Our recommendation is to start with the establishment of the budget. In most cases this translates into pre-qualifying your creditworthiness with banks. Once the financing capacity is established. Have the sensitivity to identify the correct property as the case may be. For this you must consider: how properties are classified for banks, since according to this classification financing is variable. For this we offer you a list that you should consider to determine in which type of housing classification you want to buy.

The 2 large groups

PRE-SALE OR NEW PROJECT PROPERTIES:

Buying off plans is an exercise based on trust considering that it is not something tangible when making the decision, one of the most attractive factors is that it may be the most economical option. For this reason, experts recommend taking the following into account:

1. Investigate the trajectory of the company that carries out the work.
2. Get advice from a real estate consultant to guide you during the purchase.
3. Demand a plan of the house or apartment with the delivery of the property contract.
4. Review the contract thoroughly,

• • Payment terms
  • Penalty amounts
  • Detailed description of the property. The possible changes that they may undergo in the design, size and finishes that the contract allows.

After you are satisfied with having completed these steps, you should consider.

 THE BENEFITS OF THE PURCHASE OF A PROJECT IN PLANS:

• The cost: the property is bought at the current price and gains in value.
• The design: allows you to propose modifications of space or finishes according to your needs.
• Liquidity: offers the opportunity to pay the installment in installments. They have the option for preferential interest (as the case may be). They have the possibility of higher financing percentages up to 98%. It allows you to prepare yourself in the medium or long term financially to assume the legal expenses (costs of deeds) that the buyer assumes.

THE RISKS OF BUYING A PROJECT IN PLANS:

• Delays in the delivery of the work due to external or economic factors.
• Differences between the plan and what was executed.
• Term to cancel the property from the issuance of the occupancy permit.
• Developers can increase the value of the property if their construction costs vary.
• According to the law, it has a shorter exemption period than second-use goods.

PROPERTIES RE-POSSESSED OR SECOND USE:

Unlike new or pre-sale properties, second-use or repossessed properties give us the peace of mind that we can see in detail and physically the property we are buying. But we must also have some considerations such as:

• Inspect the current state of the property.
• Review the legal status of the farm in the Public Registry
• Review the delinquency of the farm in DGI (General Directorate of Income)
• Preferably require an appraisal to ensure the correct market value. At the same time, it allows you to check if the goodwill is viable.

THE BENEFITS OF PURCHASING A SECOND-USE PROPERTY:

• The Price: they can be up to 60% less unlike new goods in the same area.
• The habitability: you could have the property in the short term.
• Liquidity: most of them have longer periods of exemption from property taxes according to the law.

THE RISKS OF BUYING A SECOND-USE PROPERTY:

• It can represent an investment in remodeling.
• In some cases, they may have already completed the property tax exemption period.
• The subscription must be paid at the signing of the contract.
• Banks apply higher interest rates% and less financing.
• The appraisal may not coincide with the bank appraisal, which would represent capitalizing more on the investment.
• You should consider having an immediate budget for legal expenses (deed costs) that a buyer assumes.

This basic guide to take into consideration when investing in the purchase of your first home can help you identify if it is the right time to invest, it also offers you the guidelines to make that investment. It is very important to trust the expert real estate consultants to represent you during the transaction. Having a real estate consultant in the purchase or investment process does not represent any additional cost for the buyer or investor and guarantees the support and guidance necessary to achieve a successful and efficient transaction.

Yamisell González

Real Estate Consultant