Why buy off the plan?

It would seem that there are many clients who are still wary about buying 'off the plan'.  This seems to come largely from a number of developers who were unscrupulous during the boom period prior to the GFC.  By and large, the GFC has flushed out the unsavoury operators.  The businesses that were able to withstand the assault of the GFC, especially in the construction industry, for the most part, were good businesses prior and are still strong businesses today. However, a large part of the research that we do at Calla Property is into the developers, architects and suppliers of any off the plan development that is referred to clients.  We are not aligned with developers in a personal or business sense outside of what is presented to clients. When evaluating investment opportunities, there are two sides to the coin - opportunity and risk. We believe that if the due diligence is done correctly that the opportunities well out-number the risks and this is why: LOCKING IN TODAY'S PRICE FOR TOMORROW'S PAYMENTS - One of the main advantages of buying off the plan is that you are able to lock in the price of the property with just a small deposit. This allows you to get into the property market without the cost. In the time it takes to complete, you should have also experienced capital growth. CAPITAL GROWTH - By speaking to the right advisors, the people who really understand property markets, like Calla Property, you will have the best chance at picking the right times to invest.  By doing so, with 'off the plan' property, you have the benefit of locking in the price, as well as experiencing capital growth, so that once the property is completed, you've already increased your wealth. HOLDING COSTS - All newly built properties in Australia come with a 7 year builder's guarantee. Any structural or interior building faults must be repaired by the builder.  This ensures that your holding costs are as predictable as possible for almost 10 years - 2 years development lag + building guarantee. This is an important factor for investors who are seeking to extract the most value over the period of the investment. LOW RISK - All money paid to a developer, so the holding cost and the deposit, are put into trust accounts that the developer can't touch until the property is built. This means that it is detrimental to delay building, so developers have a better track record now of completing on or before schedule and if anything else goes wrong, your money is safe. TAX ADVANTAGES - When you're purchasing for investment you should also be able to claim for depreciation. Many builders build specifically for investment so as to claim the most possible in the first years. STAMP DUTY - Certain states offer stamp duty concessions when buying off the plan which can save you thousands of dollars. So let the experts do the due diligence so that the risk of investing in off the plan property is minimised so that you can capitalise on the opportunities outlined above. Call today for an appointment to discuss further. 02) 9016 2852

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