Ways to win when you buy off-plan

With the number of existing homes for sale in the affordable price range diminishing, new developments are starting to regain popularity, especially with first-time buyers.

And there are several factors in favour of buying a home “off-plan”, including the following:

  • You can peg the cost of your home at today’s price, which is important because building costs are still rising faster than inflation.
  • You will usually need only a small deposit to secure your home, which means you can save your cash to cover transfer costs, or to reduce the capital portion of your home loan when you move in and immediately lower your minimum monthly instalment.
  • You may find it easier to obtain a home loan if the development has been approved by one or more banks – and some developers will even offer to pay your bond registration and transfer costs.
  • You can often customise the layout and certainly the finishes to be used when the home is built, so that you get exactly what you want.
  • You will save a significant amount on maintenance in your first several years of ownership. Newly-built homes also come with foundation, structure and roof guarantees.

However, says Aida National Franchises operations manager Ester Odendaal, there are also certain precautions that “off-plan” buyers should take.

“They should for example be careful to deal only with reliable developers that have a track record of completing projects on time and with quality workmanship - and with marketing agents from an established, reputable real estate company.

“Also, they must make sure that any deposit they pay will be held in the trust account of an attorney or registered estate agent. Otherwise it is all too easy for a shady developer to present an impressive-looking marketing brochure, gather in deposits from unsuspecting buyers and then vanish with all their money.”

Next, she says, buyers should take the time to decide exactly what they want in their new home, and make sure that the sale agreement spells everything out in detail, so that they don’t face unexpected ‘variation costs’ when building is completed and they are ready to move in.

“And finally, they should really try to ensure that whoever is building their new home is only paid on performance. If they immediately obtain a home loan for the building, for instance, the bank will only pay draws to the builder at certain pre-determined stages of the project, with the last amount being payable only after completion and inspection.”

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 23 Nov 2017
      As the holiday season approaches, most of us are counting the days until that year-end bonus hits our account. There’s nothing quite like a little bank balance booster to get us in the holiday spirit.
    • 23 Nov 2017
      The Adelphi Centre (now entitled “ARTEM") in Sea Point, Cape Town, is being extensively renovated, and once complete will offer an ultra-luxurious galleria style shopping centre unlike any other seen on the Atlantic Seaboard or in Cape Town.
    • 23 Nov 2017
      If you are looking to sell your home in today’s real estate market, there are certain things that you need to include both inside and outside your house. Today’s generation of home buyers is looking toward a more eco-friendly, energy and water conscious home, and if your house stands out then you are more likely to be able to sell it.
    • 22 Nov 2017
      Most people know of the Community Schemes Ombud Service (CSOS) and that levies must to paid to fund its operations. In this article the experts at Paddocks will address some of the issues that are causing confusion.
    • 22 Nov 2017
      While sales have noticeably slowed in most sectors in most Cape town suburbs, the security estate sector in Constantiaberg has bucked the trend by remaining buoyant, with sales by August this year already surpassing total sales in 2016.
    • 22 Nov 2017
      The end of the year is fast approaching, and so are all the travellers, tourists and holidaymakers. For those who live near or own a property in a holiday-hotspot, the festive season also brings with it an abundance of short-term rental opportunities. Its a great way for property owners to make a few extra rand for their own holidays or to put towards their savings.
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
    • 21 Nov 2017
      When an offer to purchase a property is signed by both buyer and seller, this constitutes a binding agreement or “Deed of Sale” between the two parties. However, in most cases the “standard contract” might not be enough to cover all the specifics pertaining to the sale. The agreement may require some additions or alterations to clauses, which needs an expert hand in the drafting of such
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us