As Australia’s population is forecasted to grow a further 1.5 million in the next five years, the demand for housing will inevitably soar, creating the perfect opportunity for investors.
Buying a property off the plan means you’re getting in on a property deal before it’s built. Investing in this way allows investors to score a property for less and see its value increase once the property is ready.
But what is off-the-plan property really? And what are the factors you need to keep in mind if you’re considering buying off-the-plan.
So what exactly is off-the-plan property?
Off-the-plan property is just that, off the plan. Purchasers can view the plans for the property on paper, but since it hasn’t been built yet you can’t see a physical property. This way of purchasing a home is particularly popular for new build apartments and homes that are purchased within housing estates that are yet to be built.
Generally speaking if buying off-the-plan property you would pay a 10% deposit to begin construction, and then would pay the remaining balance once the build is complete. This process can take anywhere from a couple of months to a couple of years, with homes generally getting completed faster than apartments.
What are the benefits of buying off-the-plan?
When looking at buying an off-the-plan property, there are some things you should definitely consider, one of those things is the various benefits of using this option to purchase property.
Below we have compiled a list of some of the potential benefits you may experience if you chose to purchase a property off-the-plan.
Better investments:
If you’re shopping for an investment property with the intention of renting that property out to a tenant or using it as a possible location for short-term holiday rentals, brand new properties are becoming far more popular with renters.
If you’ve got a brand new property available for rent you may end up with a larger number of prospective tenants.
Better for your money:
We all know buying a property isn’t cheap and the benefit with buying a property off-the-plan is that you can get your foot in the door by paying a small deposit, and then use the time it takes for your property to be built to save the rest of the money needed. Buying a property off-the-plan gives you the added time you need to save!
The other monetary benefit of buying off-the-plan is that generally construction companies have a quota they need to sell before they begin the build, so if you get in early you can typically snag a much better deal than if you were purchasing an already built or already established property.
Added choice & customisation:
Depending on the type of property you’re buying, buying off-the-plan gives you the opportunity to fully customise your new home! From flooring to finishes, when a property is built from scratch there is so much more opportunity for you to make it really feel like yours!
Tax depreciation benefits:
When you own a property, it will experience wear and tear. If you’re purchasing off-the-plan for an investment property, current legislation allows you to claim this everyday wear and tear as a tax deduction called depreciation. If you buy off-the-plan you can yield greater tax depreciation benefits than if you bought an established property due to wear and tear.
There are many benefits to buying a property off-the-plan, especially if you are looking for an investment property.
For more information on purchasing property off-the-plan, simply fill out the form below to request a no-obligation, 45-minute consultation with one of our property experts valued at $495 absolutely free!