There has been a significant rise in interest for off-plan in the last few years, and with lower purchase prices and more control, investors continually see the benefits of it. They're ideal for those who are savvy with property and have confidence in the market. However, those who are interested in off-plan investment must have a strong understanding of the industry as a whole. Any glitches in the process can have an adverse effect if due diligence isn't done correctly from the outset; this is why it's essential you know everything about off-plan property investment before going further.
What is off-plan property?
Off-plan property is a development either bought before or during the construction process. It is a relatively new strategy but effective. Despite it coming with risks, it attracts investors in their thousands as it can help secure a great deal. It is also often the case that there is potential for capital appreciation as soon as the property is completed. To better understand the process of off-plan, there are five significant stages of planning permission.
The off-plan process
Keep in mind that planning permission varies across local planning authorities, whether this is through local boroughs or district councils. The first step is when the planning permission application is sent off (the developers of your potential off-plan property will have done this before the investment process begins). The local planning authority may then hold consultations as they decide whether to grant permission to the developers of the construction. If the authority decides they're in favour of the plans, it will then proceed. However, if not, they will have to give a valid reason. Finally, the planning permission is granted, although there may often be a few conditions to meet standards. After this, the development will now have permission to start being built.
Beware of the risks
Off-plan property can be seen as a risk because the property being sold is without planning permissions; the plans can be denied at any point. Even when the planning permission is granted, there is still potential for the property to be axed or stopped. Despite this, choosing a property investment company that is aware of the market and has extensive knowledge of it, you're taking a minimal risk. RW Invest specialises in buy to let properties and has off-plan properties available in the ever-growing market. They advise new investors and can assure the benefits of off-plan investment. When choosing a company to go with, ensure you've done your research on them. Reviews on websites such as Trust Pilot can give you a deeper understanding of a company, based on client satisfaction in the past.
Confidence is key
Overall, buying an off-plan property can be exciting, and you will undoubtedly reap the rewards of getting in early and purchasing these types of developments. You will have access to more affordable property investment and gain huge capital appreciation. The key factors to consider going forward are the location of the development, the prices of similar properties, and the rental demand in the area. With this knowledge, you’re sure to succeed.