Tenerife Property from a Developer/Builder
If you are going to purchase an off-plan property in Tenerife, then doing business with a developer is a perfect way to be sure that your investment comes off like smoke. The first person who can imagine what a piece of property might look like with dwellings on it is a developer. Developers and builders develop a vision for the entire house or apartment.
Developers buy a plot of land and prepare it for construction; they get the necessary permits, outline the plan for building lots, put sewerage in place, run electrical lines, ensure that water supply is available, make curbs and roads, and collaborate with architects to design buildings.
In other words, developers get everything ready so construction activities can begin. This may be a very long process, but buying an off-plan property from developers in Tenerife is a long-term investment. Property developers sell the prepared land to builders or hire builders to construct the buildings by themselves.
A builder differs from a developer, and carry out different tasks. Commonly, builders purchase finished lots from property developers. Builders operate like manufacturers who are aimed at buying supplies and materials ‘just in time’ to sell the properties as soon as possible because they prefer not to hold their investment for a long period.
Being responsible for constructing activities the buildings, they coordinate tradesman, manage the construction site, work with architects, and ensure the decorating and finishings is done properly. If a property in Tenerife has been sold “off the plan,” builders usually consult with homeowners on customized decorating.
Advantages of Buying a Property from a Developer in Tenerife
In Tenerife, there are many companies, such as EST. PRY E INV. ATLANTICO S.L., Promociones Belesar, and ACEGO – Promotora, which manage a property development from the very start all the way through to selling the ready made houses and apartments to the public. Buying property from a builder/developer in Tenerife has many advantages for the future homeowners.
When purchasing property from a developer, you get it at the developer’s price. Usually, this price is “the floor” at which property prices rarely ever go lower. Of course, for buildings, developers choose the best location, and price the property. Thus, it is extremely important to do a research to be sure that the developer’s sales price is comparable to those of other builders and developers within the same area. A perfect way to compare prices on buildings of the same quality is to apply the price on a per square foot basis.
Another advantage of buying a Tenerife property from a developer is that when the building is completed after several years, its price is usually appreciated by 10% to 20% taking into account the interest and the holding costs for the purchasers. Sometimes, it is also advisable to buy three off-plan properties from a developer in Tenerife, then, several years later, you can sell off two properties to gain the profits to pay for the third one in full.
The idea is to buy high and sell higher! Generally speaking, the buyer can speculate on future property price inflation. Thus, when a developer sells the property in Tenerife, which is at an early building stage, its price is much lower than the usual market value price. In such a case, a buyer pays a deposit, which is usually 10% or 20% of the selling price, which is fixed for the duration of the contract.
This money provides the developer with capital, thereby, reducing the amount of bank borrowing needed by the building company to finance the project. Investing in off plan property in Tenerife has proven to be very lucrative for many investors in recent years, however, in order to minimize, you should use a reputable state agent and buy from a reputable developer.
Another advantage of buying properties from developers in Tenerife comes with the guarantees that you get when buying newly-built property. In Spain, there are consumer protection laws which cover different types of build defects for different periods with the most serious defects guaranteed for ten years. So, you are covered for the maximum period, when you purchase an off-plan property from a developer.
There are also generous financial incentives on offer for buyers, which make newly-built property from developers attractive for first time buyers trying to get their foot onto the ladder. Property developers in Tenerife know that location is one of the most important considerations for those looking for an apartment or a house to purchase and are very careful about developing on land that is close to all the local amenities, such as resorts, beaches, doctors, schools, transport terminals, and shopping facilities. Most of today’s new property developers in Tenerife tend to create a sense of community within the development by adding play areas, parks, and other features for the benefit of the residents.
When you purchase a new-build from a developer, you and your family can move in as soon as it is finished. You do not need to spend much money and time to redecorate or repair your new home. In some cases, developers give the opportunity to design a new apartment, flat, or studio before it is built so it is decorated the way to suit their customers’ taste.
Buying property directly from the property developer offers you a huge discount on newly-built and off-plan property for sale in Tenerife. You may ask “why.” This is because you are in at the beginning of the development when investors are much sought after to share the load of the investment with the developer.
With most builders and developers in Tenerife, you can be sure that your investment in Tenerife is secure, safe, and protected. With an extensive selection of luxury apartments, villas, and townhouses for sale, the growing property market in Tenerife is a direct reflection on the quality of real estate being offered by many property builders and developers based here in Tenerife.
Disadvantages of Buying a Property from a Developer in Tenerife
The main problem of buying a property from a developer or builder is that there are all the chances that they can go bust or disappear. When buying property from a developer in Tenerife, do some research. If the property developer is well known, there is a big chance for the property to be completed, but if the developer has just appeared on the market, then you have to make sure that you will not lose your capital.
As for the fundamental problems of purchasing an off-plan property from a developer in Tenerife, there are several of them. The fact that some property from developers has not been finished yet causes all sorts of uncertainties that can create problems between the time of signing the contract and delivery of the building.
Large construction projects can run into different kinds of problems leading to delays. For example, bad project management, bad weather, and problems with planning permission. The thing to consider is that delays are more common that the sales agents would have you believe. It is sensible to expect some delays and build this into the contracts you sign and your planning.
If you are going to buy an off-plan property from a developer, then take into consideration one more risk, which is that the property may fall in value. No one can predict the exact evolution of the real estate market, so there is always a possibility to lose your money. Another problem of the property from the developer is a potential difference between the actual and projected product.
There is a chance that the developer may use fixtures and materials that differ from those that were specified at the very beginning of the project. However, if you will buy from a reputable developer in Tenerife, then your chances to have such problems are very small.
When buying an off-plan property from a developer, you should know that there are no exact dates of completion, as some problems may occur during the construction process.
In general, buying Tenerife property from developers may offer lots of benefits for investors as well as for home buyers. However, before buying a property, do not forget to do a full research of the property market, and seek legal advice.