Buying a property or portfolio of properties “off plan” remains a popular investment strategy and for many good reasons:
- Off-plan prices are often much lower. Developers are looking to sell units quickly without the medium to long term wait of planning, building and marketing.
- The definition of off plan is land that has no structure on it and developers and investors can often secure much better financial deals on off plan investments.
- Most off plan developments are for apartments and the property can be secured with a smaller deposit than on other properties and often with favourable discounts.
As a major conurbation, Birmingham has many off plan developments – some are conversions of older properties from its long industrial heritage and others are brand new builds.
The city centre leaves investors spoiled for choice in fact with off-plan opportunities aplenty in the Jewellery Quarter, Brindley Place and the Axium development, to name just three.
What do Sourced recommend you do, if you’re looking to secure an off plan investment in Birmingham, or indeed elsewhere?
Your first step is to assess the location and neighbourhood profile. You’re probably buying off plan for long term letting and location is key to ensure high demand for your property. Is it near public transport links? Is it close to key workplaces?
Is the off plan discount generous? You may get £15,000 or £25,000 off the price for buying off plan and you may instantly recoup this and more when the building is completed. Or you may not. A 5% discount is usually achievable when reserving and further discounts or incentives may be possible for investors buying multiple units.
You need to ask questions too of the developer like: what does the price include? When will the development be completed – as noise and building disruption may deter future tenants.
A big question for you to ask when buying off plan is this: is the price fixed and how is my money protected?
You also need to find out whether the price is locked at exchange of contract stage and whether your deposit is protected if the developer folds before exchange.
At Sourced, we can help you find off plan properties and secure favourable deals for you.