{"id":13807,"date":"2017-09-19T03:00:31","date_gmt":"2017-09-18T17:00:31","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=13807"},"modified":"2017-09-19T03:00:31","modified_gmt":"2017-09-18T17:00:31","slug":"a-beginners-guide-to-buying-off-the-plan","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/a-beginners-guide-to-buying-off-the-plan\/","title":{"rendered":"A beginner\u2019s guide to buying off the plan"},"content":{"rendered":"<p>We all know that Sydney has stolen all the property headlines over recent years, but there has been another big news story happening at the same time.<br \/>\nWhat is it?<br \/>\nIt\u2019s buying off the plan \u2013 and buying new units in particular.<br \/>\nOur property markets are changing, from one where the Great Australia Dream revolved around buying a house, to one where more and more people are planning for apartment living.<br \/>\nIn Sydney, as our most populous city, more new apartments than houses have been built\u00a0<a href=\"http:\/\/www.smh.com.au\/nsw\/biggest-housing-construction-boom-in-sydneys-history-on-the-way-20161118-gsspwo.html\" target=\"_blank\" rel=\"noopener noreferrer\">since the early 1990s<\/a>.<br \/>\nBut that only started to happen in Melbourne and Brisbane over the past few years, and it\u2019s unlikely to go back to the way it used to be.<br \/>\nThere is a myriad of\u00a0reasons why our nation is moving into a country of more apartment-dwellers (like so many others around the globe) \u2013 including population growth, more single households, fewer children as well as affordability considerations.<br \/>\nBut buying off-the-plan can be more complicated than buying an established house or unit.<br \/>\nSo, let\u2019s take a look at the buying off the plan process to understand all the pros and all the cons.<\/p>\n<h3>The benefits of buying off the plan<\/h3>\n<p>Everyone likes new stuff, don\u2019t they?<br \/>\nWhether it\u2019s a new car, new shoes or a new property, there is something alluring about being the very first owner of something.<br \/>\nIt\u2019s shiny and new, without any wear and tear whatsoever.<br \/>\nAnd that is one of the major\u00a0<a href=\"https:\/\/www.domain.com.au\/advice\/is-buying-off-the-plan-a-good-investment\/\" target=\"_blank\" rel=\"noopener noreferrer\">benefits of buying off the plan<\/a>\u00a0\u2013 you will become the proud owner of a brand-new house or apartment.<br \/>\n<a href=\"http:\/\/intuitivefinance.com.au\/8-things-to-consider-when-making-a-property-investment\/\" target=\"_blank\" rel=\"noopener noreferrer\">Owning a new rental property<\/a>\u00a0brings with it numerous advantages, including:<\/p>\n<ul>\n<li>Tenants are generally attracted to new properties<\/li>\n<li>You can usually charge a higher rent because of its newness and mod cons<\/li>\n<li>There are ample depreciation benefits<\/li>\n<li>Various exemptions on stamp duty, as well as grants, exist for first homebuyers specifically of new properties across the country.<\/li>\n<\/ul>\n<h3>The risks of buying off the plan<\/h3>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-13808 aligncenter\" src=\"https:\/\/i0.wp.com\/realestatetalk.com.au\/wp-content\/uploads\/2017\/09\/image-3-IF.jpg?resize=300%2C300\" alt=\"\" width=\"300\" height=\"300\" \/><br \/>\nSo, there are a number of benefits with the buying off the plan process, but there are some risks as well.<br \/>\nOne of the major\u00a0<a href=\"https:\/\/www.commbank.com.au\/guidance\/property\/buying-property-off-the-plan-201701.html\" target=\"_blank\" rel=\"noopener noreferrer\">buying off the plan risks<\/a>\u00a0can be settlement risk, which is an issue that is currently in the news.<br \/>\nThat\u2019s because the off the plan settlement process involves paying for the property months and years after you have signed the sales contract.<br \/>\nWhile the property market is generally a slow-moving beast, outside intervention can change the goalposts rapidly such as the\u00a0<a href=\"http:\/\/intuitivefinance.com.au\/interest-only-lending-benefit-from-softer-conditions\/\" target=\"_blank\" rel=\"noopener noreferrer\">recent APRA changes<\/a>\u00a0.<br \/>\nAlso, because apartment buildings take many years from approval to completion, the market can go from being normal to oversupplied in that period of time.<br \/>\nAnd the price that you agreed to pay on the contract may not be the official \u201cvalue\u201d some two or more years later.<br \/>\nAnd guess what?<br \/>\nYou still have to settle, which often means you either have to come up with the shortfall or you attempt to sell before settlement.<br \/>\nEither way, you can wind up wearing the loss because of the change in the market from when you first bought the property to when it was finally finished.<br \/>\nAnother risk is one of quality. The best way to describe this is\u2026 have you ever bought some clothing online and when it arrives it\u2019s nothing like the pictures?<br \/>\nIt\u2019s exactly the same with the buying off the plan process.<br \/>\nThose pretty pictures of what your new property is supposed to look like might not be entirely representative of the end product \u2013 although there is legislation to protect consumers in this regard.<br \/>\nAnother buying off the plan risk is that the builder and developer might go bust during the construction process and it can be tricky to get your deposit back.<\/p>\n<h3>Questions to ask before you sign the contract<\/h3>\n<p><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-13809 aligncenter\" src=\"https:\/\/i0.wp.com\/realestatetalk.com.au\/wp-content\/uploads\/2017\/09\/how-what-when.jpg?resize=292%2C300\" alt=\"\" width=\"292\" height=\"300\" \/><br \/>\nThere a number of questions to ask when buying off the plan \u2013 and especially before you sign the contract!<br \/>\nThe contract itself can seem a little daunting because it is usually just larger than a more traditional sales contract.<br \/>\nThat\u2019s because, of course, not only are you signing a contract to buy a property, you\u2019re also signing a building contract, too.<br \/>\nEnsuring you have legal advice before you sign the contract is vital, so it\u2019s a good idea to have your legal representative review the contract before signing.<br \/>\nNot only will they check that the builder or developer is committing to construct what you\u2019ve verbally agreed on during the buying off the plan process, they can also double-check the finer details.<br \/>\nAn example of a lawyer\u2019s vital role was the contract of one off the plan buyer, where the building plans didn\u2019t reflect what the purchaser believed they were buying. In fact, what was supposed to be a 20 square metre outdoor area was not shown in the plans at all.<br \/>\nWhile it was an oversight, if they had signed the contract, it would have been more difficult for them to get what they thought they were paying for.<br \/>\n<a href=\"http:\/\/www.realestate.com.au\/advice\/8-common-questions-when-buying-off-the-plan\/\" target=\"_blank\" rel=\"noopener noreferrer\">Before signing an off the plan contract<\/a>, other questions to ask include:<\/p>\n<ul>\n<li>Will the property look exactly like these illustrations or this display suite, including finishes and colour scheme?<\/li>\n<li>When is the expected completion date of the project?<\/li>\n<li>What happens to my 10 per cent deposit?<\/li>\n<li>How much will the strata or body corporate fees be?<\/li>\n<li>What is a rental guarantee?<\/li>\n<\/ul>\n<p><em>Disclaimer:<\/em><br \/>\n<em>The information provided in this article is general in nature and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information with regard to your objectives, financial situation and needs.<\/em><br \/>\n<em>This article was originally published on <\/em><a href=\"http:\/\/intuitivefinance.com.au\/beginners-guide-buying-off-the-plan\/\" target=\"_blank\" rel=\"noopener noreferrer\"><em>Intuitive Finance<\/em><\/a><em>. <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>We all know that Sydney has stolen all the property headlines over recent years, but there has been another big news story happening at the same time. What is it? It\u2019s buying off the plan \u2013 and buying new units in particular. Our property markets&#8230;<\/p>\n","protected":false},"author":176692471,"featured_media":13891,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2,32,13,36],"tags":[70],"class_list":["post-13807","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-andrew-mirams","category-buying-a-property-topic","category-latest-story","category-property-investment-topic","tag-featured"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>A beginner\u2019s guide to buying off the plan - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/a-beginners-guide-to-buying-off-the-plan\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A beginner\u2019s guide to buying off the plan - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"We all know that Sydney has stolen all the property headlines over recent years, but there has been another big news story happening at the same time. 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