1. Stamp Duty Savings:
Purchasing an investment property off the plan rather than already built will save you a substantial amount of money in Stamp Duty. According to realestate.com.au – for a $500,000 property your stamp duty savings could be as great as $18,700 by purchasing off the plan.
2. Capital Gain
Purchasing an off the plan investment property – particularly if you get in before construction begins – gives you the added advantage of reaping potential capital growth. You have purchased a property at today’s price but have the potential to settle on a property worth more than you paid.
3. Gives you extra time
Purchasing off the plan also gives you the benefit of having extra time up your sleeve between payment of deposit and settlement. Depend on when you opt into the project, you could have as long as 18+ months. Your deposit will be required when you sign your contract, however, the balance will not be due until settlement. This gives you additional time put more capital aside and reduce the amount you will need to borrow.
4. Maintenance savings:
You will save lots of money by purchasing brand new – off the plan versus an older property, because – as the title suggests – it is all brand new. The maintenance that your tenants will request will be significantly lower than in an older property, and majority of faults or issues that will be reported will be covered by building or goods defects warranty.
Finally, the hidden gem of purchasing off the plan is the depreciation of the property. Unlike a valuation, depreciation tracks the diminishing value of your investment property which can be integral in planning, supporting and growing your investment portfolio.