The Pros and Cons of Buying Off-Plan Properties in Birmingham
Looking for off-plan properties in Birmingham? Before you invest, take the time to understand the pros and cons in this handy guide.
The number of people moving into new builds is on the rise.
According to Hamptons International research, over a third of new homes built in England and Wales last year were bought off-plan.
And we’re not surprised, as first-time buyers and buy-to-let investors look to profit in a tough market.
But what should you look out for when scouring off-plan properties in Birmingham? Discover the pros and cons and uncover whether it’s right for you in this guide.
What is buying an off-plan?
Buying off-plan means buying a property before it’s built and finished.
This option for buying is becoming increasingly popular and has been encouraged by government schemes like First Homes and Help to Buy options.
As of 2021, 75% of investors opt to invest in off-plan properties, as they become increasingly confident about the market growth and high returns on this type of property plan.
Buying a property before you’ve looked at it yourself might sound risky, but it can have benefits if you’re buying in a market where property prices are rising, and more homes are required.
But before you decide to buy an off-plan property, it’s best to understand the ins and outs of what makes it worthwhile and the knock-on effect it might have if the process doesn’t run so smoothly.
Why buying off-plan is good and bad
Like with most things, there are positives and negatives.
Before buying an off-plan property, it’s best to understand what makes it worthwhile and what to be ready for if the process doesn’t run smoothly.
We’ve listed the pros and cons of buying an off-plan property to make the decision even easier for you during a time of economic fluctuation and difficulty for many.
The pros of buying an off-plan property in Birmingham
- Birmingham is an up-and-coming city. As one of the most popular cities in the UK, Birmingham is the newest hotspot for off-plan buyers seeking a more affordable city life.
- Your new home might be worth more by the time you move in.
- Buying off-plan might help you save money, as prices are set and in place before completion.
- There’s sometimes the option to add personal touches.
- You’ll receive guarantees – depending on the developers and sellers.
- There’s time to save for home interior items whilst the property is under construction.
- The properties are usually built in areas of demand.
- Off-plan homes are new, so they’re energy efficient.
- Depending on the developer and the property, some off-plan properties have staged payment options.
The cons of buying an off-plan in Birmingham
- Off-plan builds can often face delays, which can affect the mortgage. You might find yourself reapplying as mortgage agreements are only valid for six months.
- Excessive delays could even result in the housing market falling, losing you money. It’s important to study the market before purchasing.
- Large developments make building properties unattractive.
- Look out for building issues and get an architect or different builder to check the plans.
- Find a trusted developer. There are a lot of property developer cowboys out there, and some may go bust. So, it’s essential to research and find an established developer.
- You can lose your deposit if you pull out of the property.
- Many lenders don’t offer mortgages designed for off-plan builds.
It’s beneficial to get as much information and conduct thorough research and market analysis before deciding on a type of property.
Most importantly, check the track record of the Birmingham-based developer to minimise the risks.
Do most developers offer off-plan properties?
Developers will offer off-plan properties, but before you go with the first company you see on Google, there are a few things to consider.
When buying earlier in the development process, developers will pick the best plot, and some can offer discounts on purchase prices.
You must ask your property solicitor to check the property development company has insurance in the case of failure to complete the development and to safeguard against the company going bust.
But as we’ve previously mentioned, researching to find the best property developer is incredibly important for the smooth running of your buying process.
You must find a reliable company with previous development history and a trustworthy portfolio.
From plan to a home – the journey of buying an off-plan property
As the demand for property development and housing refurbishment continues to rise in Birmingham, we’re passionate about building more sustainable and affordable housing and living solutions in the second-largest city in the UK.
At Vivante Homes, our work is always completed to the highest specifications to ensure the properties stand the test of time.
So, whether you need a hand designing, planning, or constructing a project, we are a trusted and established housing developer ready at hand.
Get in touch to speak to our team of housebuilders and architects.
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