Buying Off the Plan? 8 Essential Questions You Need to Ask

Love the idea of moving into a brand-new home? Buying off the plan can be a great way to secure a new property before it’s built, with the excitement of knowing your new home awaits as soon as construction is complete.

However, before you make the decision to commit to an off-the-plan purchase, it’s important to think carefully about what’s involved with this type of property. To help you gather the information you need, here are eight essential questions to ask before buying off the plan.

1. What’s included in the purchase price?

Not all off-the-plan purchases will cover the same inclusions, so it’s crucial to be clued up on exactly what’s included in the purchase price.

These inclusions may include fittings, fixtures, and finishes, as well as other additions such as appliances, window coverings, and landscaping.

Clarifying what’s covered in the purchase price of your off-the-plan property can help you budget for any extra expenses or upgrades.

2. How much deposit is needed?

Before moving ahead, you’ll need to find out what deposit amount is required for you to secure your off-the-plan property.

Deposits for off-the-plan purchases typically range from 5% to 10% of the purchase price - but could be higher - with the balance payable upon settlement. 

Understanding the deposit requirements can help you plan your finances and ensure you have the necessary funds available.

3. What guarantees and warranties are given?

Off-the-plan properties will come with certain guarantees and warranties provided by the developer or builder, so be sure to enquire about what these cover.

This may include warranties for structural defects, workmanship, and materials for a certain time period, as well as guarantees for completion of construction within a specified timeframe.

Getting clear on the level of protection offered can give you peace of mind that you’re covered should things go wrong.

4. What’s the timeline for construction?

Of course, one of the key questions you’ll want to ask is when the construction of the property will be completed, as well as any key milestones during the construction period.

Being aware of the construction timeline can help you plan your move and make arrangements for temporary accommodation if needed.

It’s important to be prepared for potential delays in construction, due to factors such as adverse weather, approvals, material shortages, and other unforeseen circumstances.

5. What aspects can be customised?

When buying off the plan, you may be able to customise certain elements of your home to suit your taste, needs, and lifestyle - so be sure to find out how much flexibility you have.

For example, you might be able to select your own finishes, fixtures, and fittings, as well as make alterations to the floor plan or layout.

Knowing what you’re able to customise can help you create a home that fits your needs and reflects your personal style.

6. What are the strata or body corporate fees?

If your off-the-plan purchase is for an apartment or unit, you’ll want to find out about the strata or body corporate fees associated with the property.
These fees cover the maintenance and management of common areas and facilities within the building or development and can vary significantly from property to property.

Understanding the ongoing costs of these fees can help you budget for the total cost of ownership and plan for future finances.

7. What is the developer's track record?

Before committing to an off-the-plan property purchase, it’s advisable to research the track record and reputation of the developer.

Look for developers with a proven history of delivering high-quality projects on time and within budget, considering factors such as experience, financial stability, and previous projects completed to assess their credibility and reliability.

Reviews or testimonials from previous clients can also provide valuable insights into the developer’s level of quality and service.

8. What are the risks and contingencies?

Finally, be realistic about the risks and contingencies associated with buying off the plan. 

These may include potential changes to market conditions, variations in construction costs, and unforeseen delays or issues during the construction process. 

To avoid any nasty surprises down the line, it’s important to have a clear understanding of all the potential risks and to have contingency plans in place - just in case the worst happens.

If you’re looking to secure a brand-new property with the potential for customisation, an off-the-plan purchase could be just the ticket. However, this type of purchase isn’t without its risks and drawbacks, so be sure to ask the right questions so you can make an informed decision.

Keen to learn more about home-buying process? Check out our other articles and stay in the know about all things home loans.

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This article is intended to provide general information only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. Please consider seeking financial advice before making any decision based on this information.

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