Miami Condo Construction Using Buyer Financing
Condominium developers in Miami are turning to a new source of financing – buyer deposits – to fund the construction of the next wave of condo buildings, now that bank loans have become more difficult to get. Some of the developments using buyer financing include:
- MyBrickell, located at 30 SE Sixth Street
- Millecento, a 42-story tower with 382 units at 1100 South Miami Avenue
- BrickellHouse, a 46-story, 374-unit tower at 1300 Brickell Bay Drive
A story in the Miami Herald titled “New condo financing model has merit — and risk,” reports that developers are turning to cash-rich purchasers, many of whom are investors from outside of the U.S. A similar real estate financing model apparently is common in some parts of South America. Buyers are stepping forward from Latin America, Canada, and Europe.
According to the Miami Herald, “… condo buyers are agreeing to put up as much as 80 percent in a series of down payments during construction. Ten percent of each deposit is kept safe in an account the developer doesn’t touch, as required by state law. The rest is available for construction.”
Condominium buyers who underwrite construction financing assume a number of risks, and are advised to speak with a qualified Miami condo real estate attorney prior to committing funds.
South Florida Condominium and Real Estate Attorney
Contact South Florida condominium attorney Marcy Resnik to discuss your need for legal services with a condominium purchase, sale, or business dispute. You can contact Ms. Resnik online or call her at 954-321-0176.