How To Buy Off-Plan Property: Seven Useful Tips

Purchasing property off-the-plan is becoming increasingly popular among first-time buyers since it is a cost-effective method to join the market. Simply put, buying off-the-plan refers to purchasing a house that has not yet been constructed. This can have significant advantages for first-time buyers and investors, but like with any major financial choice, it’s important to do your homework first to ensure you know what you’re getting into.

In this article, we’re going to give you some tips and what you should consider before committing your funds to a house off-plan.

Seven Tips for Buying Off-Plan Property

Become Familiar With the Market

It’s always a good idea to keep an eye on the market and do your homework on the neighborhoods you’re interested in, whether you’re purchasing your first home or investment property. Check if any future projects in the neighborhood could affect your purchase. If you plan to rent it out in the future, also check the current rates and average rental yields

Consider the Future

When buying a home, consider how it will sell in the future and how it will appeal to potential purchasers. Is the location in a developing neighborhood? Are there any anticipated infrastructure plans in the area that will raise the price of the property? Selling a one-bedroom flat in a family-oriented neighborhood may be difficult. Similarly, selling a family house on a busy street with a lot of nightlife could be tough.

Do Some Research About the Developer

It’s a good idea to do some research on your building developer to make sure they’re not only trustworthy but also have a track record of delivering projects on time. You can make a more informed judgment by researching their past performance and visiting completed projects they’ve worked on.

Examine the Specifications

Your off-the-plan purchase is made based on specifications, unlike an established property where you can physically view and walk about the place you’re buying. For a variety of reasons, this can be both good and negative. The disadvantage is that you are committing to a home you have not had the opportunity to view, and you may not receive the apartment you expected. To avoid being surprised when the project is completed, carefully review all of the specifications mentioned in your contract and ask plenty of questions.

Get Legal Help

When buying a house, it’s usually a good idea to hire a conveyancer or solicitor to handle all of the paperwork you’ll need to sign before closing. Because buying off-the-plan differs from buying a pre-existing property, you need to seek legal advice to analyze your contract independently and ensure you understand all the tiny print and provisions that may not always be in your favor. There are costs involved, but they are insignificant compared to the costs of dealing with legal fights later.

Arrange Your Finances

Getting pre-approval for a loan before signing any contracts is a good idea. Note that banks may grant conditional clearance for off-the-plan purchases, but they will not advance your money until the property has been built and a valuation has been completed. A mortgage offer is usually only valid for six months after it is made. Some lenders will then extend it for a short time. However, you may find yourself needing to start over with your application. Because you’ve exchanged contracts, you’re most likely committed to the transaction at this point. Before you exchange contracts, see whether you can include a get-out clause.

Make Sure Everything Is Finished

Don’t feel obligated to move in before it is finished to your satisfaction. Most developers will not give you access to the property to conduct a report before closing, but this is something that should be challenged. Whether you want to evaluate the property yourself, bring a surveyor in to do a thorough inspection, or hire a snagging inspector, you’ll want to make sure it’s finished to a high quality.