Here are all of the questions I wished that I had asked before we purchased our first property in Mexico. We bought into a new development, so many of these questions are for buying new construction. Remember that everything has to be in writing. An email probably won’t suffice and hold up in any disagreements. You need important statements notarized. We learned pretty quickly that although we paid in USD, things aren’t the same as in the US. The developer can change his mind and you may have no recourse.
We have friends that purchased at Sotavento, and the project stalled due to lack of funds. They had zero options. Only thirteen owners had paid in full for their condos. They contacted an attorney and were told that they could sue the developer, but most likely would see very little of their money and their condos would never be completed. So they just had to hope and wait that more people would invest in the project. Five years later the project has finally started up again. Make sure that your final payment coincides with you getting the keys to the unit.
If you are buying into a new development, the realtor most likely works for the developer. So he will not be working for your interests. Get someone that will work for you!
Ask these questions before committing to purchase.
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What does a move-in ready unit mean? Will you be listening to construction noise all day from an incomplete unit next door? Will you have an elevator to get to your unit, or will you have to walk up 5 flights for the first 6 months?
- When will common areas be completed? These include gym, pool, common are furniture, entrance, pathways, storage, parking.
- What happens if any common areas are not completed on time? What happens if they don’t include all common area items that were promised (pool furniture, barbeque, gym equipment, pathways, gardens…)?
- Your unit has a specific contract, but the common areas can be changed and modified to save the builder money. If the realtor promises items for the common area, ask to get them in writing.
- Will you have parking and a storage unit? If so, have that included in the contract.
- When will full-time security start? Who pays for security while there are still incomplete units?
- When will the full-time administrator start?
- When will HOA dues start?
- What are the Homeowners Dues?
- Do the Homeowners Dues include insurance for either Common Areas or for the entire development?
- How does insurance work? Will there be a Master Policy covering the entire development, or will each owner be responsible for covering his own unit with common areas covered under a separate policy? What is included in the Common Areas Policy? Are Decks, patios, windows, and doors considered part of the condo or part of the common area?
- What is the budget?
- Are there any special assessments due?
- What happens if a homeowner doesn’t pay his dues?
- How often and under what circumstances can the water or electricity be turned off by the developer?
- Will the developer be supplying emergency exit signs and fire extinguishers? If not, expect to have an immediate cost of $150USD per unit upon completion of the development.
- If it’s a new development, ask to see the proposed Homeowners Association Budget.
- Any new development will have to create their own condo rules. Do you have any concerns about pets, renters, how many people can stay in each unit, guests at the pool, personal belongings in common areas? You may want to contact other owners, as different people have strong feelings about things you may or may not care about at all.
- Will they give you cans of paint so you can do your own touch-up painting inside your unit? Or are you on your own to match colors?
- What happens if any elements of the contract are not included? These elements can include lights, outlets, ceiling fans, cabinets and more
- Can you break down the costs of items on the contract? For example, how much is each light installation worth? This is good to know in case you want to add lights, and also in case they short you the installation of some lights.
- Will you have access to other owners as they commit to buy? When will you be provided with contact information for other new owners?