Benefits of buying an off-the-plan apartment
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Whether buying an investment or a home to live in, an off-the-plan apartment can offer many perks. 

Off-the-plan purchases often attract lucrative stamp duty savings and incentives as well as depreciation benefits if you opt to lease the unit to tenants. Because the apartment is yet to be complete, you may also be able to tailor certain features.

Here are some advantages to consider when buying an off-the-plan apartment.

1. More time to save

When making a property purchase, every dollar counts. So, having more time to save while your off-the-plan apartment is being constructed can be an appealing option.

“Buying an off-the-plan apartment is great if you need a bit more time to save,” said Emma Baker, from Canberra-based InStyle Estate Agents, which specialises in off-the-plan apartment sales.

“In Canberra, you are able to unconditionally exchange on a 5% deposit with settlement often more than 12 months away. That means another 12 months for you to save the other 5% before you need to get finance. Or if have a property you need to sell before you settle, you have sufficient time to do so.”

2. Time is money: start gaining equity immediately

Purchasing an off-the-plan apartment means you can effectively buy at today’s price and start gaining equity as soon as you sign on the dotted line, before construction has started.

In a buoyant market, this can mean you will own a property that’s worth more than you paid for it by the time you move in.

“If you purchase either prior to construction starting or very early on after construction has started, there is a high chance the market will increase before you settle and you will gain equity,” Ms Baker said.

However, it can also go the other way if property prices decline, so buyers should do their research and be aware of the potential risks.

3. Shiny and new

Who doesn’t love something shiny and new? Off-the-plan apartments are exactly that.

Ms Baker said one of the biggest lures for buyers was the fact their purchase was brand, spanking new.

“It’s new – everyone loves new,” she said.

“All off-the-plan properties come with a minimum of 90 days maintenance. You don’t find this in the established market where what you see is what you get.

“In off-the-plan properties, if there is anything that may require fixing (outside of painting), the builder will attend to it.”

4. Incentives

As well as developer and builder incentives, there may be discounts on stamp duty and other taxes depending on which state you’re buying in.

“Off-the-plan properties often have developer incentives – whether it’s cashback or window furnishings, these are all savings,” said Ms Baker.

In addition, some state and territory governments offer stamp duty concessions or incentives to reduce the stamp duty you pay on off-the-plan purchases.

For example, The Victorian off-the-plan duty concession is available to owner-occupiers and reduces the stamp duty paid on a property for eligible purchasers.

The concession works by changing the “dutiable value” of your property. This is usually the purchase price and stamp duty is calculated from that. However with off-the-plan properties, the dutiable value is calculated as the purchase price minus any construction costs from the date the contract is signed.

The Victorian Government has increased the dutiable value threshold to $1m for contracts entered into on or after 1 July 2021 and before 1 July 2023.

Owners who rent out their completed unit may also be eligible for tax deductions. It’s worth getting a depreciation schedule drawn up by a professional once the property settles, which will help at tax time.

5. Make it personal

If you like the idea of having a hand in designing your apartment, buying off-the-plan means you may be able to select your own floorplan and internal colour palette, depending on the project.

“Off-the-plan usually means choice,” said Ms Baker.

“In a project, you will find a number of floorplans to choose from. There are often other upgrades you can add on as well – and sometimes you get to pick the colour palette. There are many ways to personalise an off-the-plan property.”

6. Amenity

If you’re looking for a resort-style lifestyle, an off-the-plan apartment may deliver.

Many high-rise and medium-rise apartment complexes offer a host of amenities including swimming pools, saunas, communal entertaining areas, break-out barbecue spaces, fully equipped gymnasiums, private dining rooms and in-house cinemas.

Maintenance of these features are usually paid for and supported by strata levies, which are shared among all owners.

“Items such as lifts and building maintenance are also costs included in levies. Levies are divided amongst a project and each residence pays a portion determined by the size of their residence relative to the project. Fees tend to range between $900 and $2500 per annum,” Ms Baker said.



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