Buying off-the-plan is a bit different to buying a property that you can inspect before you commit to buy. Because of this, the process is a bit different, involving using different tactics, using your imagination and strategically taking on future risk.
There can be a range of benefits to this process, as well as some important things to consider. To make sure you make the best investment decision for you, we’ve put together this guide that will help you think through these issues and achieve your goal in owning your first off-the-plan property.
Benefits of buying off-the-plan
The main way that you can come out on top by buying off-the-plan is by getting a good deal. Some developers offer deals to get buyers in, particularly during the earlier stages of development, so watch out for new developments where construction has yet to start as discounts may be offered.
On top of this, the property may increase in value during the construction process as more buyers are drawn to it and the market changes. You might also be eligible for tax advantages such as a discount on stamp duty.
Things to consider when buying off-the-plan
Calculating risk carefully
While the property value may increase during construction, it can be risky buying off-the-plan. For example, the developer might go bankrupt before completing the property, or the property may not end up meeting your expectations. You can’t control all the risks of investing in property, but what you can do is put in your due diligence to make sure you’re being smart about the risks you take.
Do your research
The first thing to do to make sure you’re being smart about the risk you take is to do your research. Research everything, from past and projected property values in the area, to property values in similar areas, to the track record of the developer, including their contractors.
Get professional advice
The second way to do your due diligence before buying off-the-plan is to get quality professional advice. It is crucial that you have a lawyer or conveyancer look over the contract before signing anything.
Consulting a financial advisor or accountant will enable you to consider your investment options, and take advantage of any tax benefits that might be available to you.
Taking all of this into account, you’ll be in a good position to get the best outcome when buying off-the-plan.