The Oldest Trick in the Las Vegas High Rise Condo Book

The high rise market as a whole loses credibility when one of their projects fails, runs into trouble, or gets bad press. One of the best indicators of a project's overall feasibility is whether or not they have broken ground and started construction. When that happens, the project pretty much goes from "uncertain" to "solid" status.

Developers know that, so what happens sometimes is they start construction with their own money, but just don't do too much other than an official groundbreaking. This way, they can get more buyers interested in their projects so they can then approach lending institutions with a higher percentage of "pre-sales" which increases their changes of obtaining the desired financing.

If you need 50% presales before a bank will lend, and you only have 40%, a developer may take the chance of starting construction while hoping to get the other 10% right away. Sometimes that strategy backfires, in which case lawsuits are filed and liens get attached to the project by angry contractors who don't get paid for the work they have performed.

It's the oldest trick in the high rise condo book and one that seems to have caught up with the Spanish View Towers project and teaches buyers a valuable lesson. One of the more important things a buyer should look for in their purchase contract is the delivery date promised by the developer and a timeframe where the buyer would be entitled to get their money back should that delivery date not be met - or delivered not as planned.

While buyers probably can't successfully sue to force a project to be completed, understanding what will happen based on project delays will definitely save you time and money should an unfortunate situation develop.