Q: I just saw a beautiful new beachfront condo project on the south coast. The renderings look great and I am thinking about buying a unit. What questions should I be asking the sales agent? Mary K. Chicago
A: One of the first things would be to see the Deed of Title on the land where the project will be located or “escritura”. Verify that the land is owned by the developer and if the developer is a corporation, ask to see the articles of Incorporation and Power of attorney. Is there a master policy of Title Insurance? The next items to ask for would be approved construction permits, ground use, feasibility studies and density approvals. Beachfront is highly desirable here for obvious reasons, however it is very important to understand that the beach is public property, owned by the Mexican Nation. Therefore, it is critical that your development has a Federal Maritime Zone concession and is not encroaching on the federal property. Also, if your development runs along the highway, that is ALSO federal zone and subject to setback limitations. So take a good look at your parking plans and understand that you will never have a “deeded” parking place in the federal zone! Typically, developments have a form purchase agreement. Ask to see the boilerplate agreement and look for the following items to be included: plans and specifications of your particular unit and the common areas, construction calendar and penalty clause in case of non-compliance, rules and regulations for the condominium and payment schedule. If the sales team is promising specific amenities, these should be detailed in the contract. Then you want to know where your payments are going. If the developer will be using these funds in order to build the project, what kind of security will he offer in order to insure the project will be completed? Is there an administrative trust in place? Is it possible to get a completion bond? If the payments are directed to an escrow account, how will they be released? Verifiable levels of completion would protect you better than calendar dates. Finally, and perhaps most importantly, what do you know about the developer? Have they completed other projects in the area? Do they have experience building on the beach? If they have had issues in previous buildings, what are they doing to improve yours? There are many outstanding developments in the bay that have the items listed above on file and will allow you to review them. Keep in mind that while the developer is building the project, it is YOUR money that is making it all possible! You can make an offer, even on a new development and negotiate a contract that is fair to both you and the developer. Purchasing in a new development can be a dream comes true if you use prudence and sound judgment. Enlist the help of an experienced AMPI Realtor to help you review documents, contracts and act as your advocate.
Do you have a question about Real Estate in Puerto Vallarta? Just ask!
Active in local and national Real Estate boards; published author and acknowledged expert on Puerto Vallarta Real Estate, Michael Green moved here in 1997 to take advantage of the unsurpassed lifestyle PV offers. Mike can be reached at: pvgetaways@hotmail.com
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