A guide to buying off the plan
Benefits
There are many benefits to buying a property off the plan:
Securing a property now at today’s fixed price with only 10% deposit of the purchase price.
This process gives you time to arrange selling your existing home, save more funds or manage your finances before settlement.
Enquiring in the earlier stage of the process gives you further options between the available floor plans.
Floor plans have been carefully designed by architects to make the best use of space.
Colour schemes and fittings are fixed, making the selection process more streamline.
When buying off the plan you may need to pay Stamp Duty within 3 months of exchanging contracts. Otherwise you may incur interest.
Today’s fixed price
Designer finishes
Time to save
Step by step process
Step 1
Working out your criteria and expectation is important to see if this is the right project for you. Our sales consultant will work towards your time frame, budget, wants and needs. Together, we will go through the following:
Available floor plans
Pricing
Sizes
Levels
Orientation and aspect
Views
Internal and external renders
Colour board samples
Step 2
Once you have selected a property and are ready to move forward, let our team know.
The buying process can change depending on the development so we will guide you through the particular process required for your development. This could be a full 10% deposit or a part deposit - a cash amount paid that holds the property and gives you time to organise a full deposit.
All buying processes have a time frame for you to complete and exchange your contract. This may also include a cooling off period. Always check with your sales agent about these time frames.
Step 3
We will keep you informed and up to date with the construction commencement and progress through the building stages. Once construction is complete, settlement will soon occur and you will receive an occupation certificate when the title for the property has been issued. You will then be required to pay the full balance of the initial purchase price.
To conclude the journey, there will be a handover date to receive your keys and let your new chapter begin!
Sunset date
This is the date by which that the developer is required to complete the project and deliver your product, and will also be within the conditions of any Contract for Sale you sign. You are “locked in” to the project until completion of the project or expiry of the Sunset Date, whichever occurs first. The Developer will always allow more time when setting a Sunset Date than is reasonably anticipated for completion of construction. This is to allow for the unforeseen circumstances that may occur such as bad weather, product delivery delays, unforeseen lockdowns (COVID-19 was one of these), strikes, etc.
Remember, you are taking yourself out of the market once you have purchased off the plan and need to be assured your Project will be completed on time and within Sunset Dates.
What to clarify
Builder
Ask for details of the builder’s track record and ask the Selling Agent to provide information on previous developments undertaken by the proposed builder.
Developer
Sometimes the builder and developer are the same person or entity. If not, ask for information on recent projects completed by the developer. You need confidence that your developer has the skills and financial capacity to complete the project.
Protection
There are several areas of protection for you as an off the plan buyer, including:
You have 10 days cooling off period after signing a contract of sale, which is twice as long as a normal residential purchase.
Developer’s bond - The developer is now required to pay 2.5% of the build price to a Bond Board to be held for 2 years. The intention is to cover genuine defects if the developers refuse to fix them. This applies to developments with a minimum $10 million construction.
Initial Defects Period - 90 days.
Builder’s Defects - 12 months.
Summary of recommendations
Secure finance
Ensure your finances are secure and will be available in the future when you are required to settle.
Legal advice
Seek quality legal advice on the contract you are signing.
Builders and developers
If possible, buy from experienced and recognised builders and developers.
DA approval
Buy in a project that has DA approval from Council, NOT “subject to DA”.
Confirm dates
Get a clear, firm indication upfront of the expected starting and completion dates as well as the Sunset Dates.