Buying Off Plan vs. Completed

Clients often ask if it is better to buy a condo off plan or one that is completed.

When answering this question we first try to figure out what their needs are and why they are buying the condo in the first place.

Both options come with benefits and draw backs, and a lot will depend on the buyer’s risk preference and what they are buying the condo for.

If they are looking for a place to live right away obviously off plan is not for them, unless the development is just about finished and then they won’t be getting the lowest possible price.

If the buyer is not in a hurry to move in and looking for the best price then maybe off plan is the way to go.

Lets look at some of the benefits and drawbacks of buying off plan vs. completed.

Purchasing a condo off-plan has the benefits of being able to choose the best units. Usually by the time a building is completed the best available units will have already been sold. The early bird gets the worm, as the old saying goes and the early buyer gets the best units.

One good reason for buying off-plan is to generate a larger capital gain through the appreciation of the unit once the development is completed.

This is very attractive for property investors and speculators as the price can increase and provide an excellent return if they are able to sell the unit at the higher price after completion.

It is best to buy in to a new project as early as possible and take advantage of pre-launch prices. During this period the developer will still be in the process of obtaining building permits, confirming plans and getting their EIA (Environmental Impact Assessment).

Property developers want to start generating income through sales as early as possible, so they will offer buyers pre-launch incentives, usually in the form of large price discounts, guaranteed rental returns, finance options and more.

Another advantage of buying off-plan is that payments can be spread over the construction period. For condominiums this can be up to several years.

Buying off-plan can give buyers greater input into the design of their property; sometimes with buyers can purchase two adjoining units and create one larger unit. Buyers can also make decisions on décor, furnishings, bathrooms, kitchens and appliances at this early stage.

There are always risks involved when buying off plan though and we will briefly look at some of them below.

There is always a risk the project might be delayed or not complete at all, which is not a factor if the buyer is purchasing a completed property. Buying off-plan is not for the risk squeamish property buyer.

Unless the developer has a show unit or an earlier-completed development, buyers will be unsure of the quality they will get upon completion.

If a unit is completed the buyer can see, touch and feel the finished product so they know exactly what they are buying.

For property investors who are buying to generate income through rental returns, off-plan properties cannot start producing a rental income until completion. In the case of a condominium this could be two years or more. For this type of buyer, purchasing a completed property will be more suitable as it can start produce income immediately.

If you are thinking of buying a condo in the near future please stop by one of our offices and talk to one of our sales staff and let us help you decide which type of purchase will best suit your needs.

You can also email us at info@coastalrealestatepattaya.com