It's impossible to get in touch with the company and the only response you get is...we are working on it.
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Re: Buying an Apartment Pre-Construction

Postby agantuk » Tue Mar 15, 2011 12:50 pm

my spouse and i looked at buying pre-venta apartments for the same reason as the OP. but i found it extremely difficult to visualise the space by just looking at an architectural drawing. i needed to walk through the apartment even in an unfinished condition.

all the suggestions offered by other posters are very much right. you should certainly get the contract evaluated by a real estate lawyer before signing anything. also try to go with companies that have a long-term reputation and history in peru (ask your peruvian friends) not only for proper and timely delivery of your apartment but also for construction quality (earthquakes, need i say more). ask for all the fees (municipal, city or federal) you have to pay in addition to the price of the house, and the other official paperwork that they will (or will not) submit for you.

hope this is helpful. best of luck!
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Re: Buying an Apartment Pre-Construction

Postby seb2010 » Tue Mar 15, 2011 5:33 pm

The most important thing is the reputation of the constructor. Check previous buildings that they have completed and ask people living there about their experience. Most likely if they have a long history doing business and quality work, then your building will be fine. Definitely have the contract reviewed by a lawyer before moving forward.

Good luck!

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