The Benefits of Buying Off the Plan

12 February 2020

To most people, the idea of buying property before construction has even commenced can seem risky and foolish. But, for those who are willing to buy-before-they-try and want to be a part of a new development, the payoff could be big. Here are a few reasons why buying off the plan can land you the house of your dreams…

1)     Move in Ready

One of the biggest perks of buying off the plan is having something that is move-in ready. Forget renovating and taking down walls. Everything is brand new - brand new fixtures and appliances, brand new timber floors, carpet, bathrooms and light fittings! Not only does this mean you can move straight in, put your feet up and enjoy living in your new home on day one, but save on repair costs.

2)     Saving in Stamp Duty & Government Grants

Stamp duty is a required cost when buying property in Australia. When buying off the plan, some buyers may be exempt from paying this concession, which can end up saving them thousands of dollars. You can use a Stamp Duty calculator to figure out how much money you could potentially pay.

Most states provide First Home Owners Grants (FHOG) to help encourage First Home Buyers to get into the property market faster, by supporting 10,000 low-deposit home loans per year. The attraction is that this new scheme allows first home buyers to purchase a home with as little as a 5% deposit. The National Housing Finance and Investment Corporation (NHFIC) has committed to cover the remaining 15% of the property’s value for eligible candidates.

3)     Small Cost Up Front and More Time to Save

Most developers will ask you to put down a small initial deposit to take the property off the market, followed by either a 5% or 10% deposit to exchange. From there, settlements are usually drawn out until the build is complete – this can sometimes be 6-12 months away depending on the size of the build. This allows you to have a bit more breathing space to get your finances in order, save up, and the possibility of potential capital gains.

4)     Get in Early

If you get in early, you may have the flexibility to choose your ideal location from several different places within the development. For example, you may prefer to be closer to the ponds and neighborhood park, or face onto the community gardens. Another key benefit is that occasionally the developer will provide purchasers with two or three different colour schemes – light, medium and dark. Depending on what you’re after, you may have the opportunity to select your preference.