THE money TIP

CityPress - - Business -

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.

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