Let’s face it, spending a huge amount of money on a property can be exhilarating; especially when you get to tailor the finishing touches.
Off-the-plan properties are great because on paper they are the best thing since sliced bread, but if you’re not careful you can end up in a bit of unnecessary distress.
It’s key to not forget that there are several moving parts to the process of buying a house though, and these need to line up correctly for things to be successful.
Here are three top tips which may help to ensure off-the-plan transactions have a positive outcome for you.
1. Make sure the contract is correct
This may seem a little obvious, but it is a common mistake made by many in real estate situations. Signing a contract which states it is ‘subject to finance’ is to your benefit.
An ‘unconditional contract’ will tie you in to a situation and then the bank may decide not to lend you the money. This could leave you in a potentially sticky situation, especially before a formal valuation has been completed.
It is also super important to be aware of the fact that some contracts do not always allow you to sell a property before completion. When having the contract written up, it is in your favour to ask for this kind of clause to be deleted or revised.
2. Stalk the developer
Gone are the days of private investigators – especially with the advent of search engines such as Google and, err, the other ones. You should stalk the developer of your off-the-plan property. Here’s why.
Many buyers don’t research the developer enough before buying. This is a key point in the process of buying off-the-plan. A quick search of the company name should yield any nasty hidden surprises such as “company leaves homes uncomplete” and such like. Trust me, it happens.
As well as wanting to see if the developer will complete the project, you will want to know what’s what in case they go bankrupt. This will give you some idea of where you stand in terms of your deposit.
In case there is a risk that you don’t end up with the finished product you envisaged, a Google search should help to reassure, or turn you off. If you can get hold of the schedule of finish too, you’ll be at an advantage here.
As you’re potentially investing in a new-build, why not take the time to visit the site in real life? This way you’ll be able to assess whether it is a good investment or not. Doing this also has the benefit of being able to see which direction your unit will face.
3. Find your confidence
Don’t be intimidated by the 10 or 5% deposit. The developer has lots of units to shift and will want to get the deal done as soon as possible. Deposits don’t get released to the developer by the agent, so there should be no problem here.
Sometimes you need to be prepared to do some bargain hunting, and some wheeling and dealing. If you know people who have already purchased in the same development, use this to your advantage. Let the developer know that you’ve been referred by family or a friend. This might help to bring their percentage fee down.