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This creates a situation where developer and homeowner interests aren’t aligned. Once the developer receives the money, they are not incentivized to deliver the

This creates a situation where developer and homeowner interests aren’t aligned. Once the developer receives the money, they are not incentivized to deliver the house on time or do quality construction. The other model, where investors fund development before the house is sold, aligns both parties. The developer/investor wants to produce a good product so that it will sell at a high price and the buyer has the chance to inspect the property before purchasing.

curiousObject 3y ago
>The developer/investor wants to produce a good product so that it will sell at a high price and the buyer has the chance to inspect the property before purchasing That should be a solution. But not usually that simple, sadly The developer/investor wants to produce a product that LOOKS good so that it will sell at a high price. Read the other comments about quality And, those investors often sell the property before it is finished or before it’s even started. So you have the same problem, with a longer chain of middlemen
ryukoposting 3y ago
There's some truth to this, but the appearance of quality is far more important in the latter scenario than actual quality. The average buyer isn't a housing inspector. They may have googled some stuff beforehand, but that's not saying much. It's another incarnation of the "informed consumer" farce.