Buying off plan is something that a lot of people find intimidating. However, you don’t need to have a lot of experience to get the benefits of this kind of investment – and it can be a really smart move. So, how do you get it right when you’re buying off plan properties in the UK?
What’s the purpose of the purchase?
It’s important to be clear about this before you buy – is it a home or an investment? This will affect the type of property that’s going to be the right choice.
Pick the right development first
Start by finding a development that hits all the right notes in terms of location, aesthetic etc. Then, after that, start looking for the perfect apartment within it.
Make sure you’ve got your financial ducks in a row
When you’re buying off plan you’ll usually have to wait until six months before completion before you’ll get a mortgage offer. Speak to a financial adviser so you know where you stand.
The process usually starts with a deposit
When you pay a deposit this will take your desired property off the market and mean you’re not likely to lose out to someone else. The deposit you pay will go towards the next down payment you’ll need to make when it goes through.
You’ll need to appoint a solicitor
This should be done when you pay your deposit so you’ve got legal support from the point at which money changes hands. You can pick your own solicitor or find one who is familiar with this type of process. Legal work on off plan properties usually takes up to three or four weeks.
The next part of the process is exchange
Exchange is the point at which contracts are exchanged and you’ll need to put down 10% of the purchase price (less the deposit that you will already have paid). At this point you may also need to factor in a number of other staged payments that will happen between now and completion.
With any off plan purchase there is going to be a time period during which the building work needs to be finished so you’ll have to factor in some waiting.
Start the financial process early enough
As mentioned, you should get your mortgage offer around six months before completion. Make sure you start the formal application process early enough so that your financials don’t hold the purchase up.
Think ahead to post-completion
This is especially important if you’re going to rent the property out. From furnishing to legal checks, you can get everything organised before the transaction completes so it’s smooth sailing once you’re the owner.
Complete on time
You’ll receive a completion notice from the developer when the transaction is ready to go through. Most completion notices give you around two weeks to get everything finalised – your financial adviser and solicitor should be able to handle most of it.
These are our tips for buying an off plan property in the UK in the most efficient way possible.