May 12, 2022

Buying a property off-the-plan? Here's what to expect

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Louis Lin

Buying a property off-the-plan? Here's what to expect

Off-the-plan properties have become an increasingly popular way

Buying off-the-plan properties is different from buying an existing property, it’s important for buyers to do research on the development team that delivered the project to understand their past work.

Unlike buying existing properties, buyers of off-the-plan properties need to use their imagination - using the floor plan and the artist's impression of the building as a guide to describing your new home. Fortunately, most off-plan properties have a showroom that you can visit, so you will be able to see all finished samples and learn about the future of your new property.

Buying off-the-plan gives you the opportunity to maximize your investment potential and possibly save on stamp duty. You can reserve a property and then take advantage of rising prices for only a 10% deposit and pay the remaining funds until the construction is completed.


What to expect of buying off-the-plan process?

-       If you fall in love with an off-the-plan property but are not ready to jump straight in, you can usually reserve it for a refundable deposit. This will take the property off the market in 7-14 days (depending on the development) while you decide what to do.

-       Ask the developer to help you select the desired color scheme, fittings and fixtures you want.The options are limited, the color scheme is usually fixed, and you will most likely choose from a "light" or "dark" scheme. The options are varied, depending on the developer and the stage of the project.

-       Next comes the deposit. In most cases, you'll pay 10% of the property value. It's important to note that your bank or lender won't issue a mortgage for you until the construction is completed and they can undertake their own independent valuation, so it's important for buyers to know their lending capability well without getting a pre-approval.

-       The developer will send the contract to your legal representative. You will have time to clarify any items and pay a 10% deposit. It is important to ensure that your solicitor/conveyancer has experience with off-the-plan contracts as they are different from established property contracts.

-       This is great if you are an early buyer, those with the best view and location usually go first.

-       The developer will update the construction regularly once the deposit is paid and the contract is exchanged.

-       You will be invited to attend a pre-settlement inspection, during which you must inspect the work and point out any defects.

-       Typically, you have three months to identify construction defects. Depending on the developer's builder process, the defect liability period may be longer in some cases.

Buying off-the-plan properties are an excellent way to maximize your investment, and now is the time to contact AUV Team to view all of our current off-the-plans.

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