Buying off-the-plan property (OTP) can be an easy process. It’s a great way to buy into some of the most in demand areas and even for the first time buyer, buying OTP has lots of advantages.
Should you feel comfortable about buying OTP? The short answer is yes, it’s a tried and tested way to buy and offers a flexible path to purchase. Buying OTP means you have additional time to save between paying your deposit and when your stamp duty is due and repayments begin, your property could benefit from capital growth from the time of purchase to settlement and of course you are purchasing a brand new property.
However, just like any real estate purchase there’s always some helpful tips to keep in mind.
1. Check The Contract
The starting point for any OTP purchase will be the Contract of Sale, and there’s no doubt that these can be a little bit daunting. Make sure you understand all of the key dates and terms in the contract. This includes any attached plans, schedule of finishes and appliances and the sunset clause. The sunset clause is the statement in the contract of sale which refers to the maximum time in which the developer has to complete the project. Depending on the size of the property, this time will vary across developments. If your property is not finished by this time, you are legally entitled to walk away from your contract and receive your deposit back in full. Keep in mind the sunset clause will state the maximum time it will take to complete the project and generally it will be finished well within this time. The time frame can be exaggerated in order to allow for any delays the developer may experience such as inclement weather, industrial action or development funding delays.
It’s essential to understand the key contract dates. Building a new project always involves a complex timeline. There are many different factors that can influence the completion date. If you’re selling or renting while waiting to move, make sure you have ample time to plan your move.
If you’re buying into a Strata Community, get a copy of the Registered By-Laws. If you’re going to be living in a strata community for the first time, go online and visit the various State Government websites that publish all the details you might need.
2. Local Amenities
When buying into a new building that is yet to be constructed, it’s always a good idea to have a clear picture of what services and facilities are in the local area, and what facilities you’re personally looking for. Make a list of ‘must have’ facilities, it pays just to make a simple list, and tick off key features while looking around inspecting different projects.
If you’re moving to a new suburb make sure you get a full appreciation of long-term plans for the area. All our major cities have big growth regions with lots of new services on the drawing board, it’s important to understand what’s in the pipeline and when new infrastructure will be ready. This information is available from the local council.
Easy access to public transport is easily one of the most important aspects of daily life that anyone would need in a new home. It’s easy to check out these facilities by looking up routes and timetables on an app or website. Even plan to take a ride on the local bus, light rale or train network, it’s time well invested. Further more, have a look at what is in the local infrastructure plan and how that will effect you.
The NBN is still being rolled out across the country. If NBN is available in your area, make sure you check the property developer has signed up to have the nbn network delivered to your new home or premises so when you move in you can enjoy the speed and connectivity of the nbn network through your chosen preferred phone or internet provider. You can check if your new address is NBN ready here
5. Rentals Are A Good Guide
We suggest that looking at local rents can be an interesting way of checking if a particular area and building will match your personal needs. Current rents are not only important to investors, but they are a good guide to the quality and demand for a particular neighbourhood.
One quick and easy way of checking how popular an area is to search real estate websites or lifestyle blogs, these digital communities are increasingly popular sources of information on neighbourhoods and a great way to get current information. High rental demand is always a good indicator.
6. Storage... How Much Will You Need?
Storage is a perennial ‘must have’ for almost any apartment buyer, and if you’re buying a house or terrace, remember the garage is for your car and possibly the lawn mower.
Smart internal design is an important thing to look out for. Things like the size of the wardrobe and if there is fixturing for shelves and drawers, storage in the laundry area, large drawers in the kitchen store more items and are easier to access than traditional cupboards. Don’t forget storage for your linen, this is one often forgotten but important for everyday living.
If buying OTP, the marketing plans will be an essential part of the information you need to consider and understand. While reading floor plans is not any everyday task for most people, today professional marketing will always be built around quality and detailed floor plans to best help buyers vision their property. Floor plates are also invaluable for you to see the layout of the floor you’re looking at purchasing on to look at the locations of things like the lifts, stairs, garbage facility room etc.
Once you start to narrow your search, it’s worth allowing enough time to absorb the full details of the plans. This will help you to relate a project to your personal needs and that includes any existing or new furniture.
8. Finishes And Fixtures
A really big benefit of buying OTP is that your new home will be brand spanking new and the choice of finishes is an exciting prospect that most buyers appreciate and enjoy. Take a close look at the display suite, apartment or home and always feel free to compare the optional finish boards. You’ll also find it useful to picture the finishes against any artist’s impressions or CGIs - computer generated images of the finished property.
Almost every new project will have a choice of colours and some finish options, take a close look at what’s available and keep in mind your personal taste and plans for when you move in. It might take a little imagination but there’s plenty of information to help and you will almost always find manufacturers and suppliers have further details online to check out.
Keep street parking and the availability of a car space and visitors parking in mind, as this is an area where different local councils will have varied policies in relation to time limited street parking. Again we suggest you check local council web sites for all the details for the area the development is located in. In some very busy suburbs resident parking permits are not always available.
10. Research The Development Team
By understanding who is behind the development and having a look at some previous projects they have delivered will give confidence in who you are buying from and the level of quality they will deliver. The developer, architect, interior designer and builder are all instrumental to delivery.
11. Ask Questions
When buying OTP always ask questions, because it’s not usually going to be possible to inspect the exact property you are buying. You need to ask questions and consider carefully all of the great marketing material that’s available. Do your homework.
Keep in mind the Colliers Residential team is ready to assist and with every project supply there’s detailed tools and lots of information to help you make your choice, it’s easy to do as much research as you like.