The Key Benefits Of Buying Off The Plan
Buying off the plan is one of those endeavours that is sometimes portrayed as a “risky” investment, but buying in advance of a property being built can offer many benefits including financial gains and peace of mind. It can also be more affordable and offer more flexibility than buying an existing property.
With the New Zealand housing market being highly competitive of late, more people are deciding to buy off the plan with an increasing number of land developments both in central cities and surrounding suburbs in play. A couple of new builds by leading property development company, Safari Group, who have delivered some of New Zealand’s most prized projects for both investors and homeowners alike, are Augustus Park Parnell and The Residences at Central Park both of which are centrally located in Auckland’s most in-demand neighbourhoods populated with a wide range of high-quality tenants.
One advantage of buying off the plan is that you will have time to prepare financially and save the money for the final payment without worrying about making mortgage repayments.
With an initially low outlay in a set deposit – in most cases just 10% – paid upfront to secure the property, you will then have the extended construction time to save up the outstanding balance, which is due on the completion of the build. For both Augustus Park Parnell and and The Residences at Central Park, the deposit is 10% of the purchase price for New Zealand residents. Time is on your side, as projects can stretch for months to complete. These premium property developments by Safari have an anticipated date for settlement of Q3 2023, however purchasers will be updated of key milestones and be informed of progress in real time.
When you buy off the plan, you also lock in the “first release price” at the time. It’s also worth noting here that sometimes prices increase as construction nears completion, meaning you could pay a bit less by buying early off the plans.
Furthermore, If you get in early before construction has started you can get your pick of the properties on offer, and there is often some flexibility offered by the developer in terms of being able to modify the design to suit your preferences.
Prices for off the plan real estate also tend to be lower in any event, as buyers are naturally more cautious about paying more for properties that they can’t see first-hand; instead, having to base their decisions on reviewing developer’s construction plans and artistic renderings as to how the end product will look inside and out.
Depending on where you buy the property and if you have bought when the market is buoyant, the property could also increase in value over the time the developer takes to build the apartment. So you could end up paying a lot less for a property now, compared with when you move in, and reap the benefits of immediate capital growth. Given how property generally tends to go up over time, this is a reasonably logical assumption.
Another potential benefit is if you are a first home buyer, you might also be eligible for a First Home Grant of up to $10,000 per person, which is twice the amount available if you are opting to buy an existing property. For those purchasing off the plans as an investment, the good news is the recent interest deductibility limitations for residential properties do not apply to new builds acquired off the plans, with interest deductions being available for 20 years from the date the Code of Compliance is issued. This exemption applies to anyone who owns the new build within the fixed 20-year period.
Another benefit worth considering of buying off the plan is that the apartments will be brand new and constructed in accordance with the latest building standards and energy-efficient, you won’t be needing to fork out as much for utility bills and ongoing repairs, renovation or maintenance as you might with an older home, for the years to come. In the case of Augustus Park Parnell, units come fitted with a heat pump, oven, cooktop and dishwasher, fridge & freezer, washing machine & dryer and are fitted with curtains. For The Residences at Central Park apartments also come with a heat pump, oven, cooktop, dishwasher, and are fitted with curtains.
For more information, contact Safari Group Team:
https://safarigroup.co.nz/contact/
0800 790 790
