Off Plan Property Meaning: Should you Invest?

This article details what exactly off-plan property means, and whether you should consider this type of investment.  
 
Investing in property has long been a popular way to grow your finances. Whether it’s short-term rentals, serviced accommodation, holiday lets, or more commercial ventures – many choose this as a reliable way to increase their investment portfolio.  
 
If you’re an investor, then you’ve probably heard about Off-Plan Property. So, what exactly does it mean to invest off-plan?  
 

Off-Plan Property Definition

An off-plan property is a property you purchase before it’s been fully built. You’re essentially buying a property based on the developer’s designs – sometimes before construction has even begun.  
 
This comes with a few key benefits: 

• You often invest at a lower initial price compared to buying a completed property 
• The expectation is that the property will increase in value once it’s finished 
• You can then sell the property for a profit, or rent it out for a steady stream of income

 
This differs from investing in completed properties, which require the full purchase price upfront or mortgage financing, but come with reduced risk as the property already exists, and you can immediately receive rental income. 
 

How does off-plan property investment work?

There are a few key steps involved in off-plan property investment. Once you’ve found your ideal location and property, the actual buying process is as follows:

1. Reserve your property with a fee to take it off the market and lock in the price
2. Review the contract thoroughly to ensure everything is as agreed – for example the payment schedule and projected completion date
3. Exchange contracts and pay the initial deposit
4. Monitor the construction and keep in touch with the developer on progress
5. Completion and handover of the property, when you’ll obtain all necessary paperwork and get your keys   
    

Once complete, you can then decide whether to rent out your new property, or sell for a profit.  
 

Is Off-Plan Property Right for You?

Investing in off-plan property has great potential, but is it right for you? 

Financial Goals

One of the main advantages of buying off-plan property is the potential for capital growth. When you invest at the early stages of development, you can then benefit from the property’s value appreciating as construction progresses and the market value increases. This is particularly attractive if your goal is long-term wealth building or expanding your property portfolio.  
 

Risk Tolerance

While there are many benefits, there are also unique risks to investing off-plan. Construction delays, changes in market conditions and lack of immediate income could impact your investment, yet the potential rewards can be high.  
 
If you have a lower tolerance for these kind of risks and uncertainty, you may feel more comfortable investing in completed properties instead.  
 

Investment Timeline

Investing in off-plan property is a longer commitment, with many projects taking years to complete. If you’re in a position where you can wait for the construction to complete, off-plan investment could work well for you. If your aim is quick returns however, a completed property may be more appropriate.  
 

Consider Working with a Property Management Company

If you’re new to off-plan property investment, or are looking to grow your business more effectively, working with a property management company like The Right Property Group can help.  
 
From finding the right off-plan property to invest in, to solidifying the buying process – we give you exclusive access to high-potential properties, and a team to guide you through the entire process. Get in touch with our team today to chat through your options. 
 
If you aren’t quite ready to talk to us yet, why not read our in depth Off-Plan Property Investment Guide for more information about what to expect with this kind of investment.