The Top Reasons to Buy an Off-The-Plan Apartment This Year

Buying off-the-plan means buying a property before it has been fully constructed, or in some cases, even commenced. While it can be daunting purchasing an off-plan apartment in Melbourne you haven’t set foot in - it’s a popular strategy among apartment buyers in Victoria that is certainly worth considering to maximise and lock in potential future capital gains at today's prices.   

If you're interested in strategies that utilise extended settlement periods to climb the ladder and secure your dream turnkey property, read our guide to learn the top tips for making sure you get the best out of your off-the-plan purchase.

1. 10% deposit with plenty of time to plan: Typically, a 10% deposit is required when buying off the plan. This upfront commitment secures your future property at today’s prices, with often 18-36 months of build time before you need to consider settlement. It’s wise to use this time to plan the sale of your existing home or finish up a lease, as well as build up your cash reserves before settlement.

Before it’s time to sign the contracts and formally agree to the terms concerning your off-the-plan apartment in Melbourne, clarify how your deposit is managed. Is it held in your agent’s trust account, or is there a clause permitting it to be released to the vendor between the exchange and completion of the development?

2.  Explore available concessions and exemptions: Victoria offers a range of various stamp duty concessions and exemptions for off-the-plan purchases. While these may offer significant reductions in the amount of duty payable at settlement, it is important that you seek independent advice on the eligibility of any potential concessions since it is invariably subject to the unique circumstances of each purchaser and the property purchased.

Additionally, you may be liable to pay GST on any new off-plan apartment in Melbourne. While this amount is often included in the purchase price, you may be responsible for paying it to the Australian Tax Office (ATO) rather than the vendor. If you need to sell a new off-plan property for any reason before construction has completed, you may also need to pay GST. For more information, review the available information at the State Revenue Office Website or consult your conveyancer or financial professional.

3. Find a trusted conveyancer: Enlisting a conveyancer is key. They navigate the legal intricacies, ensuring your contract protects your interests, particularly with clauses specific to off-the-plan purchases, like sunset clauses. They’ll also guide you through the settlement process and review the draft strata plan to ensure the exchange is as smooth as possible and that all marketed inclusions are delivered as described.

4. Be informed about your finances: It's crucial to consider that if your financial circumstances could alter between signing the contract and the settlement date, you may face challenges due to the binding nature of the unconditional contract. When buying off the plan, you may also need to consider how you will pay the remaining balance at settlement if you’re relying on the sale of another property and whether your pre-approvals are valid and have not expired. 

5. Understand owner’s corporation obligations and benefits: When buying off-the-plan, understanding your role in the owner's corporation is essential. This body manages common areas like lobbies, gardens, resident lounges, and gyms, requiring your financial contribution for upkeep. The benefits include well-maintained spaces, amenities contributing to your lifestyle and potentially enhanced property value.

6. Choose a reputable developer: Opting for a developer with a strong track record is paramount. Do they have a reputation for quality, reliability, and adherence to timelines? Is their word-of-mouth positive? And what about repeat purchasers? It’s important to do your research, looking at past projects to gauge a developer’s standard of work and the ongoing capital appreciation of their buildings in Australia.

When you’ve narrowed your search among your preferred Melbourne apartments for sale, note all the major companies involved, as the developer may not necessarily be the builder. While it’s normal for the level of finishes to differ from what was delivered on a minor scale, for various reasons, the developer may make a change to the floorplan or other specifications you might not be aware of.

That's why The Albertine by Mirvac has become a prominent address for homeowners and investors looking for the quality exemplified by the Mirvac difference. With frequent construction updates and communication between buyers and internal teams, you can be sure your off-the-plan property matches renderings, the display centre and other design and marketing material. .

7. Personalise your space: Depending on when you decide to buy in the construction cycle, it may be possible to customise some of the elements of your new home, from colour schemes to flooring materials. While your construction company can accommodate some requests for adjustments and variations, major changes may not be possible after certain stages have passed or without additional costs or delays to the timeline of your build..

8. Understanding the timeline: Reputable developers have clear policies in place to clearly communicate construction timelines and expectations if delays occur ensuring transparency and trust.

Building a house can be one of the biggest projects and costs many people will have in their lives, so it is understandable to want up-to-date information about the progress of your future home. Working with an experienced builder more often allows you to access a customer portal or other documentation, giving you an oversight of how your build is faring. Your developer may also report on when community amenities such as parks, community centres and libraries for example will be ready for you to visit.

9. Long-term considerations: Buying off-the-plan apartments in Melbourne can make a potentially rewarding investment, enabling you to purchase a property and capture the potential future resale value and rental potential.

Certain properties, such as those on corner lots with wide frontages or those closest to a park, may be seen as more favourable and competitive in a seller’s market. However, these are generally the most popular, so you’ll need to purchase quickly and early to secure your favoured position in the estate or building.
 
If you’re concerned about the future resale value of your home, working with a reputed developer and performing maintenance to keep your property in excellent condition can help you attract bids in your preferred price range. 

Discover your forever home at The Albertine

For over 50 years, Mirvac has been reimagining urban life in Australia, creating exceptional living experiences through the pursuit of quality and care in every detail.

The latest addition shaping Melbourne’s city skyline is The Albertine — a boutique address ensconced within Melbourne’s most desirable suburbs, overlooking Albert Park Lake and connected to the city's finest offerings. With a suite of amenities to enhance your lifestyle, in and out of your residence, you can get the quality home you want when buying off-the-plan.

Experience Mirvac’s quality and care in every detail by booking a visit to The Albertine Experience Gallery, located at 484 St Kilda Rd, Melbourne.