Buying off the plan & why
When looking to buy a property, consider buying off-the-plan and you could reap the benefits. The potential for financial gain these investments can offer can mean huge savings for buyers.
The increase in popularity of purchasing off the plan is mainly due to the increased awareness and protections provided by off the plan contracts and disclosure documents that clearly state what you are purchasing. With deposits held secure in a solicitor’s Trust Accounts and new properties in attracting statutory warranties protect you from any issues.
If you’re considering buying off the plan, it’s important to consider these benefits as to why buying off the plan can be more beneficial in the short and longer term:
Price
Developers often offer incentives and need early sales and once they meet their financial conditions, they often increase the purchase price on the remaining properties. Therefore, for investors who commit early to the project there is often a good price incentive.
You will have secured your new property at today’s price with certainty, but a rising market will mean that by the time you settle, you may have already made some equity. An off the plan purchase means you can lock in the ownership of a property, without having to settle for an extended period of time. A buyer can secure property at today’s price yet often not have to settle for up to two years or even longer. This means that while you’ll pay a deposit upon signing a contract, you don’t have to pay the balance of the money until the property is complete.
Choice
Getting in early allows you to choose your purchase from a range of properties within the development. A wider array of choice means a greater opportunity to make sure you purchase a superior position, aspect and floor layout. This in turn, can offer better potential for strong capital growth and maximise rental yields. Penthouse apartments and others with the best views are often snapped up first, it’s a good idea to go in knowing what you want from your apartment.
You might also get to have some input into the building process, certain aspects of the layout and finishes of your property. Most developers offer two finishes and you might choose between a light and dark colour scheme. You might also be able to select from a wider range of various fittings, fixtures, appliances, internal colour schemes and latest designer finishes.
Government incentives
New properties often attract government benefits from state and territory governments. Most provide stamp duty concessions and increased First Home Owner grants for brand new properties.
Tax Benefits
As with all investment property purchases there are some significant tax benefits. These benefits are greatest for brand new property, or off the plan property, as there are higher tax deductions via depreciation allowances of a new property. Stamp Duty benefits are available to some buyers and can save you thousands of dollars on your purchase.
Time
If you’re an owner occupier purchasing off the plan, you instantly have the added advantage of ‘putting things in order’ before you move in. Co-ordinating the sale of an existing property can be stressful, but knowing that you have some time before your new property is ready to occupy provides you with valuable time to plan for your move and can reduce stress considerably. If you have property you need to sell, buying off the plan usually gives you up to 2 years to arrange the sale of your existing property.
Benefits of Buying New
New property will be constructed in accordance with the finishes and materials described in the contract and you will be provided with builders and manufacturers warranties. This will ensure you are protected from any defects and changes.
New homes are built in accordance with the latest building codes and safety regulations, new technologies, energy efficient standards and building practices. New properties provide peace of mind that no maintenance or existing unseen defects exist such as termite, plumbing or electrical complications. The maintenance on a pre-owned home can be immediate.
