Timing Is Everything: Why New Projects May NOT Be For You

Timing Is Everything:

Why New Projects May NOT Be For You

(These are the thoughts of CapitIL Real Estate Agency Sales Director Ben Levene.)

When people are looking to buy property in German Colony, Katamon, and Talbiyeh, I am a big fan of new construction.

Why?

Because in the current market of so little supply, the relatively small supply that does exist can often be in projects which are new or in the middle of construction.

They give massive benefits in terms of availability and having a choice to buy something currently. If you have got 2-3 million dollars, often the best choice is new constructions.

The question is, when is new not always best?

The Main Issue: Timing

The biggest issue that I want to discuss here is timing. People want to have their apartments ready at a specific time for a multitude of reasons. Whether you want it to be ready by the summer, by sukkot, you want to make aliyah on a very specific date, your kid is starting yeshiva and you want to be able to come on specific dates, or just anyone who has a specific date, timing is many times a very important factor.

For someone where timing is crucial, buying a new apartment that a developer says will take 2 years, could realistically take 2.5-3 years (plus), and buying in something that is almost complete and should only take 3-8 weeks can also get held up.

Currently, in the Greek Colony, German Colony, and Katamon, some buildings are basically finished. You walk in there and it is gorgeous - it looks ready to move in.

Two likely reasons for delay

However, something that we have been seeing recently, and it is something that builders have zero control over, are projects getting held up at the very end for two specific reasons.

A) connecting the electricity and b) receiving Tofes 4 (occupancy permit).

The electric company can take their time before coming to connect the new apartments, and the occupancy permit can also take plenty of time.

We are seeing a lot of stories now of buildings that are perfectly ready just waiting for these two things, which shows that when the timing is of the essence, new construction may not be right for you.

If you think all the benefits of new builds drastically outweigh this issue, then, of course, new construction is a great option.

However, we have examples of apartments in new projects that we and our colleagues have sold, and clients have been quite upset, not at us, but at the situation which is why I am telling buyers beforehand to be aware of this possible situation.

Conclusion

If timing is of the essence, secondhand apartments can have an advantage because contractually, they have to vacate an apartment according to the contractual agreement.

It is generally an easier process, (although not always guaranteed- you always need legal advice this blog is informational and not fact or legal advice), whereas with new construction that is not the case.

You may get compensated for the delays, but compensation does not mean anything if your main issue is timing.

Contact CapitIL Real Estate Agency.

See available Jerusalem real estate here and new development projects here.