Different types of Developers
Every development is different and incentives may vary significantly from one development to the next. Large established developers have more capital and often choose to market their new projects less aggressively. They have time to wait and sell units at a higher price when a project is completed or near completion. Small less established developers often sell a significant portion of a project during pre construction in order to gain the capital to finance the project.
Some developers have better reputations than others. Purchasing from a developer who has a tract record of completing developments on time and is known to produce a quality product will further increase returns.
What to look for in a development
As with any real estate investment, location is critical. Investing in pre-construction can often help leverage this. Areas of the city that are underdeveloped, close to transit, and undergoing infrastructure improvements are often the best areas to invest. These areas may lack value and appeal in the present however, once the infrastructure or other amenities are complete property values increase. Purchasing pre construction in an up upcoming neighbourhood will further increase returns if the neighbourhood is seen as more desirable upon completion.
