5 things agents wish clients knew about buying off plan
“Buying a property off plan may be an attractive option, but there are also potential drawbacks. Before making a decision, buyers should take these pointers into account”
Off -plan properties allow buyers to select the size, style and finishes of their new home. This option is also especially attractive to first-time buyers as there’s no transfer duty: most people struggle to save for a deposit and it’s considerably more affordable without the additional cost.
But, as with any property purchase, buyers need to do their homework about the developer and builder, and read the fi ne print. It is possible to buy a lemon – albeit a new one.
1. ESTABLISH THE DEVELOPER’S REPUTATION
Buyers should look at the developer’s track record. Has the company successfully completed previous projects? Have they done so in a timely fashion? Is the developer and the builder the same person or company? If not, then look into the builder’s work as well.
Buyers are advised to establish whether developers are registered with either Master Builders South Africa or the National Home Builders Registration Council.
2. INSPECT THE DEMO MODEL
Have a look at a demo unit. Artistic renders and sketches don’t necessarily translate into real life. Spending time going through a model property will allow buyers to understand the quality of the workmanship and materials.
3. STAY ON TOP OF THE BUILDING PROCESS
Enquire about materials as they may differ from the demo model in some respects. In addition, the majority of building agreements will allow the developer to deviate from the plans by 5% to 10% without having to consult the buyer. If buyers don’t stay on top of the process, they could find themselves with a property that’s different to their specifications.
Buyers also need to check the building contract carefully to see exactly what materials and fittings are included in the specifications and what would be regarded as extras, which will cost more. Communal facilities need to be clearly identified as well as rules and costs regarding pets, landscaping and security.
4. READ THE FINE PRINT
When purchasing a stand in a sectional title or estate development, the standard contract states that the landowner needs to build their property within a stipulated period, according to Smith Tabata Buchanan Boyes. Failing this, the homeowners’ association may impose a penalty.
This ensures that the development reaches its investment value within anticipated time frames and safeguards other owners from the implications of continuous building operations. The period generally ranges from one to five years.
5. UNDERSTAND OCCUPATION DATES
The contract needs to include a date by which buyers can move into the property. The buyer will be entitled to cancel the contract should the home not be ready in time. In this instance, the buyer will be reimbursed for money spent up until that point, including the deposit and progress payments made to the builder.