Buy Off Plan Property and Save

Property investors have long been buying property off plan – literally picking out a plot where the property will be built, before a brick has been laid. Buying in this way can save thousands of pounds.

When buying off plan you’ll often gain a discount by committing early. By putting down around 10 per cent of the final price you will then have to wait up to eight months before the property is ready to be moved into. Property investors often invest in the early stages simply for the discount before selling on for a profit once complete. As such this is not without risk – supply may exceed demand and you may have trouble selling, but in a strong market it can be the only way to get the house.

According to DTZ Residential 60 per cent of new homes sold in England and Wales were sold off plan. Given the 8 month wait between paying the deposit and the house being built, often property values have increased. New houses bought off-plan early in a development often rise in value ahead of the national average. Should the development prove to be popular the second phase will often be priced higher further improving the potential profits. Other benefits of buying off-plan include the opportunity to specify paint choices, kitchen specification, and in some cases the internal spec if building has not yet commenced.

So buying property off plan can save money but there’s still plenty to think about, to make sure the property you purchase is more desirable than the others.

When the first phase of plots go on sale the site plans are only handed out at this time making the decision pressurised – precisely what you don’t want for such a large commitment.

The local planning office will hold details plans of the site that were submitted in order to gain planning permission. You will be able to view plots positions, the general site layout and details of the house types and construction.

Having identified the most suitable plots, visit the site at different times of the day. See what surrounds the land proposed for development – is there room for another phase to follow? Speak with the local planning department and find out if any plans have been submitted developments near by. Within every development there may be one or two plots that are regarded as the prime sites. These will be sought after and will be priced accordingly.

Canny property investors who purchase new build property will more often than not buy off plan at effectively ‘wholesale prices’ while profiting from the increase in value once it is complete.