Re: Interesting… - Posted by Stacy (AZ)
Posted by Stacy (AZ) on May 06, 1999 at 16:47:51:
I don’t know for sure, but I’ll take a crack at it. It sounds a though investors are signing purchase agreements with developers before the condos are built. I know for the new houses I’ve bought, this normally only takes about $500 to $1K earnest, until it gets to the “customization” phase, where the tile, paint, carpet, and any upgrades are about to be installed, and then more money goes into the kitty. Each builder will have a different payment scheme…some will have you contribute more money at the framing stage, etc.
Then, it seems these investors are waiting until the condo development has sold-out, and are either assigning their contracts or simul. closing with new buyers. I would prefer assigning the contract, since I wouldn’t want to deal with the extra deposits before closing.
It doesn’t really surprise me that flippers are making 10K to 15K. If you are first to buy in a development, you usually get a better price than the last buyers. My last new home appreciated by over 10K before I even moved into it because the builder had raised the prices monthly throughout the project.
Anyway, this is my guess. Hmmmmm.