With new builds becoming more and more popular, buying off the plan is a great choice for those wanting a new property.
Buying off the plan simply means that you sign up to buy a home before it’s been built. You’ve seen the plans and how it will all look, and then you sign the sale and purchase agreement and pay your deposit at this time. The home is then built and once it’s done, you settle on the home.
For first home buyers, buying off the plan can be a great way to get a new home right off the bat. Here are a few advantages for buying off plan…..
A new home generally only requires a 10% deposit, making it a great choice for first home buyers who may not have a full 20% saved.
A brand new home means you are moving into a home which is up to date with building legislation and is warm and dry. It also means it will require less maintenance in the early years - which means more money to put towards your mortgage.
Buying off the plan is usually cheaper than buying a completed build. Some plans can also be altered, meaning you can often get exactly what you want in a home and can choose to upgrade various things.
There are also a couple of downsides to a new build which need to be considered…..
It can be slightly riskier than buying a completed home. If the build is delayed, your pre-approval for finance could run out. However this is usually easily sorted via your mortgage broker if circumstances haven’t changed.
The budget could change. This is especially something to consider at the moment with material shortages and high inflation. It’s a good idea to have a buffer available for any extra costs. If you are looking to buy the home with KiwiSaver and the First Home Grant, it’s crucial to ensure your build comes in under these price caps, otherwise you may no longer be able to use this as a method of payment.
If you are thinking about buying a house off the plans, then get in touch with our mortgage advisors here at Better Choice Home Loans. We can guide you through the whole process, and help you tap into support from KiwiSaver and the First Home Grant.
We then work with you throughout the duration of your build and into the duration of your loan.