The Pros and Cons of buying off the plan property

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Thinking of buying off the plan? Here are the things you must know before you do so.

Buying ‘off the plan’ means that you are entering into a contract to purchase a property before it has been completed by a developer. This is a legally binding agreement so make sure you understand the pros and cons before you sign the contract and pay the deposit.


  • Save on stamp duty payable in Victoria – this amount saved varies depending on the stage of construction.
  • Pay a 5-10% deposit upfront, with the balance paid on settlement – giving you time to sort out your finances. Settlement can range from a few months to a few years’ time.
  • Lock in a fixed purchase price at today’s price – in a rising market this can mean capital gains before you even settle the property but make sure you do your research.
  • Tax depreciation savings are greater if purchased for investment purposes than established properties.
  • You have a brand new property with no work required.

It’s important to do your homework when it comes to off the plan property purchases. Know the market, the developer and builder and review the contract carefully. There are many benefits but also expensive risks involved.

John Sekulic, Buyers Advocate at The Property Garden


  • You might not get what you pay for – ensure your contract is clear and not ambiguous. It should be comprehensive and set out all details, including fixtures and fittings, remedies for any disputes and timeframes to name a few.
  • Quality – there is a risk that the quality of the build and fixtures and fittings is not to the standard expected. Check the contract for the details of fixtures and fittings including brands and models. Have a look at the track record of the developer and completed builds – how is the quality and have the properties stood the test of time? Make sure you see past the glossy marketing photos.
  • Market price can be lower than purchase price at settlement – If the property is valued lower than the purchase price by the bank at settlement then chances are you will need to find some extra cash in order to secure a loan. This is where it is important to know the market – are there several apartment complexes being built in the area? Are there many subdivisions happening? It all comes down to supply and demand.

Buying off the plan can be and exciting and daunting process at the same time. Ensure you do your research and know the market to avoid making any costly mistakes. Don’t be afraid to call in the help of experts.

The Property Garden are Buyers Advocates and Feng Shui consultants and have over 19 years’ experience in the real estate industry. We take a holistic approach to assisting our buyers buy property in Melbourne, Australia.