Only 12 percent of all U.S. home buyers in the 12 months through June 2025 purchased a newly built home, according to the National Association of REALTORS 2025 Profile of Home Buyers and Sellers. The other 88 percent bought resale. That spread isn't just a preference; it reflects real friction that new construction puts in front of buyers. Contracts are long and builder-friendly. Deposits sit in escrow for years. The mortgage doesn't fund until the home exists. And in Miami, the gap between a contract price and what an appraiser values the finished unit at delivery can be jarring.
Only 12% of buyers nationally purchased new construction in 2025. The friction is real, but so is the upside for buyers who know the rules.
None of that means new construction is a bad buy. A brand-new home in Doral or Homestead built to today's Florida Building Code is a fundamentally different product from a 1990s resale. The windows are rated for 175 mph winds. The roof system is current. You don't inherit someone else's deferred maintenance. And in South Florida's new-construction-heavy western suburbs, tracts in Doral and Homestead have absorbed thousands of buyers who simply couldn't find comparable resale inventory.
This article is about buying a home or condo that a builder or developer is building. If you want to build a custom home on your own lot with construction draws and a one-time-close loan, that's a different process entirely; see our construction loan guide.
New Construction vs. Resale: The Honest Comparison
| Factor | New Construction | Resale |
|---|---|---|
| Timeline to close | 30 days (move-in ready) to 36+ months (preconstruction condo) | 30 to 60 days from contract |
| Price negotiability | Low on price; builders negotiate on upgrades or closing costs | Higher; seller motivation varies |
| Condition | Everything new, builder warranty, modern code | You inherit prior owner's choices and deferred work |
| Insurance cost | Lower; new roof, impact glass, current code discounts apply | Higher on older roofs and single-pane windows |
| HOA and CDD risk | Developer-controlled dues initially; may jump at owner transition | Known history; reserve studies available |
| Financing complexity | Rate lock timing, CO requirement, possible appraisal gap | Standard purchase process |
| Warranty | Builder warranty, commonly structured as 1-2-10; condo projects also carry developer warranties under Florida Statute 718.203 | None from seller unless negotiated |
| Deposit exposure | Deposits tied up for months or years; escrow protection under FL law | Earnest money typically 1-3%, released at closing |
Here's Where Builder Incentives Get Slippery
Builders offer incentives. That's the headline. The details are where buyers get hurt.
The pitch in a Miami-area tract community usually sounds like this: use our preferred lender and we'll credit you toward closing costs, or we'll buy down your rate for the first couple of years. Sometimes that's a genuinely good deal. But the preferred lender is often affiliated with the builder, and the loan can be priced to recapture that credit through fees or pricing over the life of the loan.
Get a competing quote before you accept any builder incentive. A closing-cost credit you repay through pricing over 30 years is not a discount.
Under RESPA's affiliated business rules, a builder can't force you to use its affiliated lender as a condition of buying the home. It can legally tie an incentive to that choice, and most of them do. So the question isn't whether you're allowed to shop. You are. The question is whether the credit survives an honest comparison. Get the builder's offer in writing and compare total loan cost, not just the upfront credit.
Tract builders in Homestead and western Miami-Dade tend to use in-house sales teams who are trained to present the preferred-lender package as the natural default. It isn't. Getting Pre-Qualified with an independent lender first puts you in a position to evaluate the builder's offer honestly.
Preconstruction Condo Contracts: Read Every Line
A preconstruction condo in Brickell or Edgewater is not a normal real estate purchase. You are signing a contract to buy something that doesn't exist yet, at a price set today, for delivery that might be two or three years out. The developer's contract is long, written by the developer's lawyers, and almost entirely in the developer's favor.
Florida law offers some protection. Under Florida Statute 718.202, the developer must place buyer deposits up to 10 percent of the purchase price into an escrow account. Money above that 10 percent threshold can be used for actual construction. If you properly terminate under the contract or the statute, the escrowed funds come back with the interest they earned. Florida Statute 718.503 requires the contract to name the escrow agent and give you the right to request a deposit receipt directly from that agent.
Florida law protects the first 10% of your deposit in escrow. Anything above that can legally be spent on construction before your home is finished.
That protection is real, but it has limits. Escrow is not the same as a guarantee. Projects that enter bankruptcy or receivership can tie up funds for years even when the escrow was properly maintained. Before you wire a deposit, confirm the escrow agent's identity independently (don't rely on the developer's sales team), and understand exactly what events trigger your right to terminate and get your money back.
Preconstruction condo contracts also frequently waive the appraisal contingency. That means if the building delivers and the appraisal comes in below your contract price, you owe the difference in cash or you lose your deposit. Our Miami home appraisal guide covers how new construction appraisals work and what comp data appraisers actually use.
The Rate Lock Problem Nobody Warns You About
Standard mortgage rate locks are 30 to 60 days. Preconstruction condos take 18 to 36 months to deliver. That gap is the rate lock problem. You cannot hold a rate for two years at normal pricing.
Extended locks of 6 to 12 months exist, but they come at a cost: either a higher starting rate, an upfront fee, or both. Some programs offer a float-down provision that lets you capture a lower rate if the market drops before delivery. Most buyers on long-timeline projects float until they're 60 to 90 days from the expected CO date and then lock. The risk is that rates move against you in that final window.
For move-in-ready new construction, the rate lock problem is minimal. Tract-builder homes in Doral or Homestead that are already framed or nearly complete work like a normal purchase on an accelerated timeline. The complication scales with how far out the projected delivery date is.
HVHZ: Why the Building Code Actually Matters Here
Miami-Dade and Broward counties are the only two counties in Florida designated as High Velocity Hurricane Zones under Florida Building Code Section 1626. Every new home built in either county must meet requirements that go beyond what applies anywhere else in the state.
Every exterior glazed opening must be impact-rated or protected by a permanent approved shutter system. Miami-Dade's Risk Category II design wind speed is 175 mph; Broward's is 170 mph. Products used in these counties need a Miami-Dade Notice of Acceptance, a statewide Florida Product Approval is not sufficient. The large-missile impact test fires a 9-pound 2x4 at 50 feet per second at the glazing. That's the standard a new window in your Doral townhouse has to survive.
This matters for insurance pricing. A new build with Miami-Dade NOA-rated openings and a 2026 roof qualifies for discounts that an older home cannot reach. It also matters for resale. Buyers coming back to resell in five years will be selling into a market that values HVHZ compliance. Our Miami homeowners insurance guide breaks down how these code requirements translate into actual premium savings.
CO vs. TCO: Your Lender Won't Fund Without the Right One
A Certificate of Occupancy means the building department has inspected and signed off on the completed structure. A Temporary Certificate of Occupancy means it's livable but some work is unfinished.
Most conventional lenders require a full CO before funding, and FHA is stricter still about closing on anything less. If your builder says they're ready to close with a TCO in hand, you need to know exactly when the CO will be issued and whether your rate lock will still be valid. Builders sometimes underestimate the punch-list timeline. A TCO that lingers for 60 days can blow up an already-extended rate lock.
In a new condo building, the individual unit CO and the building's overall CO are separate documents. Confirm with your lender which one they require and which one you'll actually have in hand at the closing table.
Financing Limits and Loan Options
The 2026 FHFA conforming loan limit for Miami-Dade County is $832,750 for a single-family home. That's the national baseline; Miami-Dade is not classified as a high-cost area under the FHFA schedule. If your purchase price falls under that threshold after your down payment, you're in conventional conforming territory. Above it, you're in jumbo range. Our Miami jumbo loan guide covers what jumbo underwriting requires and where it gets stricter on new construction.
New construction condos carry an additional layer of financing complexity. During the initial sales period, before roughly half the units are sold and while the building has no operating track record, many conventional lenders treat the project as non-warrantable. That limits your options and often increases the required down payment. Read our non-warrantable condo loan guide for what portfolio financing looks like in that situation.
CDD fees deserve a separate callout. Community Development District bonds are common in South Florida master-planned communities, especially in Homestead, Hialeah Gardens, and parts of western Miami-Dade. The CDD assessment shows up in your property tax bill, not your HOA dues. Buyers sometimes miss it entirely during the sales process and then discover their real monthly carrying cost is meaningfully higher than the builder's quote implied. Our Miami property taxes guide covers how CDD assessments work and how to find them before you sign.
The Appraisal at Delivery: Where Deals Unravel
Preconstruction contracts are signed years before closing. The market moves in between. Sometimes it moves against you.
If prices in the building or neighborhood have softened by delivery, the appraisal can come in below the contract price you agreed to. Your lender will only loan on the appraised value. The gap is your problem. In a contract without an appraisal contingency (standard in most Miami preconstruction developer contracts), your choices are: cover the gap in cash, renegotiate with the developer, or forfeit your deposit and walk.
Appraisers on new construction have to find comparable sales. In a brand-new building with no prior sales, they use nearby new developments and sometimes resale comps. If the building's initial sales were at prices the broader market has since corrected from, the appraisal problem can be severe. This isn't hypothetical; it happened to buyers in several Miami condo projects after the 2008 cycle and shows up intermittently even in healthier markets.
The fix is simple but uncomfortable: understand your appraisal contingency status before you sign the contract, not after the appraisal arrives. For guidance on how lenders think about appraisal risk and how to challenge a low appraisal, see our home appraisal guide.
New Construction HOA and CDD Reality
New doesn't mean cheap to own. Developer-controlled HOAs set initial budgets that often understate what a fully occupied building actually costs to run. Reserves for a brand-new building are also minimal because there's nothing to reserve for yet. Once owner control transfers, the new board inherits whatever reserve and insurance reality exists. Dues jump. It's normal. It's not always disclosed clearly in the sales process.
The comparison here with a resale condo actually favors resale in one narrow way: a building with five years of history has real board minutes, real reserve studies, and a real track record. You can read those documents and make an informed judgment. A developer's pro forma budget is a projection, not evidence.
That's not a reason to avoid new construction condos. It's a reason to ask specific questions: What is the projected HOA at the time of owner control transfer? Has a reserve study been completed? What's the current presale ratio, and how does that affect conventional financing? If the builder's sales team can't answer those questions, that's information too.
Comparing new construction to resale on the financing side? Our condo vs house Miami guide covers the warrantable condo rules, HOA due diligence, and how special assessments can blindside buyers who skip the reserve study.
Questions We Actually Get
Buying new construction in Miami?
Get Pre-Qualified before you sign anything. Knowing your actual borrowing limit protects you from builder deposit structures that assume you'll qualify for more than you can borrow, and it gives you real leverage when comparing the builder's preferred-lender offer. NMLS #2583712. Equal Housing Lender.
Get Pre-Qualified Now