THE money TIP
Buying a property off-plan has plenty of advantages as you can often customise the home to suit your taste. However, there are risks when buying off-plan, and you need to be careful with your money.
Shaun Rademeyer, CEO of BetterLife Home Loans, says: “It is very important, for example, for buyers to know that they should never pay a deposit for an ‘off-plan’ home, or even sign any agreement to purchase such a home, until they have thoroughly checked the credentials of the developer and/or the builder.”
Rademeyer adds that any deposit you do put down must be held in trust by an attorney or registered estate agent, and must be repaid with interest if the development doesn’t go ahead within a specific time.
He cautions buyers to be aware of any associated costs.
“Make sure exactly what the levy payment covers – and by how much it is likely to increase once the development is finished. There could be quite a steep jump once the last unit is sold and the developer is no longer involved and no longer subsidising certain costs,” he says.