Buying pre‑construction in Florida

Reservation, then contract

Most new Miami buildings sell in two steps. First comes a reservation: a small, refundable deposit that holds a unit while the developer finishes the legal documents. A reservation is not a purchase, and either side can usually walk away.

The purchase contract comes later, once the developer is ready to sell. This is the step that commits you, starts the deposit schedule and triggers the protections below.

Fifteen days to change your mind

Florida's Condominium Act gives buyers of a new unit from a developer the right to cancel the contract, without penalty, within 15 days after signing it and receiving the required documents. That window resets if the documents arrive after you sign. The developer must print this right on the contract itself.

Use those days. Read the prospectus, the declaration and the proposed budget with an attorney, not just the brochure.

Where your deposit goes

Developer deposits must be held in escrow by an independent escrow agent. The first 10 percent of the purchase price stays in escrow until closing.

Anything above 10 percent may be released to the developer for construction, if the contract allows it. That money builds the building, but it is no longer sitting in escrow. Miami deposit schedules often reach 30 to 50 percent before completion, so it matters which part of your money is protected and which part is at work.

010%30%50%100% of price

First 10%

Held in escrow until closing

Above 10%

May fund construction, if the contract allows

The balance

Due at closing

The documents worth reading

• The prospectus, which summarizes the project, the unit, the amenities and what the developer may still change.
• The declaration of condominium, which sets the rules of the building, including leasing and use restrictions.
• The estimated operating budget, which shows the monthly association fees and how reserves will be funded.
• The floor plan and specifications, with the finishes and any allowances written down.

Questions to ask before you reserve

1. Is construction financing in place, and with whom?
2. When is completion expected, and what happens to my deposit if it slips?
3. Which part of my deposit can be used for construction, and when?
4. What can the developer change about my unit, the amenities or the building after I sign?
5. Which closing costs will I pay, including the developer's own costs passed on to buyers?
6. What are the leasing rules, including minimum lease terms?
7. Has the developer completed buildings like this one before? Can I see them?

Financing and closing

Many buyers pay deposits during construction and finance the balance at closing. Lenders treat new condominiums differently from houses, so speak to one early and confirm the building will qualify for the loan you want. Expect a final walk-through before closing, with a written list of anything to finish or repair.

Why an advisor helps

Developers have sales teams whose job is to sell their building. A buyer's advisor knows the other launches, the price history and which units in a building tend to hold their value. If you are weighing a reservation in Miami, we are glad to talk it through.

General information only, not legal or tax advice. Florida law changes, and every contract is different. Review your documents with a Florida real estate attorney before you sign.