Buying Off The Plan In Melbourne? Let’s Discuss!
Melbourne’s Off-the-plan developments get a bad rap, but there are many advantages for buyers that aren’t widely known.
First, let’s look at what it means to buy off the plan in order to see if it’s a good idea.
First, what does “buying off the plan” actually mean?
When you sign a contract to purchase an apartment that has not yet been constructed or is still being constructed, you are buying off the plan.
Customers must rely on plans and artistic renderings of the apartment’s design, as well as information about the project and its developer, to make their purchase decision without having access to the actual property.
Second, what are the benefits of buying off the plan apartment?
Buying off the plan has the advantage of allowing you to agree on a purchase price before they even construct the building and this only takes a small deposit of 10% in most cases.
It’s possible that the price of a property could rise significantly in the time it takes for the developer to construct your new property. So buying off the plan could be an excellent opportunity to jump on, considering all the risks and market conditions.
Third, what are the offered stamp duty rebates?
If you buy off the plan, you can save a lot of money on stamp duty because some states give larger discounts on newly constructed properties for owner-occupiers.
Fourth, what is the property’s condition?
Another benefit of buying off the plan is that the apartments will be more energy efficient and in better condition than many older ones, so you won’t have to spend as much money on repairs and utility bills in the months and years to come.
Fifth, how off-the-plan buying can help you in saving the required finances?
You’ll have more time to get your finances in order if you buy off the plan, because you only need to put down a 10% deposit to secure the contract, and you can use the extra time to save up the remaining balance during construction.
Lastly, what are the benefits to the taxpayer?
In addition, if you plan to rent out the apartment, buying a new property off the plan will allow you to maximise your tax deductions through depreciation if you are an investor.
Occasionally, investors give off-market transactions a negative reputation, claiming buyers risk paying too much. We completely understand that asking people to pay hundreds of thousands of dollars for something that does not yet exist may seem absurd… But this method of purchasing is gaining popularity and allowing people to own their dream property. It is crucial to keep these things in mind when making up plans to buy an investment property!
Here are seven good reasons to buy off-the-plan property in Melbourne:
1. Savings on repair costs
If you purchase a brand-new home that was constructed to the highest quality standards, it will not require the initial or ongoing maintenance that older properties almost always require.
2. Lower power bills
Changes to the Australian Building Code cause new properties to meet stringent energy efficiency standards. Your off-the-plan home must be equipped with some of the most energy-efficient appliances. Along with gas/water/electricity systems on the market, which is a power-saving benefit for you as a buyer. And, if you plan to rent out your home after a year, a benefit for your future tenants as well. This is one of the significant reasons for buying off the plan in Melbourne.
3. Potential capital gains
When purchasing off-plan, if you buy with the correct guidance and at the right time, you can benefit from under-market value prices, meaning that your property will have space for potential instant growth.
We’ve had clients whose properties increased in value by between $40,000 and $100,000 over one to three years. This type of capital growth is potent and can enable you to buy another property and begin building a property portfolio.
Typically, we always recommend viewing capital gains as a “little bonus”. They should never be your primary motivation for purchasing off-the-plan. Read our latest blog, The 7 Best Australian Cities To Live In to find out the other cities where you can buy off-the-plan.
4. It buys you extra time to save.
Pre-construction purchases are attractive to first-time buyers as they are one of the simplest ways to enter the property market.
For starters, you only need a 10% down payment, and you can pay the remaining balance of the purchase price upon completion of construction. (In terms of duration, a construction project can take between six months and two years to complete.
This provides you with additional time to save money for your moving expenses, furniture, and housewarming party.
And the more you save during this period, the less you will need to borrow, resulting in much lower loan payments.
5. It is convenient for all the activities you enjoy.
Typically, developments are near public transportation, within a community with a robust shopping district, parks, and schools. They do this because they want people to live a quality lifestyle.
6. Increased rental yield
When investing in brand new properties, you usually get higher rentals. As tenants prefer to rent modern properties close to where they work or where their lifestyle is.
If you’re interested in exploring buying off the plan in Melbourne, PB Property can guide you at every step.
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