Buying off-plan properties are a bit different to regular property investment purchases. The process for entering an off-plan property investment strategy requires more waiting because the property hasn’t been built yet. Usually when property investors choose to buy an off-plan property, they are looking for a good deal on the price as well as the capital appreciation that will make the property more valuable after it is completed.
Here is an easy to follow 10 step process for property investors looking to get the most out of an off the plan property.
- Find a suitable off-plan development
Do research on the location you want to target. Take into account what the property is going to be for, who is going to live in the property and how any of those people are in the location. A promising location will have high prospects, low property prices and high rental yields.
- Speak to a mortgage adviser
A mortgage adviser can help you finance your investment if you are not a cash buyer. Most off-plan student accommodation will be cash purchases. Find the right mortgage for you.
- Reserve the property
If it is an ideal location and property you should reserve the property by paying a reservation fee. This can be anything up to £1000.
- Arrange a valuation
Your mortgage lender will require a surveyor’s valuation after the offer has been made to see how much they can lend you.
- Contact a conveyancer or solicitor
A solicitor or legal specialist in property (conveyancer) will be able to guide you through the legal paperwork and requirements.
- Complete mortgage paperwork
Make sure all the mortgage paperwork is complete so you can finance your off-plan investment. You want to do this well in advance of the property completion date to avoid any issues from last minute arrangements.
- Exchange legal contracts
Your solicitor will exchange contracts with the developer or property seller to legally secure the property ownership.
- Pay the deposit
The deposit for the off-plan property investment will need to be paid. Usually it is 5-10% of the purchase price.
- Get a snagging survey
Two weeks before completion get a snagging survey to check the property for defects during construction.
- Get ready for development completion
You will be handed the keys after completion. There are two dates the developer will give you. The ‘short stop’ is the date they expect to be complete by and the ‘long stop’ is the date they must be complete by.