A pre-sale property, also known as a pre-construction or off-plan property, is a real estate unit that is sold before it is completed and ready for occupancy. Buyers purchase these properties based on architectural plans and specifications.
Buying a pre-sale property often allows buyers to secure a property at a lower price than when it is completed. It also provides the opportunity to customize finishes, and there may be potential for appreciation by the time the project is finished.
Timelines vary, but pre-sale properties are typically sold before construction starts and can take a couple of years to complete. The timeline depends on factors like the size of the project, permitting, and construction schedules.
In most cases the deposits are between 5%-25% depending on the development.The deposit structure for pre-sale properties varies but typically involves making a series of installment payments leading up to the completion of the project. It's crucial to understand the deposit structure outlined in the purchase agreement.
Many pre-sale properties offer customization options for finishes, appliances, and sometimes even floor plans. Buyers should inquire about customization opportunities during the purchasing process.
Financing for pre-sale properties is similar to other real estate purchases, but you do not require a mortgage at the time of securing the pre-sale contract, you will only require the mortgage upon completion of the unit. It's essential to work with a mortgage advisor familiar with pre-sale financing.
Like any investment, there are risks. Delays in construction, changes to the final product, or market fluctuations can impact the value. Buyers should thoroughly research the developer's reputation and the terms of the purchase agreement.