New versus old: Why off the plan property makes sense
When it comes to real estate investing, it’s important to find a rental property that can provide you with a multitude of benefits to help you create wealth in the long run.Apart from finding homes in property hotspots, it’s also crucial that investors look for other features, too. This can include buying into an area with access to great amenities, a high level of population growth, low vacancy rates and high rental yields. However, it’s also crucial to find a property that is in good condition so it can retain its resale value in the future.A property that is in immaculate condition and built to a high standard is likely going to provide you with a better return upon resale, opposed to an established and older property that could experience maintenance problems over time.Benefits of off the plan investmentOff the plan properties are brand new, and like most items you buy new, they come with a warranty. Builders in Australia are required to provide a warranty for the property they construct, which covers the building’s structure. This differs from established dwellings, which could experience a number of problems that you’ll have to pay for using insurance or your own funds.Finally, off the plan properties are designed to meet the tastes and needs of today. This means they’re likely to be well suited to a wide range of tenants, helping to make them more rentable.One of the biggest benefits of purchasing off the plan property is how you pay for it. Most off the plan properties only require the purchaser to pay a 10 per cent deposit when the contract of sale is signed, while the balance of the sale is paid once the property has been completed and the sale has settled. This means investors have ample time to sort out their finances to cover the remainder of the balance.As purchasing off the plan properties only requires the deposit to be paid at the time of sale, they make an easy addition for those looking to expand their investment portfolios through refinancing.Another benefit of off the plan investment is that there is the potential for capital gains to be made before the property has finished being built. This is because purchasers secure a price for the property and sign a contract of sale for that fixed figure. Should conditions and market fluctuations work in the owner’s favour, the value of the property could rise due to changes in the market before construction has completed.As a result, the owner could end up with an asset worth more than what they originally paid for!Whether you’re looking to start your property portfolio or expand your existing one, off the plan properties offer owners many benefits.