How To Buy An Off The Plan Property
Generally speaking, buying an off the plan property as an investment can be a great way to secure your long term financial future if you’re a first timer, or to build a property portfolio if you’re an experienced investor. It can also be a great way to diversify your assets if you have other investment such as shares. Buying “off the plan” can be a very different process to buying an established or even brand new property, so there are some fundamental details you need to know before you start looking.
What is An Off The Plan Property?
“Off the plan” simply refers to a property that has not yet been built, although in some cases construction on the development site may have started. Generally buyers will be shown a plan of the property, architecture drawings or an artist impression of the finished property. There may also be a display unit or suites available that shows prospective buyers a mock up of the layout and interior of the property, with a selection of design features and fixtures.
As property investments, off the plan properties can offer a number of benefits, including significant savings on stamp or transfer duties (although these vary across Australia), the ability to lock in today’s price rather than wait to purchase when the property is constructed and the ability to hold a property with only a minimal deposit and have time to organise finances while the property is being built. Ongoing maintenance and repair costs can also be much lower for brand new properties, although investors should always remember that most developments these days require the payment of strata levies.
Attracting high value, good quality tenants will be a much easier proposition when you can offer them a brand new property with all the latest gadgetry, fixtures and fittings. Choosing a property that is close to schools, shopping, transport, open spaces and entertainment also means that your property is more likely to attract tenants, remain in high demand and go up in value as you build your property portfolio.
Buying An Off The Plan Property
Doing some research on developers and builders – looking at past projects in terms of quality, value for money and how attractive they are to tenants – as well as looking at a selection of properties is the best way to become familiar with off the plan developments. It is also a good idea to contact a property investment expert such as Ironfish to help you navigate your way through choosing suitable developments and practical issues such as contracts to ensure you are getting maximum value for your investment.
Generally, when a developer decides to offer the off the plan properties to the public they are sold at a fixed price, and it is “first come, first serve”. Ironfish can give you a head start in property investment by getting access to pre-public offerings and, in some cases, even provide you with pre-negotiated deals.