It is common for condos and apartments in Brisbane to be sold before they are built. Selling starts as soon as building plans and permits are complete. Thus, you can buy a condo two, three or even five years before you can actually take possession. Why would you buy a home you cannot live in the next few years instead of one you can move in right away?
Why bother putting your money into something that you can’t already use? Money spent on buying a pre-construction condo is technically idle money. It can’t earn you interest and cannot be used in any form of business because you already paid it for something that is coming to you in the future.
So, is it wise to buy a condo at pre-sell?
The answer could be yes or no, depending on how you see real estate and your money. Here are the most common benefits of buying Brisbane apartments and condos at pre-sell;
You get the best units – The first buyers have the opportunity of taking the best units. This is a big advantage if you value your location – a south facing or north facing unit, as far away from the elevators, corner units, or take top floors! You get the floor plan that will perfectly meet your needs and the best views.
Customized Units – In many cases, builders give pre-construction buyers the opportunity to customize their units. This is something impossible when buying ready-for-occupancy units. So, whether you want your bedrooms away from the windows, need bigger bathrooms or want to increase living space by adding a loft, the options are open.
Prices are at the lowest – Developers are offering pre-selling units for as low as possible to get as many buyers as they can. On top of the lowered prices, discounts and easier payment schemes are added in to sweeten the deal. They are treating early buyers as investors as they really are. The money you will pay will be used in the construction of the condo. The more sales they have in the pre-selling phase, the less money they will need to put up, which translates to less interest expense and costs.
Great return on your investment – As soon as the building is done, remaining units are sold for regular prices. Residential condos and apartments are usually sold about 30% less in pre-selling stage compared to completed projects. Prices are bound to increase as completion nears. Consider the discount and the property appreciation as big returns on your early investment.
Easier Payment Schemes – Buying early will get you longer terms and lower prices, which means lower interest rates. Down payments can be as low as 10%. Again, this is to generate as much sales they could in the pre-selling stage. As it is harder to sell something that is not yet available, developers are doing everything they can to get you to sign up.
Now, like every investment or business venture, there are also some risks involved to paying too early for things, like a condo that is not even built. Here are some risks and drawbacks to buying pre-construction apartments;
Delayed delivery – A lot of things can happen when building apartment complexes and condo towers. The weather, financial issues, manpower, and unforeseen event can halter and/or delay the construction, resulting to either delayed or postponed delivery.
The condo turns out differently – What if the actual tower isn't as amazing as its rendering in the showroom? The ceiling aren’t that high, the easterly wind that comes with the ocean views are too strong, or the building architecture just get on your nerves.
Your needs change – Somewhere between the three year wait you got married and had a baby and would need at least two more rooms to what you’ve purchased. Or you got another job in another city. Life changes but your condo will be built as you ordered it.
Another opportunity pops up – Another condo, closer to your work place, cheaper, and with better amenities comes after you sign up for the other condo. Unless you have deep resources, buying two homes at the same time is quite impossible to financially sustain.
The good thing is that you can always avoid and minimize if not eradicate the risks. The key is doing your homework. Know the developer and research on their previous projects. Buy only from reputable builders of condos and apartments in Brisbane with good track record of previous developments. If you want to take the chance on a new, promising but unestablished company, you alleviate the risks by working with an established firm or with a real estate agent who is an expert on pre-construction condos.
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