How to: Find an off the plan property

How to: Find an off the plan property
Nicola TrotmanDecember 17, 2020

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Finding the right off the plan apartment is no easy task, as potential investors are saturated with new development options, all offering unique features and incentives to get them on board.

In order to find an off the plan development that is right for your needs, you will need to undertake some necessary research.

Firstly, research the location you are looking at investing in. In order to avoid potentially buying into an oversupplied area, check pending developments and applications in the area. When a market becomes oversupplied, values can drop sharply, as can rental rates.

Ask, does the area have the necessary infrastructure in place, and are there good amenities nearby? It’s important to check with the local council on future plans for the area if it is lacking these things.

Property Searchers managing partner Scott McGeever says the surrounding developments need to keep with the subject development. That is, if you’re buying into a low-rise complex, there should be no high rises nearby.

“The development should also be close to good amenities and have commercial or retail facilities close by – but not be on top of,” says McGeever.

If you’re planning on buying then letting out the property, check with local real estate agents about the demand in the area and what type of people rent. For example professional couples, single dwellers or families.

Another crucial step is researching the developers, architects and builders and their history. Have they delivered past projects on time? Do they have a good track record of delivering quality developments and how are they tracking financially? This research is important in avoiding a potential investment pitfall.

The next important step is to inspect the display suite.

“Viewing and/or buying an off the plan property is difficult to get your head around from looking at a floor plan and sample board,” McGeever says.

“For this reason, many people make the mistake of thinking bedrooms are bigger than what they are, based on the bedroom in a floor plan depicting a double bed or a couch and dining table laid out in a combined lounge/dining area.

“The reality when standing in the completed unit is quite different as they never seem as big as the floor plan depicted,” he says.

A bonus to buying off the plan is working out what you can ask for and change about the plans to suit yourself.

Holding Redlich partner and property law expert Carolyn Chudleigh says the best way to protect yourself from a nasty shock is to check every detail on the sale contract, particularly regarding the property’s finishes.

“Know everything about the interior, down to how many power points there will be in every room,” she says.

“All of this can be negotiated before exchange of contracts and should be included specifically in the contract if you want to be able to enforce performance against the vendor.

“If a contract is skinny on detail, there may be little room for complaints at the end of the day.”

Lastly, McGeever recommends buying into a small low-rise complex with no lift and low body corporate fees.

Apartments with better aspects and views will most likely attract a higher rental yield and McGeever recommends that all living areas of the unit are orientated away from the west or south and have a sensible layout.

 

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Nicola Trotman

With a penchant for the written word, Nicola has built a career doing just this – now Creative Director at thriving Melbourne-based PR agency, Greenpoint Media.

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