Buying off-plan
Off-plan property investment involves buying a property before or during its build phase. (Literally, you are buying a property off the developer’s plans.) Developers are usually prepared to discount property bought in this way as it gives them security that their project will be successful and lets them fund additional developments without waiting for the completion of build.
Off-plan is the biggest new trend in property investment so far this decade. It’s easy to see why – you can secure a discount on the ‘completed’ price and you won’t need to spend time or money on refurbishment. If you’re in the right place, it’s possible to capitalise on growth in the marketplace during the development phase – reaping a profit before the developer has even left the site.
If it was always that easy though, everyone would do it. There’s some crucial knowledge you need before signing up to an off-plan purchase. For example, how many of the properties are being sold to other property investors? If it’s a majority, you’ll have to compete for that all-important profit or tenant.
You also need to check out the maintenance costs if you’re buying in an apartment block. While the gym, swimming pool and 24-hour porter service might look attractive to a tenant, you will be responsible for the charges. You also need to make sure that build happens to the agreed specification. Often this involves detailed ‘snagging’ to make sure that when you take possession of the property it is ready for rental without delay.
If you’re looking to get an insight into buying off-plan, Inside Track has helped thousands of investors gain from this type of investment. Our free 2-hour Investment Property Workshop will illustrate how – and show you how to size up an off-plan opportunity.