What are the risks associated with buying off the plan?
For every upside to buying off the plan, there’s a potential downside.
For example, let’s look at the main advantage to buying off the plan as listed above ie: that the purchase price agreed in the contract could end up being a lot less than the value of the property when construction is completed, thanks to the natural propensity for prices to increase over time.
As you might have guessed, the exact opposite is also a distinct possibility. That is, if property prices drop during the time it takes to build the property, a buyer could agree to pay a lot more for a property than it is worth by the time the property is complete.
This risk can be minimised by careful research of the location of the project and also ensuring the purchase price is at or below the current market value for the area.
I also recommend buying Titled Land when purchasing a House & Land Package as the Finance is applied for and approved at the beginning, rather than up to 18 months away when the land becomes Titled.