Defining off-plan
When you buy a property off plan, you’re purchasing a home before it’s been built or completed. This means you’ll be making decisions based on floor plans, computer-generated images, and show homes rather than viewing the actual property.
Many buyers choose this option to secure a new build at an early stage, potentially getting a better price and the chance to customise certain elements. However, buying off plan requires careful consideration of the risks involved and thorough research before committing.
Key point – Always check the developer’s track record and financial stability before committing to an off-plan purchase.
Benefits of buying off-plan
Buying a property before it’s built offers several advantages:
| Benefit | Details |
|---|---|
| Early-bird pricing | Developers often offer lower prices to early buyers to secure funding and build momentum for their projects |
| Potential capital growth | If property values rise during construction, you might gain equity before you even move in |
| Customisation options | You may be able to choose fixtures, fittings and sometimes layouts, creating a home that meets your specific needs |
| New build warranties | New properties come with warranties like the 10-year NHBC guarantee that protect against structural defects |
| Energy efficiency | New builds typically have better energy ratings than older properties, potentially saving you money on bills |
The buying process
The process of buying off plan differs from purchasing an existing property:
- Research the developer – Check their previous projects, financial stability, and reviews from other buyers
- Visit the site and show home – See the location and get a feel for the quality of work
- Reserve your plot – Pay a reservation fee to secure your chosen property
- Arrange a mortgage – Get a mortgage in principle, but be aware that most lenders’ offers last only 3-6 months
- Instruct a solicitor – Choose someone with experience in new build purchases
- Exchange contracts – This typically happens 28 days after reservation
- Construction period – Regular site visits can help you monitor progress
- Snagging survey – Arrange this before completion to identify any issues
- Completion – Once the property is ready, you’ll pay the remaining balance and receive the keys
Protecting your investment
When buying off plan, taking steps to protect yourself is crucial:
| Protection measure | How it helps |
|---|---|
| Use a specialist solicitor | They’ll check contracts thoroughly and look for clauses that could work against you |
| Get a mortgage in principle | This confirms what you can borrow, but remember you may need to reapply if construction takes longer than expected |
| Check the small print | Be clear about what’s included in the specification and what costs extra |
| Include a long-stop date | This gives you the right to withdraw if the property isn’t ready by a certain date |
| Pay your deposit to a solicitor | Never pay directly to a developer without protection |
| Ask about the warranty | Ensure the property comes with an NHBC or similar warranty |
Key point: Always include a ‘long-stop date’ in your contract that allows you to withdraw from the purchase if completion is delayed beyond a certain point.
How to assess a development
Before committing to an off-plan purchase:
| Assessment area | What to check |
|---|---|
| Location research | Visit at different times of day to check noise levels, traffic, and amenities |
| Developer research | Look at their previous developments and speak to residents if possible |
| Planning permission | Check the approved plans and if there are any conditions attached |
| Lease details | For leasehold properties, understand ground rent and service charges |
| Specification quality | Get a detailed list of what’s included and the brands/quality of fixtures and fittings |
| Future developments | Research planning applications in the area that might affect your property’s value |
| Transport links | Check current and planned transport infrastructure |
Managing the waiting period
The time between exchange and completion can be lengthy. During this period:
- Stay in regular contact with the developer for progress updates
- Visit the site regularly to monitor construction
- Keep your mortgage adviser updated about timelines
- Save additional funds for potential upgrades or extras
- Research the local area further to prepare for your move
- Plan your moving logistics well in advance
Key point – Take photos during site visits to document progress and have evidence of the build quality and any concerns.
