Whether a freehold home or sectional title unit in a secure estate or a complex, buying a property off-plan in a new development from a reputable developer offers numerous benefits, writes Gareth Bailey.
Firstly, there are financial benefits to buying off-plan as buyers can save on transfer duty because development sales include VAT and the banks treat the VAT portion as part of the purchase price. This means the buyer doesn’t need to come up with additional cash for transfer duty which would usually be the case. In addition, more advantageous financing options are often available and off-plan purchasers can often receive 100% home loans.
A cash deposit of just 10% generally secures the purchase, with the balance payable one or two years later when construction of the unit is complete. As a result, the property is likely to appreciate in value. In other words, buyers can enjoy capital growth before they have even taken ownership, depending on timelines, payment structures and market conditions.
Plot-and-plan purchases can be profitable for buyers who identify good developments being launched in popular or up-and-coming areas and get in early. Depending on the size, a project which is going to take a couple of years to complete can yield solid capital gains in a relatively short space of time, provided that the development sells well and goes ahead according to plan. This is why it is important to ensure you are dealing with a reputable developer and estate agency.
Another key advantage of buying into a sound plot-and-plan development is that the end cost is established at the outset with the buyer signing a building agreement at a fixed price. This eliminates the hassle and costs involved in designing and building the property, especially as budgets can escalate.
Land and building packages are most often located in secure estates and buyers enjoy the dual benefit of investing in a home customised to suit their own individual preferences in addition to a secure lifestyle. This type of investment is often more expensive than buying an existing property in the marketplace, but it offers a contemporary, customised home, with brand new fixtures and fittings which will ultimately save on maintenance and upgrades in the years to come.
Buying a freestanding home on an estate offers flexibility ranging from a completely bespoke design to choosing from a set list of options for buyers with a firmer budget. New houses in these developments come with developer and NHBRC (National Home Builders Registration Council) guarantees, while architectural guidelines create and maintain a standard of construction and design to help future-proof these investments. Strict architectural guidelines and estate rules also ensure conformance to the aesthetics of the estate and further help to protect and bolster home values over time.
Gated communities also offer buyers a higher degree of service in terms of maintenance of the common property, while architectural guidelines are contemporary, incorporating the latest design trends and technology, and most importantly, allowing for the inclusion of new energy generation technology, which is expensive to retro-fit in existing homes.
Given the major structural shifts, we are seeing in terms of the way we are living and working, and the desire to “go green” or at least reduce our dependence on increasingly expensive government-supplied utilities, such as electricity – particularly amid ongoing load-shedding – there is much to be said for designing a home to reflect these new imperatives rather than trying to restructure an existing house.
Apart from the appeal of modern design, new buildings offer the latest in digital security and fast bandwidth for residents, while many include air-conditioning and home automation. Green features are usually standard and include economical use of grey water and efficient hot water generation.
Finally, buying into a new-build offers buyers peace of mind in the form of building warrantees and once the development is complete, buyers have a period of time during which to inspect the property and create a snag list of defects which are then rectified at the developer’s cost. *