Has anyone had a ++ experience with Off the Plan?
- Thread starter eyogina
- Start date
Yep. I have. But I suspect I might have got lucky - great developer who owned (and still owns) a couple of units in the complex.
in the current market, it's a little bit difficult. But where you can get some success is either distressed stock - where they just have to get a few properties away to ensure that they've got settlement money coming through and pre-release stock, where they need to sell a certain % of properties before the bank will release finance.
Otherwise, I've seen so many people selling properties off the plan at the pricae that they think it will be worth when it's finished, and there are people still buying at that price! Not a good market to be buying into.
Recent example is I saw someone buy a 2br off the plan when the same size unit, about 4 yrs old within 500m recently sold for $160k less... there were slight differences in the block, fittings etc, but not $160k worth!
FS
Otherwise, I've seen so many people selling properties off the plan at the pricae that they think it will be worth when it's finished, and there are people still buying at that price! Not a good market to be buying into.
Recent example is I saw someone buy a 2br off the plan when the same size unit, about 4 yrs old within 500m recently sold for $160k less... there were slight differences in the block, fittings etc, but not $160k worth!
FS
The only way it works well is if you purchase in a rising market.
I know of one which finished in 2004. Cost $330 each. 2 sold for $218 and $230 last year (mortgagee sales). Now some for sale under $300 by builder.
Friends purchased one in Hornsby before the last boom. The price was higher when it was finished in the boom (sorry don't have figures). It dropped back a little but still worth more than they paid.
A book I was reading last week said it is not time to buy OTP yet (in Sydney).
I know of one which finished in 2004. Cost $330 each. 2 sold for $218 and $230 last year (mortgagee sales). Now some for sale under $300 by builder.
Friends purchased one in Hornsby before the last boom. The price was higher when it was finished in the boom (sorry don't have figures). It dropped back a little but still worth more than they paid.
A book I was reading last week said it is not time to buy OTP yet (in Sydney).
QLD
Son filled out an EOI 'expression of interes't form and put down $1000 deposit on a H&L package for his PPOR about June 2007. Paid approximately 5K more about 6 months later and moved in around Easter 2008.
Cost 337K + 3K blinds and safety screens + 6K back awning to increase outdoor living area by about 30 sqm.
Total 346K
Now worth at least 400K in my estimation based on recent sales. He is trying to get another one.
In NSW it would have cost at least 20K more to build IMHO
Sheryn
We bought a three bedroom unit in Melbourne in mid 2007 off the plan. Paid 360K and around 3 thousand in curtains / blinds. Bank has now valued this for 450K. So it looks good.
MDV,
so is there a difference between off the plan and house and land package? i understand both requires a deposit before construction and buyers only pay the agreed price once complete. maybe off the plan refers to more apartments.
Yes and no.
OTP - tends to be less room for changes, ie, you are buying the property as it is off the plan. Generally pay your 5-10% deposit and the rest on settlement / completion. Mostly done in relation to units / apartments - but may also be done in terms of houses. You are generally stuck with the plans as are, and limited even when it comes to things like colour schemes, tile choices, etc.
H&L - is done in a couple of different ways. Some times you are required to sign two different contracts, one for the land and one for the house - You will need a draw down loan for this type of H&L package. You get to choose everything - house plan, block of land, carpets, paints, landscaping, etc.
Another type of H&L package is similar to OTP in that you pay your 5-10% deposit and then the rest at settlement / completion. BUT you have alot more say over things. ie, you may still choose your plan, your block of land, carpets, paints, landscaping etc. These generally cost a little more then the h&l package with the two seperate contracts.
