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Property -> Buying your home 'off-plan'

By Louise Druce (March 2005)

Offplan buyers can watch their homes take shape from the ground up.Some say house prices are about to drop, others say they are rising. And amid the confusion, the temptation to snap up your home while the going is good has never been greater. But how to do it there's nothing suitable on the market? One increasingly popular option is the 'off-plan' purchase, in which you buy a house on a new development without having actually seen your bricks and mortar.

Developers say that buying in this way gives you a vital early foothold in a new development and can save you cash in the long run. But is it worth the wait?

As with buying any property, there are always risks. The National House Building Council (NHBC) says: "Off-plan homes have all the attractions associated with new houses. Freshly decorated rooms need only minimal maintenance, and energy efficient heating systems and good insulation mean that running costs are low.

"Buying off plan avoids the threat of being gazumped and the house will be the end of the selling chain. These advantages are important but house buyers should be aware of the potential difficulties involved."

One of these potential difficulties is the fact that there isn't usually a fixed date for completion in the contract. If there are planning delays or any other hold-ups, such as bad weather while the house is being built, it could mean your moving-in date is pushed back by months.

At the opposite end of the scale, if the house is ready on schedule, it does not guarantee that the rest of the scheme will be, so you could find yourself waking up every morning in the middle of a building site until they are completed.

Also, what you see isn't always what you get. For example, you may not realise just how close the house actually is to the neighbours or be able to see the quality of the workmanship until its too late.

A spokesperson for the NHBC says: "Off-plan homes are a contract between the buyer and the builder, but if the builder has an NHBC warranty and you do have problems there is something we can do about it.

"For example, if for any reason the builder goes bust before the work has been finished, we will either make sure the house is completed so the homebuyer can still move in or we will get the deposit paid back to them.

"If, however, the completion date has not been met on time, then it is a contractual issue and we will have no sway. The homebuyer may have to get a solicitor or conveyancer involved.

"Before you agree to put a deposit down on an off-plan home, you should always check out the builder's reputation, especially if they are a small local business.

"Ask around and try to find out who else they have done work for and if they have built any homes nearby. It is also worth finding out of they are registered with us."

But, especially for first-time buyers, securing an off-plan home does come with its own benefits.

To begin with, putting down the deposit and watching your new house quite literally grow will save you the considerable hassle - and shoe leather - that other buyers have to put up with as they traipse from viewing to viewing.

And you'll also be able to relax in the knowledge that gazumping is something that only happens to other people.

There are financial benefits too. Because the price of an off-plan home is fixed at an early stage, it allows the purchaser more time to save up and arrange their mortgage.

And a fixed price doesn't mean the house value will stay the same. If house prices do keep rising, then off-plan buyers could be quids in before they even unlock their new front door.

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