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Buying Off the Plan vs Established Build: Pros and Cons

Written by Bermudiana Beach Resort

19 | 11 | 21

Advice  |  
3 minute read

Buying property is always considered to be a steady and valuable investment. However, before signing on the dotted line, you’ll have a crucial decision to make early in the property hunting process. Should you buy off the plan or an established build?

In this blog, we’ll outline what that means exactly and run through some pros and cons for each to help you make a well-informed decision. 

 

What's the Difference?

Buying off the plan is when you choose to purchase property before it's been fully built.  This might sound like a risk, but if you're looking to move into a market where property prices are high and rising fast, it can have its rewards. 

As you’d expect, buying an established build is purchasing a home or condo that is already built. As soon as everything is agreed upon, you can move in right away.

 

Off the Plan: The Pros

Price

Developers never want to be left with empty units that they’re struggling to sell, especially if they already have their eyes set on their next lucrative development. This means they’re often willing to part with high-end units at prices that are lower than you might expect. You’ll struggle to find the same desire to sell in established builds.

Customisation

An unfinished build is just that — unfinished. Often, there’s still time for you to make recommendations and suggest those final details so everything is exactly as you want it to be. This isn’t always the case, so you’ll need to speak to the developers in question. However, as we’ve already said, many developers want to get those empty units sold and if a little bit of customisation can finalise the sale, they’ll be happy to oblige. 

Growing Property Value

If you're lucky enough to complete a sale of an off the plan property before it’s ready, then you could benefit from a lucrative resale value. Generally, the property market is moving in a healthy upwards fashion, particularly in popular parts of the world. If you’ve purchased below market value, then you can benefit from growing market prices and sell for a profit. 

 

Off the Plan: The Cons

The Market Might Fall

The keyword here is ‘might’. The market can be volatile, so it’s essential to examine how things play out in different scenarios. Like with any investment, there's a risk, so proceed with caution and only commit to a property once you’re happy that it’s the right course of action for you at that time. 

Developer Delays

No matter how big or small the development, project delays are commonplace. If the property isn’t ready until a little later than planned, then don’t panic. What’s important is open communication. If your developers are providing regular updates, then you’ll always know where you stand and what the latest situation is. 

Difficulty Finding a Mortgage

We’d always recommend speaking to a specialist mortgage broker before you commit to any off the plan property deal. A lot can change in the mortgage market over a short period, so it’s not beyond the realms of possibility that it’s more complicated than usual to get the mortgage you need. This is because mortgage offers usually expire after six months, but you may be reserving a property for a year or more. 

 

pros and cons of off the plan homes

Established Build: The Pros

No Waiting Time

Off-plan properties might require you to wait 12 to 18 months before they’re ready to move into. This isn’t the case for established builds. In most cases, the property is ready to move into immediately once everything is agreed upon and all parties are satisfied. 

Visits

Want a closer look at the dining room? That’s a simple request for established builds. Unlike with off-plans, you can easily visit the property and measure up rooms to make sure they suit your needs. Off-plans might have example show homes you can tour, but you may not be able to visit the exact unit or house. 

 

Established Build: The Cons

Volatile Chain

Traditional property buying involves chains of buyers who all must wait for their turn to complete the purchase. Any single link within that chain could break, leaving many disappointed potential homeowners. 

Major Work

The older the property, the more chance you need to carry out major work once the keys are yours. Poor energy efficiency, in particular, is something that many new buyers have to tackle once they’ve signed on the dotted line. 

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