As discussed in Part 1 of this article, buying a property “Off the Plan” is the purchase of a property before its completion. With regard to the numerous disadvantages often associated with buying “Off the Plan” as detailed in Part 1, why is it still such a common way for property to be purchased? Why are record numbers of apartments being purchased “Off the Plan”, what are the advantages and how do you know if it is the right option for you?

The advantages of buying “Off the Plan”

There are a number of extremely appealing advantages for the purchaser when buying a property “Off the Plan.” These include:

  • Lock in the (potentially discounted) price. One of the main advantages of purchasing “Off the Plan” is that the purchaser will be paying the current market value for the property. This presents dual advantages. Firstly, the purchaser knows the exact amount of money they are paying years before they need to pay it- leaving time to organize how to best finance of the property. Secondly, in the event that the property market rises in value over the time it takes for the property to be completed, the property will be worth more than was paid for it by the time it is completed- but the purchaser will still pay the original purchase price. (However, if the inverse occurs and the property market falls, the property may be worth less than the original purchase price, and the purchaser will still have to pay the full amount.)
  • A small initial outlay for a high value asset. While a deposit (usually of around 10% of the full purchase price) needs to be paid to secure the property, the full balance of the purchase price does not need to be paid until the property has been completed. This allows purchasers to save money for a longer period, thereby reducing the amount they must borrow under a mortgage, as well as giving them a longer period of time to shop around for a mortgage that suits them best.
  • Tax advantages. In many states (including Victoria) there are significant tax advantages when purchasing “Off the Plan” as compared to purchasing an already completed dwelling. As well as a significant reduction in the amount of payable stamp duty, purchasers may be able to receive tax deductions for the depreciation of fixtures and fittings within the property – however this needs to be assessed on a case-by-case basis
  • Builder warranties and guarantees. All newly completed dwellings in Australia are subject to warranties and guarantees that protect the purchaser against defects in the structure of the premises. In the event that a property purchased “Off the Plan” has any structural faults, it is the obligation of the builder to repair them.
  • Customisation. When purchasing a property that has already been completed or lived in, the purchaser will generally have to accept the property ‘as is.’ Many “Off the Plan” properties offer a far higher degree of customisation, including allowing the purchaser to alter colour schemes, the fixtures and fittings, the finishes and the layouts that will make up the completed property. However, it is important to note that the purchaser’s rights in this regard will be limited by the contract.



As can be seen over the two parts of this article, purchasing a property “Off the Plan” is subject to some fantastic benefits, and some large risks. Determining whether this is the correct option for any particular purchaser is largely dependent upon their individual situation, as well as their appetite for risk. No two “Off the Plan” developments are exactly the same, and many factors, including the reputation of the developer, the current state of the property market, the level of detail in the contract and any protections available to the purchaser are all essential considerations in determining whether a purchaser should go ahead with purchasing “Off the Plan.” Due to the complexity of the contracts involved and the large amounts of money that can be at stake, it is essential to seek legal advice before moving forward with an “Off the Plan” purchase. If you are considering purchasing a property “Off the Plan”, or have any questions about this article, please get in contact with us on 03 8877 6888.


Disclaimer: This article contains general information only and is not intended to be a substitute for obtaining legal advice.