At a time when property prices are sky rocketing it helps to explore all the available options when looking to buy a new home.
There are a number of ways you could save money and reduce you home loan amount. One increasingly popular option is to buy-off-plan.
New housing developments are always being built and if youâ€™re familiar with the area it could be wise to approach the developer and put in an offer to purchase before the development has been completed.
Off-plan purchases are usually much cheaper, and by buying off plan you will also avoid the added transfer costs.
When buying off plan you will be presented with building plans, it is then up to you to decide whether the home will suit your needs in terms of size and design.
The major difference between buying off-plan and buying existing houses are the factors which determine the prices. Prices of existing homes are primarily determined by supply and demand whereas the prices of new developments are determined by the building, labour and material costs.
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Advantages of Buying Off-Plan
Smaller Deposits – The advantages of buying a new home off-plan is that the initial deposit required is considerably lower.
Delayed Occupation â€“ Because you will need to wait until the development has been completed you will be able to use this extra time to save up for the purchase. Which means youâ€™ll be paying off a smaller Home Loan.
No Transfer Costs â€“ The developer pays VAT on the transaction instead of you paying transfer duty. All costs should be included in the quote price, making it even more palatable to you as a private buyer.
Home Loans â€“ because youâ€™re buying from a developer and therefore are not liable for any transfer of ownership costs, you can apply for a full 100% home loan and not have to worry about finding extra funds to cover these costs.
Apply for a Home Loan Online at www.ibo.com â€“ one of South Africaâ€™s leading online mortgage originators.
Although there are many advantages to buying a new home off-plan you need to realize that there are some risks involved too.
Before you decide to buy, check whether the developer is a member of the Building Industries Federation and ask for a list of contactable references.
For more information on buying a home off-plan or how to go about applying for finance to a new development complete this online form and a consultant will contact you immediately.