Why downsizers should buy pre-loved rather than off-the-plan

Why downsizers should buy pre-loved rather than off-the-plan

I find baby boomers to be discerning buyers. Typically they’re downsizing from a family home and are looking for apartments with a lot of space and high quality finishes.

This level of quality isn’t easy to find in brand new property however I have had a lot of success in helping downsizers buy established property then helping them renovate it to taste.

The problem with most new apartment developments these days is that unless we are talking at the very high end of the market they are generally built as investment products for the developer to sell quickly with a high margin.

In comparison apartments built in the 60s to 90s are generally in better locations and have more focus on space and outlook.

Established blocks also tend to have higher ceilings, fewer common walls and better floor-plans while more recent developments seem to be more focussed on cramming in the maximum number of units at the expense of these important attributes. This leaves the purchasers with some not so great options to choose from.

Whilst all buildings require ongoing maintenance, generally it’s within the first five years that serious problems appear. However it can sometimes take a bit longer for major (or minor but chronic) defects to show up which may involve costly litigation with the developer and their insurers as well as expensive repairs to fix the building.  

These reasons alone are enough to avoid properties less than 10 years old in general, let alone the fact that off-the-plan property contracts often heavily favour the developer over the buyer.

Downsizers should be aware that buying off-the-plan comes with additional  risks when compared to established properties. 

For example, the developer could go bust during construction which happens more often than you might think; you could experience significant delays on the proposed settlement date; and the quality of finishes could end up being quite different to the ones you agreed to.  The apartment you have signed a contract to purchase can also vary in size by a few percent, meaning the property could end up say 5% smaller than the selling plans.

This type of result may reduce the value of the end product by hundreds of thousands of dollars and come settlement time you may or may not be able to do anything about it depending on the wording of the contract. 

Unfortunately based on numerous conversations with lawyers who handle off the plan contracts, these things happen all the time.  So if you do decide to go down this path it is essential that you hire a good property lawyer with extensive experience in off-the-plan contracts.

If you are planning on downsizing and would like help finding a quality apartment to meet your future needs then please click here to send me an email.