With new developments either underway or being proposed in many parts of Australia, opportunities to purchase apartments and units off-the-plan look set to increase in both our capital cities and regional cities.
Buying off-the-plan was often considered to be the domain of investors however, with the massive boom being experienced in apartment and unit development, this means that more owner occupiers and first-time home buyers are buying off-the-plan.
This article sets out to explain the meaning buying off-the-plan and the advantages and disadvantages of buying off-the-plan.
rnWhat does Buying Off-the-Plan mean?
Buying an apartment or unit off-the-plan means viewing the design and building plans, without being able to physically see or inspect the property. You are also required to sign a contract to purchase an apartment or unit that is, yet to be built.
rnAdvantages of Buying Off-the-Plan
Buying off-the-plan can offer significant advantages, such as:
• You have longer to shop around for the home loan that best suits your needs and circumstances;
• You have more time to save for your apartment or unit, particularly if it has not as yet started to be built. This means you may not need to borrow as much;
• You only need to put down a deposit to secure the property, at today’s price;
• If you are a first-time home buyer and you are considering buying off-the-plan, then in most states buying off-the-plan can incur considerable stamp duty savings;
• You may find that capital growth on the property you are buying, can occur prior to settlement as most developers offer lower prices and financial incentives to get in on the project early; and
• If you are a property investor, buying off-the-plan can also have some extra tax advantages. You may be able to claim depreciation on your tax for items such as furniture and fittings so, you may find that some of the costs can be recouped over time. (But, this does differ from person to person according to circumstances, so it is very important to consult with a tax accountant to find out more).
Disadvantages of Buying Off-the-Plan
Buying off-the-plan can offer significant disadvantages, such as:
• You cannot move into your apartment or unit immediately. You may even have to wait a couple of years for it to be built;
• You cannot walk through and get a feel of the property and be able to see exactly what it looks like;
• You won’t know until you move in, if your neighbors can stare out of their windows and look at you sitting in your lounge room;
• Some developers may spend years deciding as to when and if they will go ahead with the development. You may find your deposit and future living plans being tied up;
• Your situation may even change as a result of losing your job, having a child, getting married or getting divorced, but you may find that you could still be financially obliged to settle.
Now that you have read this article, you may find that buying off-the-plan gives you a much more satisfactory result than buying an established home because, you have the opportunity to negotiate with the developer on such things as:
• Price of your apartment or unit;
• What is included in your property; and
• How the finished property will look.
rnSeek Expert and Professional Advice
Buying a property is likely to be the most expensive investment of your life so, if you are purchasing property off-the-plan. It is always advisable that before signing any documents or paying money, that you seek expert legal and tax accounting advice as well as seeking help from an expert and professionally qualified finance broker or credit adviser.
http://www.singhfinance.com.au is a reputed Australian finance brokerage firm that employs a team of expert and professionally qualified finance brokers.
Their finance brokers are home loan experts and they:
• Know what the standard requirements are for buying property off-the-plan;
• Know what the credit policies and procedures are for numerous lenders/credit providers as they deal with them on a regular daily basis;
• Can determine your overall serviceability position; and
• Can calculate how much you can borrow?
rnIf you want to buy property off-the-plan and you are looking for a suitable home loan contact Singh Finance today and their professionally qualified finance brokers/home loan experts will start working for you. For an obligation-free assessment, call on 0424 190 908 today or visit their website and simply click on the "ENQUIRE ONLINE" form.
rnDisclaimer: This article is of a general nature only and does not constitute professional advice. I strongly recommend that you seek your own professional legal and accounting advice in relation to your particular circumstances.