Buying off the plan is an attractive option for many first home buyers. The property price is often lower than equivalent established homes, and you are buying the dream of moving into a brand new dwelling. But like any major investment, there are things to think about before diving in head first.

Buying off plan

To help you, we’ve put together a list of things to consider before buying off the plan.

Location, location

First, you need to consider the area you are buying into. Do your research to find out what the property market is like. Look at local market trends, and the possibility of future developments in the area. Remember that the value of your property will be affected by supply and demand.

The other location factor to consider is where on the plan your property is located. Generally, it’s a case of first in, best dressed. The penthouses, or houses with best aspect, and low noise levels will tend to go first. Early buyers often get the best price because developers need to cover upfront costs as quickly as possible. Other location factors to consider include distance from main roads, view, slope and lot size.

Home warranty insurance

The developer is legally obligated to provide home warranty insurance before you enter a contract. This way, you are protected if damages occur during development, or work is not completed according to the agreed terms. Bear in mind though that residential developments higher than three-storeys are exempt from home warranty insurance.

Financing your home

Often, states and territories often offer incentives for buying off the plan, to stimulate construction economy, so check what is available.

There are pros and cons to buying sight unseen. One benefit is that you’ll likely pay a lower price. And you will only need to pay the deposit, which is usually around 10 per cent of the value, until the build is complete, and the property is settled. The risk is that you might not be eligible for the loan at the time of settlement, due to changed circumstances either by yourself or your lender.


The main risk of buying sight unseen is that the end product might be different to what you expect. It’s important that you closely review the quality, brand and model of all fittings, fixtures, features and materials used. There is some flexibility for the developer to make changes, but the terms of flexibility should be clearly stipulated in the contract.

Make sure you research the credibility of the developer before signing a contract.

Legal advice

Seek independent legal advice before entering into a contract to purchase off the plan. The contract will differ from a normal property purchase. It is important that inclusions and warranties are clearly agreed upon, and there is no confusion about the terms. You also need to know what happens if the build is delayed, the product inadequate, or if unexpected circumstances like floods or storms, damage the property.

Speak to your Smartline Adviser for more information.

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DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.