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5 Things to Know About Buying Off-Plan Property

Category : Buying Real Estate | Posted On 2018-06-20 00:00:00

5 Things to Know About Buying Off-Plan Property


Purchasing property pre-construction is referred to as buying off-plan and it is a common practice in Thailand. It is also common for a property developer to start construction of the project while still referring to it as off-plan.  In this sense, the term off-plan property is used in a general sense to refer to properties that are not yet completed by the developer.

When purchasing an off-plan property, it is important to understand that the developer is assuming full responsibility for the construction of the project. Therefore, it is essential to be familiar with these 5 points before moving forward with buying off-plan property.

Point #1

When buying an off-plan property it is essential to purchase from a reputable developer with a solid track record. This will greatly minimize your risks. Off-plan property is basically buying the rights to a “property” that has yet to be built. A good realtor can help shorten the process of finding these reputable developers. You will want to know about prior projects and the financial health of the developer. Most developers secure funding before they start the project, but you will want to make sure to know that if the units are not 100% sold, they will still complete the project.

Point #2

When buying a condominium off-plan, choose to work with only “condominium registered” developments. The developer will have to obtain a registered condominium license which is quite cumbersome. This also means that they will be governed by legislation contained in the Thai Condominium Act which provides a greater degree of consumer protection for buyers.

Point #3

When purchasing an off-plan property, it’s important to understand that the developer is assuming responsibility for purchasing land, subdivision, and all issues relating to access and utilities and full accountability for construction and project management. Bypassing responsibility to a property developer for these tasks, you are largely or wholly giving up control over their implementation. Make sure that the developer is qualified.

Point #4

It does, however, come with its benefits. Buying off-plan property is a great way to save money. On average, you can save anywhere between 10% to 40% off market prices. Some developers refer to this as early bird marketing but most developers call it off-plan pricing. You can watch as your unit increases in value as each phase is released. Properties sold at the off-plan stage are typically sold at a discount to market value, which allows purchasers to lock in a future capital gain.

Buying off-plan typically gives you more choices. You can choose a high floor in a condominium development or a corner unit. You can choose the best plot in a villa development. Many developers will offer choices of tiles and layouts. These preferences are personal choices that are made easier by buying off-plan.

Another principal benefit is that you are getting a new property with full warranties. 

Buying an off-plan property from the developer also has the advantage that, once you have signed the contract, the price is fixed.

Point #5

Mortgages and financing for ex-pats (foreigners) in Thailand can be extremely limited. Typically Thai Banks will only lend to foreigners who live and work here and qualify. We are starting to see more international banks lend money like UOB and ICBC. However, purchasing off-plan provides buyers a payment plan that corresponds to the construction progress. In many cases, the purchase can be spread over 2-3 years and additional terms can be negotiated.

These off-plan payment plans are interest-free.

Growth Expectations

  • ✅  Expansion of Phuket International Airport. The planned increase in passenger traffic from 8 to 20 millions passengers a year.
  • ✅  Infrastructure development including light rail, new roads and underpasses
  • ✅  Smart City expansion 4.0
  • ✅  Development and strengthening of the Association of Southeast Asian Nations (ASEAN)

We would be happy to discuss the reputable developers now building in Phuket, Thailand. Give us a call +66 93 606 0906 (WhatsApp) or contact us at [email protected] for more information.



 


Phuket Realtor
David Henry
David Henry is known for his integrity, high energy and hard work which goes into every detail or your real estate transaction at Phuket Realtor. David grew up in the Boston area and started as a realtor in his 20's. With over 30 years of experience in real estate, he has now started one of the best independent real estate agencies in Thailand, Phuket Realtor.

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