By now you have probably heard about off-plan property investment…
Right?
So, what is it, and what are its benefits for real estate investors?
In a simpler version,
Off-plan property investment is defined as buying an uncompleted project without committing to it.
In other words,
Off-plan property investment is a great way to get into the housing market without committing to a building.
Here are the benefits of off plan property investment you should know:
- Locking in an early price
- Capital appreciation on the value of the property
- Favorable loan packages and interest rates
- Better payment structures
- Higher rental yields
- More customization options
- Easier to resell the property
- Low maintenance cost
Locking in an early price for the off plan property investment
One of the biggest benefits of off-plan property investment is that it allows you to lock in an early price.
This means that if you were to buy the property at a later date, the price would have increased and your return on investment may have been lower.
By locking in an early price, you can avoid this risk and get your money back with interest sooner rather than later.
Capital appreciation on the value of the property
Capital appreciation is the increase in the value of a property after it’s been sold.
It’s usually calculated as a percentage, with 100% being equal to what you paid for it and 0% being its current market value.
Capital appreciation isn’t guaranteed—what makes one property more valuable than another depends on many factors including location, condition, size, and style(if there are any renovations).
But more importantly, you can expect capital appreciation if:
- The area has grown or changed since you bought it – this means that homes within walking distance of shops or public transport will tend to have higher prices than those further out from such amenities;
- Your house has been well maintained – this could include regular maintenance such as garden care or painting;
- Your neighbors have done well too – if they’ve improved their properties then yours could follow suit!
Favorable loan packages and interest rates
The loan packages are also attractive.
For instance, with a 20% deposit, you can get up to 80% financing.
The interest rate is generally low and there are no prepayment penalties or early repayment charges.
The main benefit for the buyer is that it means he/she has less paperwork to deal with when buying an off-plan property that may not be ready at the time of purchase.
This means less hassle for both parties involved: the seller and the buyer!
Better payment structures
Off-plan property investment payments can be tailored to suit your needs.
You can pay in stages, or all at once.
Higher rental yields
Rental yields are the returns on investment from renting out a property.
They can be higher for off-plan properties, especially if you choose to buy an apartment building or a hotel.
It’s important to know what your rental yield will be before you invest in an off-plan property so that you aren’t disappointed by its return later or down the line.
More customization options
Off-plan property investment offers more customization options than you may think.
You can choose the number of bedrooms, bathrooms, and other features in your home.
This is because off-plan properties are designed to meet your exact requirements rather than being built on a standard construction site with a number of standard designs available.
You can also choose the layout of your new home based on how much space you need or where exactly you want it located within an area close to public transport.
Off-plan properties are brand new or have never been occupied
Off-plan properties are usually built in the last few years and can be purchased by anyone who has a mortgage, regardless of the amount of their income.
This means that if you have a low income, you can still buy an off-plan property with ease and without needing any help from other sources such as loans or grants.
Lower cost to hold and maintain the property over time
A benefit of off plan property investment is that it can save you money to hold and maintain the property over time.
It’s common for developers to offer reduced maintenance costs when they sell their properties, but this is often only available if you choose an apartment or a serviced residence option.
Off plan properties are typically purchased by investors who intend on living in them, so they’ll want their investment properties maintained well enough so they don’t have any issues with tenants later down the track.
Easier to resell the property
Off plan properties are easier to resell.
It is possible to sell the property before it is built, which means you can get a higher selling price and make more money from resale.
However, if the property does not sell in your target market at all, then there is no point in doing so because it will just cost you more time and money than if you had kept the sale on hold until after completion of construction works were finished.
These benefits make off plan property investment more attractive than buying a completed building
Off-plan property investment is a great way to get into the market, at least for those who don’t have money to put down.
But there are some downsides as well:
- The property may not be what you expected or hoped for when buying it (or maybe even worse).
Conclusion
These benefits make off plan property investment more attractive than buying a completed buildings…
So if you are interested in investing in real estate, you can kindly contact us – I want to invest