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Advantages of Buying off the Plan Sydney (NSW)

Buying off the plan and property investment guide...

Astute property investors have long recognised the benefits of buying off the plan in Sydney. The booming city has one of the lowest vacancy rates due an increased population rate, high demand and under supply of properties in desired locations which have resulted in huge capital gains for smart investors. Here are seven good reasons why you should consider adding to your investment portfolio and buying a property off the plan in NSW.

Tax advantages

When buying a property off the plan, there are greater tax breaks which are one of the major reasons why Sydney investors prefer to buy off the plan - new apartments usually provide a higher rate of depreciation than houses or existing buildings. We provide depreciation schedules for our Sydney investment properties where possible. Loan interest and related bank fees, repairs and maintenance of fixture and fittings, insurances, agent fees and commissions and any legitimate expense incurred in running your investment property are also tax deductible. Advice from a financial adviser or accountant should be sought before committing to an off the plan purchase in NSW.

Stamp duty savings

There are enormous stamp duty savings to be made when buying a property off the plan in NSW. If the property has started development, you may have to pay a pro rata stamp duty amount. The concession is always greatest if the property is bought before construction commences. When purchasing a Sydney investment property, check with the NSW Office of State Revenue to establish the exact entitlement you will receive which will also depend on the purchase price.

Capital gains


With a delayed settlement, your investment property may experience huge capital gains from the time you have signed on the dotted line for the property and locked in the price to the time that the property is built. Keep in mind however that if prices fall, you also have to wear that risk but historically, some properties in Sydney have even doubled their value over time and investing in property in Sydney should always be a long term investment. There is also the option to resell your investment property before, during or after construction which gives you added flexibility if the market falls. Equity Equity is another driver of why smart investors buy property off the plan in Sydney as the prolonged settlement can result in instant equity as the property value grows over time. Put simple, equity is the difference between what your home is worth and how much you owe on it. So if you purchase a property off the plan in NSW and it is worth $500,000 when you first purchased it but is valued at $570,000 upon completion, you have an instant $70,000 in equity. This equity can be used to create wealth and add to your existing investment portfolio.

Time


Depending on your individual contract or agreement with the developer, you will need to put down a small deposit and pay the balance when the building has been completed. This allows you to save for a larger deposit while securing the property at today’s Sydney prices which are a major price incentive. This long term investment strategy can lead to considerable savings and you can put that money towards the deposit or buying another investment property.

Flexibility

One of the greatest benefits of buying off the plan in Sydney is that you may be able to choose from a range of properties with a superior position, aspect and floor layout depending on how quickly you jump on the opportunity. Properties which have courtyards, private entrances, larger balconies, better views or positioned on a higher floor can offer better potential for capital growth and maximise rental yields. You may also be able to choose from a range of high quality finishes and appliances to make the property even more appealing to prospective tenants.

Lower maintenance costs

Buying a property off the plan in NSW will save you money on maintenance fees as the property as all the fittings, appliances and so forth will be brand new. You will also not have to worry about larger maintenance costs such as painting of common property walls, replacing the carpets in stairwells or major landscaping until a few years when the property has depreciated. Newer properties also have increased insulation, energy-efficient heating and cooling equipment and use substantially less energy for heating, cooling, and hot water heating making the property tenant friendly and saving tenants money on utility bills.

Off-the-plan property investment can be extremely attractive for property investors, in Sydney where investors can make significant stamp duty savings and investors can get a quick return on their investment upon completion in terms of equity and high capital gains. However, you need to do your research on the location of the property; the potential for capital gains growth, average rent and yield of similar new apartments in the area and what developments are planned for the region. You also need to find a developer who is reputable, licensed and obtain legal advice before you sign the contract.

 Find Investment Property has listings for some of the best off the plan properties currently available so start searching to find your next property deal and add a Sydney off the plan property to your investment portfolio.

Find Investment Property is the best property investment resource online and features the latest new apartments and off the plan investment properties. Whether you are looking to buy investment property or looking for the best property investment research, Find Investment Property has the real estate investment properties you need.