New Real Estate Projects - What to consider before you buy
Posted on: 06 November 2018 by Dan Henderson
What to consider before deciding whether buying in a new off the plan project is right for you.
These days buying property in new off the plan residential projects is becoming a more and more common practice for a lot of end users as well as investors.
There are many reasons behind this trend but a few in particular which are the biggest drivers. Now more then ever it’s increasingly easier to buy in a new, never before seen project. Thanks to the use of new technology, buyers can see 3D renders and simulations of the property they are considering. This is, in turn, making buyers more comfortable with buying something they can't feel or touch as they no longer need to visualize what the end product will look like.
Outside of this buying off the plan property also offers a far more affordable way to enter the property market. This is due to the fact that buying off plan only requires a 5% deposit with the remaining payment due during and in some cases 2 or 3 years after handover.
So, before you purchase property off the plan, there are a number of very important questions you need to consider and ask first to ensure you buy exactly what you intended. Let's have a look at some of those questions in more detail:
What exactly is a new off the plan project?
A new off the plan property is a property which has yet to be built, or is currently under construction. Most of the time when buyers buy off plan the only tangible aspect they can see is the property plot/location.
Are there any dangers in buying in a new project?
Buying in a new project is a very safe investment choice but that’s not to say you still don’t need to do your due diligence. Just like with any financial investment it is important you do your thorough research first, know who you are buying from and exactly what you are buying. Talk to previous customers and take a look at previous project delivered by the developer you are considering buying from.
How do I pay for a new project?
Buyers of new residential projects typically require a 5% deposit to secure the property. Once the deposit is paid there remaining payment due will be paid during the construction period and in some cases a number of years after actual handover.
Are there any ongoing fees that I need to know about?
Outside of the costs associated with the purchase of your apartment or a villa there is one other ongoing fee you need to keep in mind. This is often referred to as a maintenance fee and as the name would suggest is a fee paid towards the upkeep of the building and common facilities. The maintenance fee applicable is calculated based on the property size and will vary from one development to another. The more facilities there are the higher the maintenance fee will usually be.
What are the advantages of buying in an off the plan project?
There are a number of unique advantages of buying an off the plan property. Firstly, they tend to be better priced when compared to an established property. Secondly, the process of buying an off the plan property is much more simple than buying a ready property. In fact, the whole transaction can be done online in some instances.
Whether buying off the plan or not is the right thing for you will really depend on your personal circumstances and investment goals. Either way, it pays to ask the right questions which will not only help you make the right decision but also ensure your next real estate investment is a positive one.