Proposals for 30 projects totalling over 3000 units – including fake beaches and rooftop cinemas – have been lodged with City of Sydney Council, according to recent reports, while off-the-plan sales have been going through the roof.
A smart off-the-plan purchase may be the best investment you ever make … provided you’ve done your homework. Here’s a six-point plan to help you get the apartment of your dreams.
1. The lure of organic solar-powered vegetable gardens on the roof may be pie in the sky. Ask for written guarantees: proposals that aren’t part of the legal offer can be changed in a blink.
2. The promise of low levies is often meaningless. Levies are determined by the cost of running the building, including lifts, pools, electricity and management, cleaning and maintenance contracts, divided (roughly) by the number of units. Those low levies will soar after the first year if costs have been hidden or underestimated.
3. Make sure building management rights haven’t been pre-sold to a company that has to screw excessive fees out of owners just to get back the money they paid, and then make a profit too.
4. Remember there is no warranty on strata blocks over three storeys high and you may have to take expensive legal action to force developers to fix building defects. Get your solicitor to check if the developer has a history of fighting defects claims. If so, maybe give them a wide berth.
5. Don’t assume the value of the property will rise. Some developers factor potential “windfall” into their prices – why should you benefit when they could have the money?
6. The cost of cash-back and free furniture packages will probably come off the value of your unit when you try to sell it. There is no such thing as a free lunch in property.
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