Purchasing off-plan property is a major choice for most individuals, and it comes with its own set of steps to follow. However, several frequent mistakes that people make while investing can drastically alter their experience. As one of the best investment options, off-plan requires critical thinking as well as attention to detail. Below are 6 things to keep in mind when purchasing off-plan.
First thing first, you can’t rush an investment. You have to think ahead and plan if you want it to be successful. Off-plan properties take from months to years to be done, and you need to make sure you understand the timeline ahead of you. Patience is key when buying off-plan, especially when you’re going to be paying installments during that period.
Next, after understanding your timeline, understand your goal. Why do you want this property? Investment? Personal use? Short-term rental? Resale? Different properties are good for different uses. This will help you better choose a property that suits your goals.
After that, you need to check your budget. Keep in mind that there are additional fees you’re going to have to pay when buying an off-plan property, such as service charges and DLD fees. Those charges are not part of the final price of the property but are dependent on it.
When you’re deciding whether to buy something or not, always check for due dates. Understanding when the deliverables are will help you make sure that you know what to expect and when. Things such as snagging and handover are important milestones in your property development. Make sure the developer keeps you informed about construction milestones too.
When you go ahead and start the process of purchasing a property, you should make sure that you stick to your payment plan. Whenever you miss a payment, there are big penalties that you will have to pay that will make it a lot harder for you to finish your installments.
When you make your payments too, you have to make sure that you’re sending them to an escrow account, not an agent or company. An escrow account is a specialized bank account for a real estate development project in which all money paid by off-plan buyers and financiers is ring-fenced and only utilized by the developer to construct and complete the specific project.