Buying Off The Plan – What Every Property Investor Needs to Know...
Understanding Off Plan Property
If you are looking to invest in off the plan property, consider that it can pose a number of risks and advantages. This kind of investment strategy can really work for you, as long as you are smart about how you go about choosing the property. Working with the right developers is an important first step.
Understanding what off plan is, and how it can be so beneficial is important. Basically, off plan property is when you purchase a property before it has been built. You may notice adverts in the newspaper for apartment blocks or houses for sale that haven’t even started with the early construction phases.
People will choose this property based on architectural impressions of what the place will look like when it’s done. You will be presented with a realistic and detailed plan for the place, alongside artistic drawings of what it will eventually be like. You then buy the property and wait until it is completed.
The strategy taken to invest off the plan has proven to be very beneficial for many. There are several useful advantages and money-saving tactics that present themselves when using your money this way.
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Why Invest Off The Plan?
Some people don’t understand how you can buy a property before it exists. However, if you realise how this can help you – it does make total sense. The main drawcard to this kind of buying strategy is that there is huge potential for your investment to increase by the time you are ready to move in. The other major appeal is that you will get a brand new property for possibly below market value, and you will pay less on stamp duty.
You could either go for this buying strategy as someone that plans on living in the property, or someone that is purely investing. If it is the first option, off plan property is not always favoured. This is because you don’t really get to experience exactly what your home will be like – and you don’t want to run into any unenjoyable surprises. However, as a property investor, the outlook looks a lot more positive.
Benefits of Buying Off The Plan
Many investors swear by taking the invest off the plan route, as it can be a smart way of growing your properties value. Here is a look at some advantages to purchasing property this way.
Save Money on Stamp Duty
When you invest off the plan, you will be signing a contract before construction begins. This means that your stamp value will only apply to the land value, and not the finished development. Most states will offer greater discounts on newly built properties. This means that you could save a great deal of money through stamp duty discounts when you purchase off plan property.
Potential to Purchase Under Market Value
Developers sell off plan property to help cover their initial construction and development costs. Buying a property in advance often results in paying a much lower price than what the property will be valued at after construction. This means that when your place has finished being built, you could enjoy a property valued at more than you paid for straight from the start.
Anyone planning on leasing out their property can enjoy tax deductions available via depreciation. Maximising these can be a significant money saver.
Buyers Get More Time
To secure this kind of contract, you will usually have to pay a deposit of around 10% in advance. There will still be a fairly long construction time after this, which allows you to take longer to save up and get your finances in order.
Brand New Properties
The idea that you will get a brand new, unlived in property is a huge appeal to off plan buyers. When choosing the space, you can often add a few customisations into the planning to make sure that it is suitable for your tastes. Once the building phase is over, you will get to enjoy a brand new property.
Choosing Off Plan Property Developers
If you are interested in pursuing an off plan development, then make sure that you work with the right people. At Silkwood Homes, we can help turn your property dreams into reality. Get in touch today if you would like to find out more about what we can offer. Or take a look at our exclusive design catalogue and find the perfect off the plan investment option for you.
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