Little Piece of Heaven : Off the Plan?

Off the plan is the term given for property purchase prior to built. There are many risks that comes with off the plan but the main one is the developer/builder cabut (ran off) before completion and you are left with potential druggie lair or arms dealing venue.

However unlike Bolehland where it is progressive payment, in Koala land, you only have to give 5% - 10% and you can pay the rest upon completion. Even then if the developer cabut you can still get the money back after sunset clause expires. You can still adequately recover your losses. Note sunset clause can be used against you as well. Will explain further.

A lot of the older generation tut tut when youngsters like me ( cough cough ~) wants to go with off the plan. But then they have a bigger reserve and can afford something that is already built. As the house price inflates like my weight, it is getting harder and harder to save at a faster rate. Unless you are a doctor or a brick layer. In both cases you won't be reading this entry.

My sister said I buy house like I buy shirt. Nothing motivates you like depending on someone's goodwill for shelter. While my landlord is the best of the best, you will worry one day there will be friction and you will part on bad terms not to mention you should leave before goodwill is exhausted. I have been contemplating my financials while keeping a loose eye on the property market, often with despair that I might need to rent before I can afford anything. But lo behold.....~ there is a burst of development lately around our neighborhood and we are still far enough geographically for it to be affordable to me. 

So what makes me jump into the property market with an off the plan

1. Stamp duty concessions. It can save you up to 90% depending on building progress. 
2. You may alter some of the design like location of doors, floor tiles etc.. but usually comes with cost. If you don't have the budget like me, live with the design. 
3. First Home Owner Grant of 10k (for VIC). There use to be more benefits than this from the government but this all that is left. Only applicable to first home owner buyer. Not applicable for investment property. With the government going into a widening deficit hole, it's a matter of time before they withdraw this one as well.
4. First time home buyer stamp duty savings. That is 50% in savings. 50% is a lot considering stamp duties is usually >10k. This plus #1 will give you massive savings in stamp duty. Again a government incentive. Get it before it is withdrawn.
5. I found a good unit that is both affordable and in good location. It has projected capital growth given the area it is located at.
6. It is almost completed, hence mitigating the risk of developer running away while still providing some form of stamp duty savings.
7. I plan to move out of current place by end of this year.
8. Interest rate is very low right now which translate to cheaper borrowing. However this will not last forever. 

 So if you nod your head while reading this, you will want to read the future posts :) 

Stay tuned as this Pig will give you her experience while she is counting down to her little piece of heaven....