Buying off the Plan
Buying Property Off the Plan
Buying a property off the plan means you are purchasing an apartment or house that is yet to be constructed or is in the process of being constructed.
The decision to buy a property off the plan is based on a perception of the finished product through building plans, designs and specifications. Given the nature of this type of purchase, special considerations must be made in addition to the usual matters typical of purchasing existing property.
If you are considering purchasing a property off the plan, our experienced Sydney property and conveyancing lawyers would be more than happy to assist. You might also like to refer to our page ‘Buying a residential property’ which gives an overview of the conveyancing process. You will find a lot of this information relevant once construction of your property is completed. In the meantime, the following are some important matters unique to off the plan purchases.
Reviewing the contracts
A contract for an off the plan property is often lengthier than a contract for an existing property. The contract is also drafted mostly in favour of the property developer, so purchasers need to be aware of important terms and special conditions to avoid any nasty surprises.
If you are considering purchasing off the plan, we recommend you get the contract reviewed as soon as you find a property you are interested in. Our Sydney property and conveyancing lawyers will go through the contract in detail, explain the extensive terms and conditions and provide guidance so you can make an informed decision. Get in touch with us on 02 9262 4003 for a confidential discussion or submit an online enquiry.
Sunset date
The construction time of a development can vary from a few months to a few years. As the timeframe of any development is uncertain, it is important to know the sunset date, which is the date the development must be completed by. The contract will also contain provisions where the developer may extend the sunset date at their discretion if delays occur outside of their control.
Strata plan
For an off the plan apartment, the contract must contain a draft strata plan showing the location and area size of the apartment. If a car space and/or storage space are also included, this may not be allocated at the time of purchasing the property. If there is a preference on location of the car space and/or storage space, this should be negotiated and noted in the contract.
Schedule of finishes for the property
Depending how far along the developer is in the construction process, purchasers may have some input as to the design and finishes of the property. This may include a colour scheme and a selection of inclusions for the property. Some developers may even offer upgrades to existing finishes, but for an additional cost.
Variations to the property
Off the plan contracts give the developer flexibility to make variations to the property. Some of these variations have to do with an outside authority (for example, council or engineering requirements) and some variations have to do with availability of materials (for example, if an appliance is sold out or discontinued, the developer may replace it with an appliance of equivalent quality.
Settlement
It is important to note for off the plan properties that settlement does not take place when construction of the property is finished.
There are usually a number of other events which must be triggered before settlement can take place. If more than one event is required to call for settlement, then the settlement date is calculated on whatever occurs the latest.
For new houses, an Occupation Certificate (which is a certificate certifying that the property is safe to live in) must be provided and in the case where land is also being subdivided, the new deposited plan must also be registered.
For new apartments, settlement can be called once the Occupation Certificate is provided and the strata plan is registered.
In NSW, written notice must be given to the purchaser’s solicitor or conveyancer of these events occurring. The contract will state how much notice is required, but will generally be 14 or 21 days.
To learn more about off the plan properties, refer to our article: “Purchasing an off the plan property? Here’s what you need to know.”
Considering purchasing a property off the plan?
If you would like to learn more about purchasing an off the plan property and your rights and obligations, our experienced and approachable property and conveyancing lawyers are here to assist.
Get in touch with us today on 02 9262 4003 to discuss, or submit an online enquiry.
