Here’s what you need to know about buying off the plan in New Zealand
$3.3billion. That’s the value of new residential building nationwide for 2016’s third quarter , according to Statistics New Zealand. Auckland made up almost $2billion of that with Christchurch close behind at $1.2billion.
Thanks to the massive amount of new homes popping up around the country, ‘buying off the plan’ is becoming increasingly popular. If you’re considering getting involved and buying straight off a developer, remember that there are risks involved and it’s not all rainbows and puppy dogs.
If you can avoid the common pitfalls, do your research and select the right property, buying off the plan could be your best option.
Check your apartments size and layout
$3.3billion. That’s the value of new residential building nationwide for 2016’s third quarter alone.
Living in a tiny shoe box listening to the cacophony of noise coming from all sides probably isn’t your idea of ‘home sweet home’. That’s why it’s essential to check the size of your new build before committing to anything.
If the developer has showrooms, it may be possible to have a look around a mockup of your apartment, where you can get a good idea of the size and shape of your space to see if it’s to your liking.
If not, check the size and floor plans closely. If you’re purchasing something under 45sqm you’re going to want to pay even more attention to the plans to make sure the little space you’ll have is used efficiently.
Keep in mind two or three sqm might be lost to cupboards, hallways and storage.
Make sure it’s soundproof
Buying off the plan is becoming increasingly popular.
When you initially commit to an off-the-plan property, you might not fully understand the extent to which sound will travel in and out of it.
The minimum according to building regulations is a sound transmission class (STC) of 55 and no less, but it’s always best to find something with a higher rating if possible. A good number to aim for is 65.
This is particularly important in small apartments, or conjoined townhouses where noise can easily travel through walls, floors and ceilings.
Research the developer
A quick Google search is often a good place to start. Use the news tab and their name and research any of their past developments, looking for controversies or past issues which will raise red flags. If you’re unsure, get in touch with a local real estate agent.
In the modern age most purchases are researched online to make sure we’re making the right choice.
Your new build should be no exception as the background and history of the developer or the development could give you an idea of what to expect in future.
The background and history of the developer or the development could give you an idea of what to expect in future.
Seek independent legal advice
Buying off the plan is a complex process that can be risky if you don’t have your wits about you.
Hire a specialist conveyancer to look over your contract and any documents concerning the body corporate.
Special care should be taken to ensure that the agreement includes maintenance provisions, so that when the buyer takes possession, they still have the chance to raise any defects with the developer and have them repaired.
As you can see buying off the plan can be a complex undertaking. But with the right advice, a lot of research and a little caution your new build purchase might just be your best yet.