Discounts for off plan property are no true indication as to the actual value of the property nor on how good a deal you may have been offered. It’s like the value of goods in a sale: for a start is it a genuine sale or just marketing activity? Then has the vendor reduced their normal prices from the much higher RRP (Recommended Retail Price)? So when out shopping, you’d know if you got a good deal just by comparing prices in a high street.
Well the same is true of buying property. Just because you may be told that the amount is actually 20% off does not necessarily mean that you’ll get a good deal – it’s the same as in the high street if you see the 50% off closing down sale but the shop’s still there 6 months later!
It’s the net price that any investor is interested in – that’s the true price. Also, keep an eye on costs that may have to be included and then review all the prices on a spreadsheet so that you get a true cost.
Off plan discounts have been used as a mechanism to finance the purchase of property and to help the investors buy property for very little as this amount itself would be used as a 'deposit' on the property if bridging finance followed by a 'day one remortgage' was used.
If you have any doubt about the true value of a property, then ask a third party. A local estate agent could be helpful but then also a surveyor will be able to help, however one surveyor’s opinion may differ significantly from another, so that at the end of the day, any decision to proceed in a buying a property because of the savings offered must rest with the purchaser.
Return from Discounts to Property Clubs