Buying off-plan is common practice in SouthEast Asia. It dominates the real estate industry with many developers selling a good percentage of units before the foundations of the project have started.
Securing property in this way has its benefits, especially for investment as it allows for the highest possible returns. Purchasing units early can be significantly cheaper than buying completed units and will allow for appreciation on the purchase even sooner, especially in areas with soaring land prices.
However, buying an off-plan condominium is not always without risks, and many may wonder if it is a good investment. After all, you won’t be able to see the finished product for years, and it can be not easy to check up on it while construction is underway. So keep in mind the following tips:
Find out about the developer
If you’re considering an off-plan condo investment, it is first of all essential to be confident in the developer. Check their history to see if they have ever failed to complete a project or have been late transferring units. Can they demonstrate past success in completing developments? Reputable home builders who have large portfolios should be able to do this to your satisfaction.
The sales materials and marketing photos used to promote the development and get an idea of what the condominium will look like will usually be in the form of artist renderings. Therefore you can look for photos of condominiums that have already been completed by the developer to gauge the quality the firm delivers more accurately. Even better. If possible, you can go to see a unit for sale at one of the developer’s already finished condominiums. While the layout may be different, chances are the unit size will be similar. Investigate how it looks and then compare it with marketing brochures that are likely to include graphic renderings. You’ll be able to see how close the developer comes to matching it.
Riviera group has a good track of success and reputation for delivering nicely finished condos
Check out the area and do your homework
Shrewd investors understand that they are investing not only in the project but also in its neighbourhood. Therefore it is a good idea to find out if there are any future infrastructure projects or plans to build retail or commercial centres in the area that can have a positive impact on the property’s price for the future.
Another good idea is to study the purchasing contract carefully. Pay particular attention to the default clauses and the payment plan. Using an experienced real estate agent can prevent you from making mistakes and won’t cost you any more.
What if the condominium isn’t completed or completed late?
The most daunting concern a buyer may have about investing in an off-plan condominium is that the project is not built or left derelict. It is the worst-case scenario since it means you will end up spending years in the courts fighting with the developer to get your investment back. Another worry is a possible setback in construction which can delay rental returns if you are planning on renting your unit out.
Make sure that the firm you are buying from sends out regular updates on how the project is progressing, ideally with accompanying photos and other information. It will at least provide you with some peace of mind while construction is underway. You can also regularly visit the site with the sales advisers as build work progresses to ensure nothing has been added or left off the plans.
Timing is everything to help you secure the pick of the plots
The lowest prices by the developer are at the launch of a new project, often known as off-plan. Many companies now have pre-selling periods with exclusive deals and special offers at their launch parties. The reason for this is that most developers want to realise revenue before starting construction. They are willing to offer lower prices up until the point of breaking ground to be sure that they obtain enough financing to make the project worthwhile.
Units in off-plan condominiums are almost always available on a first-come, first-serve basis, so an early bird policy will help you get the particular one you want
Arom is one of the most recent prestigious development to be launched in the sought-after Wongamat beach
Overall, buying an off-plan property can benefit both the investor and the future tenant. Still, as always the purchaser needs to conduct full due diligence on the prospective property and its developer or developer to make an informed decision.
Once you’ve bought off-plan and paid the reservation fee, use your time wisely to ensure everything is in place for your move if you are planning to use the unit to live in yourself. If you are renting out, then you can take comfort from the fact that at a time when many tenants are living in older, more run-down properties, there is an undeniable appeal to a new property which completed recently.
If you would like information on available off-plan options and to find more about the developers who offer them, ask the team at Pattaya Prestige Properties. We will be happy to help you with your due diligence.