Buy off plan for huge profits
This is the type of headline which lures people in to buying property off-plan. Whilst
off-plan buying can be very lucrative it has to be done with care and you will
have to ask certain questions of yourself and the builders involved.
What is off plan buying?
Simply put it is looking at the builder’s plans of the house and buying
a house before it has been built. Generally you pay a 5 – 10 %
deposit of the agreed price. You may have to wait anything up to 18 months
before the completion of the house. In the 18 months you can expect the
house value to have gone up.
According to DTZ
Residential 60 % of houses bought in England and Wales were off-plan. It
can be a good way to get on the property market ladder and a good way to
get on the property investment ladder.
Advantages
Of course there are advantages and disadvantages to this off plan investing.
- If you buy in the first phase of a development the rise in price will generally
be higher than the national average. - You choose how the inside of your house will look. Most off plan
buyers can choose the kitchens, bathrooms and even alter some of the internal
spec before a brick has been laid. - Covered by a 10 year guarantee from the NHBC
Disadvantages
- Move in date is generally not fixed. Bad weather can hamper the
building of a house, so an exact move in date is generally not fixed. - ‘Investor flooding’ may be a problem. This is when a
high proportion of investors have bought into the estate which you are buying. For
the investor, depending on the area, you will have a lot of competition
on your doorstep.
There are lots of companies who can look for off plan opportunities
for you. My company Axis
Property Investments is one such company, but
have a look around the net and you will find hundreds.
There are risks to buying off plan; however this is true in life. There
are risks to everything we do. If you are a serious investor, or thinking
about property investing, this can be a good area to look at. Off plan
buying abroad is also a huge market and can be good for investors. I
will look at this in another article.
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[...] If you’re in the U.K. and looking to buy a home, check out Rob Thomas’ article on Off-Plan Investing, buying a stock house from a builder long before it’s built. [...]
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[...] Rod Thomas presents Off plan investing posted at Prosperity from Property. [...]