Accommodation is a basic need of life. Everyone wants to live in a safe and comfortable space, and this is why the demand and cost of accommodation is ever increasing. As a result of this, the real estate industry has experienced a major boom in recent years leading to diverse investment opportunities, strategies and so on.
There has also been a rise in creative and strategic ways of investing in real estate and property investment plans have not been left out as well. Understanding property plans is necessary for every prospective investor in the real estate sector so as to know which would be most preferable.
See also Beginner Tips for Real Estate Investors
What is Off-Plan Property Investment?
Off-Plan property investment is done when the property or building is still under construction while it is up for sale. In this type of investment plan, prospective investors are usually shown pictorial views and videos of what the property will look like after completion. They are also informed about proposed features, architectural and interior designs to be done on the building.
Pros and Cons of Off-Plan Property Investment
Off-Plan property investment as every other real estate platform comes with its pros and cons. Some of the pros are;
- You get to invest in the property at a more affordable price than it would cost after completion.
- Your profit margin might be much higher after the property is completed.
- You do not have to worry about the construction process and all its intricacies. The real estate development company takes charge of that for you.
- You also have the opportunity to make payment in installments giving you time to plan your finances and save too.
- You get to make suggestions on how you want the design to be such as spacing, interior decor, finishes and so on.
- You are aware of the type of construction materials being used and can ensure they are of good quality.
Cons of Investing in Off-Plan Property
Despite its many benefits, investing in Off-Plan property has its own risks as well. Some of the cons are;
- The real estate company can falter on their promise and not deliver within the stipulated time. This could lead to lots of disruptions and also loss of money.
- The finished property might not turn out as promised. This could also affect profit and initial purpose of investing in the property.
How to Invest in Off-Plan Property Investment
When investing in off-plan property, one important thing you must do is to Research. You should conduct extensive research on certain areas before committing yourself to an off-plan property investment platform.
Research The Company
You should conduct thorough and adequate research about the company that is developing or managing the property under construction. Check if the company is legitimate and has a track record of delivering on the timelines stated.
Research the Property Location
You should also research the location of the property to see if it suits your intended purpose for investing in the property. Find out if it’s a secure area that would yield the expected profit.
Follow Due Process
Also make sure that you don’t cut corners in trying to invest in off-plan property. Thoroughly go through the contract to find out the estimated time of delivery and any other important information. You could also employ the services of a real estate lawyer to guide you.
Check out Why You Need a Real Estate Lawyer
As a real estate investor, you have to take into cognisance your budget and what type of payment plan works for you so you do not get stuck midway. Off-Plan properties are a good way to start investing in real estate if you do not have a bulk of the money to pay all at once. What’s important is that you are investing in the right property that will give you the expected returns.
At MKH Investment, we offer a wide range of real estate services and we can help you get started on investing in the real estate industry. We also have off-plan properties that are available for you to invest in. You can contact us here for more information.