When you think about buying a property, the first thought that might come to mind is ‘where can I find a home that’s affordable and something that suits my financial needs?’ While renting an apartment or purchasing a pre-existing one might be an option for some people, buying a brand new property could also be an alternative.
Working with real estate agents and advisors to understand different options available to invest in real estate properties is advisable. If you are interested in purchasing a property off-the-plan, this article covers everything you need to know about it. Here are some things to consider before making this kind of investment.
What Is an Off-The-Plan Property?
The term ‘off the plan’ refers to the sale of new construction, and the property is not ready for occupancy yet. Therefore, it is important to understand that you will be purchasing a property that is under construction, where all the finishing work is yet to be completed.
This is just one of the many similarities between pre-existing properties and off-the-plan ones. For example, when you buy a pre-existing apartment, it is fully furnished, and you can move in as soon as you have registered with the owner.
On the other hand, when you purchase an off-the-plan apartment, the construction is still in progress, and you will have to wait until the construction is completed until you can move in.
How Is an Off-The-Plan Property Different from an Existing Property?
The main difference between buying an off-the-plan and existing property is that you are purchasing a property that is yet to be developed. The existing property is one that is already constructed, and you can move in right away. Agents may use the term ‘off-the-plan’ to refer to existing properties, too, and this often causes confusion among would-be buyers.
That is why it is important to understand the differences between these two types of properties before you consider buying one. – Off-the-plan property:
These are properties that are still under construction, and you will have to wait until the construction is completed before you can move in. – Existing property: These properties are ready for occupancy, and you can move in right away.
What Are the Costs Associated with Buying a Property Off-The-Plan?
As with any other type of real estate purchase, you will have to consider the associated costs when purchasing an off-the-plan property. The good news is that there are various financial incentives available that could help you to lower your expenses when buying this type of property.
In order to receive these government incentives, you will have to go through a mortgage broker to apply for a government-backed loan, and you may also be eligible to benefit from lower interest rates.
There are also other expenses associated with buying a property off-the-plan, such as the cost of applying for the loan, legal fees, and the expenses of hiring a financial advisor or real estate agent to help you make the right decision. Complete Conveyancing Solutions can help you with this. You may also have to make a deposit when you sign a contract to purchase an off-the-plan property.
This deposit is put down as a commitment to purchase the property, and it is not refundable. The amount of deposit varies from one developer to another.
Pros and Cons of Buying a Property Off-The-Plan
A major benefit of buying a property off-the-plan is that you can pick the floor plan, design, and location that you want before it is sold out. This is not an option when you are interested in buying an existing property, and it could be challenging to find a pre-existing apartment that meets your specific needs. Another benefit of buying off-the-plan property is that the price of the unit is likely to go up when it is completed.
This is because the supply of new properties is limited, which could result in increased demand, and, therefore, the price of the property would go up. While there are plenty of advantages to buying an off-the-plan property, there are also some drawbacks that you need to be aware of.
For example, the quality of construction of the property might not be as good as what you would find with an existing property. You may also not know the exact address of the property or the building.
Final Words: Should You Buy a Property Off-The-Plan?
Buying an off-the-plan property is a good way to invest in real estate and secure a home for your family at the same time. You will have to wait until the construction is completed before you can move in, and there is always a risk that the developer may not deliver what was promised.
That is why it is important to do your research, work with a financial advisor, and find a reliable builder or developer before deciding to invest in an off-the-plan property.