BUYING OFF THE PLAN
buying off the plan
Why buy an apartment or townhouse off the plan?
Not only do you get a brand new property, built to the latest building code, but the price is fixed at the time of purchase. You also get the opportunity to buy into an exciting new development or precinct. Tenants love new builds, so buying off the plan is a great investment choice too.
However, not all developments are created equal, and the array of options on the market can be daunting.
10 things you should investigate before buying off the plan
The pedigree and track record of the developer
You're backing them to complete the project, to the standard they’ve promised. Do your research, inspect other projects they’ve done - make sure they have a good reputation.
The old real estate cliche - location, location, location
This doesn’t change with apartments - in fact it’s more important. Think about how close you are to local amenities, cafes, shops and education providers. What’s happening in the area? How much other development and investment is going on? Where are the transport links? There’s no point buying an apartment if you can’t walk to everything.
What makes the development stand out from the rest?
Make sure you’re buying something with unique features, that isn’t the same as all the other developments. This includes size, quality, location, views and car parking. Make sure you’re buying into something that will appeal to future tenants and buyers.
Is it built to minimum standards (NZBC), or have they gone above and beyond?
Check all the details - fixtures and fittings, wardrobes, floor finishes, balconies, parking and communal spaces - carefully.
The soundproofing
The minimum standard in New Zealand is 55 STC (sound transmission class) and IIC (impact insulation class). Aim for above the minimum if you can - 65 STC/IIC is great and will make a huge difference to the enjoyment of your space.
The size and layout
Make sure you understand how big your apartment or townhouse is actually going to be. Check the square meterage. Remember this will include ‘wasted space’ like hallways and cupboards. Furniture shown in marketing materials can be deceptive. Make sure you ask what size beds are placed in the bedrooms.
Choose your outlook carefully
Are you going to get plenty of natural light? What about sun? Will your apartment be blocked by a future development? Do you want views? If so, city or water? Think about these things carefully - you can’t change a view. Obviously the price will increase as the view gets better.
Do your due diligence
Make sure you thoroughly investigate the body corporate; check that the annual fees are realistic and will cover expected maintenance. Read the rules - there may be restrictions on pets and how you use areas of the development.
Triple check your contract
Get good independent legal advice. Make sure there is a solicitor's approval clause in the contract, and if not, ask for it to be inserted. Ask where the deposit will be held, what happens to the accrued interest, what is the length of the conditional period, if there's a sunset date (when the development has to be finished by) and what happens if extra time is needed?
Security and safety
Ask about security and safety features, such as sprinklers, fire escapes and extinguishers. Make sure the developer isn't cutting corners.
What will I be able to customize?
Generally you should be able to make some choices about your finished home, however every developer has different package options which you will need to review. Whether it’s carpet, colour, tiling or maybe your garden landscaping, find out where you’ll be able to have some input and inject your personality into your new space.
What included in the property?
Most often the finishes and fixtures that will be included in your new house will all be laid out in your agreement. Make sure you know exactly what’s going to be included, right down to the first and second choices for the appliance brands. Consider if there are costs for additional fixtures and finishes, or for replacing appliances that aren’t up to scratch, as this could very quickly blow your budget.
What if somethings not right?
Before you take possession of your finished home, you may have the chance to make a pre-inspection to check for defects, which is also a great time to make sure you have the fittings and appliances that you’re expecting. Your contract should set out your rights should any defects be found – and ideally the developer and builder should resolve these completely before you take possession and move in.
