Buying off plan is becoming increasingly mainstream
Experience Invest explains the pros and cons of investing in off plan property.
In an era where there is an acute shortage of property, investing in off plan developments is a smart way for investors to expand their portfolio and for first-time buyers to get on the first run of the property ladder.
Whether it’s a residential apartment or house, a purpose-built student accommodation development, a commercial office building or even a care home facility, off plan property is becoming increasingly mainstream.
To highlight the demand for this type of property, a new off plan residential development in London’s Canary Wharf called Maine Tower was almost sold out in just a few hours. Out of 230 apartments offered, 208 were snapped up by investors in just 4 hours after launch.
“The volume and speed of sales at the Maine Tower launch was incredible and shows the confidence that buyers from both the UK and overseas currently have in the London market,” David Galman, sales director at Galliard Homes told The Guardian.
Traditionally off plan opportunities were only available to cash-rich investors however, in recent years, its’ not just investors who are leaning towards the off plan property market.
Owner-occupiers looking to buy off plan
Though buying off plan has long been popular with investors, the trend is becoming more common place with owner-occupiers. As the demand for new homes increases, mortgage rates improve, and access to government-led schemes such as ‘Help to Buy’ are more readily available, many people in the UK are looking to buy early.
According to an article in The Times, up to 80 per cent of off plan sales at a new residential scheme of 106 new homes in Vauxhall, south London, were reported to be to owner-occupiers. And the trend, it seems, is not just happening in London.
Why buy off plan?
Choosing to invest in a property off plan has its advantages. Units released early may be priced lower than similar properties being marketed in later phases. Purchasing off plan may also allow you to select interior finishes such as kitchen and bathroom units, and fixtures and fittings, rather than these being predetermined by the builder.
Some investors buy with the intention of selling the property on before completion. Be warned though, new developments are prone to delays, and build completion dates are often deferred.
How easy is it?
Buying off plan means relying on information provided by the agent or the developer marketing the site. Generally a range of materials such as architectural drawings, computer generated models and virtual tours are available.
Click here to watch an example of an off plan property investment.
These type of details will help you picture what the finished product will look like. Some developments include a show home, so customers can get a feel of the quality of finish they can expect.
Ways to invest
Due to the popularity of this type of investment, many opportunities are sold out very quickly. In some cases buyers miss out as they are not aware of the opportunity on the market.
Agents like Experience Invest focus on sourcing and developing income generating, off plan property investments in the UK.
From off plan residential developments to student accommodation and healthcare property, Experience Invest offers UK and international access to a range of exclusive projects.