As apartment developments are popping up left, right and centre, the term ‘off the plan’ is increasingly prominent. These apartments, offered to buyers before construction has commenced or completed, are generally listed at a cheaper rate with incentives sometimes pinned on. Here, we look at the upsides of buying off the plan and what it all means. Buying an off the plan apartment is ultimately “buying sight unseen”, according to John Carfi, chief executive officer of Mirvac Residential. Therefore it’s important to buy from a reputable developer and builder with a good track record.
“Off the plan properties can deliver great returns to investors, providing a stable rental income, the potential for capital gain and tax benefits through depreciation and negative gearing,” Carfi says. Carfi says a well-designed property, which has a high level of amenity and is close to infrastructure such as public transport, schools, shops and open space, is more likely to attract a higher rent and be easy to let. If you’re planning on buying off the plan, you should always research the area and contact the local council to get an understanding of the area zoning and any pending development applications, to avoid investing in a development jungle.
Buying off the plan generally, but not always, means buying at a better price. “When developers first offer their new projects they often offer them at discounted prices in order to secure required pre-sales for the bank,” says Ross Le Quesne mortgage broker at Aussie Home Loans
