When it comes to buying a new home, there are plenty of choices to select from. These days, a number of people are interested in buying off the plan – where you purchase a dwelling that hasn’t yet been built. With no physical property for you to inspect, you see the proposed plan and designs on paper and through pictures. One of the biggest advantages of buying a house off the plan is that you will be the first owner of the property and get a brand new dwelling built just for you. Depending on what stage you buy the property you can also influence the colours, fixtures and other finishes on your home.
Benefits of Buying Off the Plan
There are quite a few benefits of buying a new home off the plan. These include:
When you buy off the plan you pay the current market value, which may rise in the future when the construction is completed. When you sign the contract with the developer, you are usually required to pay a 10 percent deposit of the total price of the property. The remainder of the balance will be paid upon completion, which may take months or years. As a result, you have ample time to organise your finances and personal affairs such as selling your existing home. As the property value may rise in the future, you may also benefit from the difference in the lower price you paid initially and what the property is valued at upon completion (depending on whether the market has risen). This is known as equity. So if the market has risen and your property is worth more than what you paid for it, you have gained some equity in the property.
- Secure A Quality Property
If you act quickly enough you can often secure a quality property, perhaps the best on offer in the development, with only a 10 percent initial deposit. The balance will be paid on completion of construction. In the meantime, you can enjoy the benefit of any capital growth on the property.
- Tax Benefits
There are significant tax benefits when buying a property off the plan, as many state governments offer stamp duty savings and incentives for buying newly built homes. You can often enjoy higher tax deductions via depreciation allowances. The benefits are greater when the property is new, so when you buy off the plan, it can maximise your tax deductions.
- Your taste
When buying off the plan, you have greater choice in deciding the design, furnishing, fixture, finishes, colours, and layouts. You may be able to custom design the property. So you can purchase a property with a superior position, floor plan and finish. As a result, your property has greater potential for strong capital growth.
While you are often required to pay the initial deposit of 10 percent when you sign the contract, you can use the extra time before final settlement to save money. What’s more, you can enjoy the benefits of any capital growth that may occur during the period.
With ample time before final settlement you can avoid the stress involved in getting things in order before you actually move in. Things like selling your existing house or ending a lease take time to sort out, so having plenty of time to get ready can help minimise the impact of these when it comes time to move in to your sparkling new home.
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