An investor tells their story and shares their three biggest tips with property investors
Craig and Amy recently completed an off-plan property investment. We asked them if they thought it was worth it. Here are their opinion and their experience. It could help you decide if buying off-plan is what you should do.
Making the big decision to invest in off-plan property
When we first explored investing in an off-plan property, it was no more than an idea. We’d heard horror stories of massive delays and people who had lost deposits because of poor planning, so we were hesitant. However, we wanted to get our money working for us, and we wanted to investigate all investment opportunities.
Buying off-plan property is very different to investing in an existing new build property. For a start, there wasn’t a show house. We couldn’t see what our property would look like, other than to visualise it from artist’s impressions and floor plans.
The more we discussed the idea, though, the more it started to appeal. We could lock in the price, at the then current valuation. We were also offered a sizeable discount, and the stamp duty was included in the price.
After speaking to the property consultant at Gladfish, our minds were put at ease. We were confident that the area selected was a good bet, and that the property would rent to the young professionals we wanted to target as tenants. We were excited that we’d found our ideal investment. So, we paid our deposit in June 2016 – just before the Brexit vote (which didn’t go as we’d expected).
Completion date is a moving target
The thing that we’ve had to get most used to is the ‘evolving’ completion date. Our completion had been estimated as Spring 2017. We eventually completed in late summer. That was a bit of a blow. We had hoped to be renting our property by May. Having said this, financially, it has been a great deal (more about this later).
Also, while the completion date slipped, our sales progression team kept us informed throughout. So, it wasn’t a nasty surprise that completion was delayed – more of an inconvenience.
The progression team made the process a breeze
While we’re discussing the progression team, I’ve got to say it’s a great service. Buying off-plan was all new to us. It’s challenging in many ways. The conveyancing process is completely different, and there are a lot of extra requirements mortgage wise.
Our consultant at Gladfish put us in touch with the Ezytrac Sales Progression Team. They were top notch. They recommended a solicitor and a mortgage broker, both of whom have huge off-plan property experience. The sales progression manager did a lot of the donkey work, liaising between us, the broker and solicitor, and the developer. It made the investment process so much easier and less nerve-racking.
Choosing fixtures and fittings
One of the most exciting things about an off-plan property is that you get to customise the place with your choice of fixtures and fittings. We chose flooring, kitchen units, bathroom suites, white goods, and furniture. Again, the progression team were able to help us with this.
Looking at the finished property, we knew we’d made the right choice. Amy had insisted we went high-end with the finish. Being a young professional herself, she was confident that she could choose what would appeal most to our target tenants. I must give her this one – she did a cracking job.
It’s worked out better than we had hoped
Although we had to be patient, once the wait was over we soon realised what a great investment we’d made. I won’t go into the figures in detail, but the value is above where we thought it would be when we first signed the contract.
Together with the discount and early lock-in price, if we sold now, we’d make around £45,000. Not bad on our deposit of £70,000! But we don’t want to sell. It is an investment to secure our long-term future. So, we’re renting the property out, and here again, we’re doing better than we had thought we would.
Within a week of completion, our property had rented. The interest for it was tremendous, and with the competition from prospective tenants, we achieved the full rental price we had asked for. Better still, it’s more than we had budgeted in our original cash flow estimates. Because of completion delays, we had to wait an extra six months before renting. But with the help of the market, and because we’ve bought in one of the best places to invest in UK property, our investment is already cash flow positive.
Buying off-plan was an investment strategy that many people had warned us against. We’re so happy we chose to speak to the experts at Gladfish, and chose to invest. If there were three tips we would give to other investors, they would be:
- Invest in off-plan. Then be patient. Use a sales progression team, and get on with your life. Stop the worrying.
- Make sure you do your homework. Research locations, invest in the property fundamentals and buy the right property from a respected developer.
- Most importantly, get in touch with Gladfish on +44 207 923 6100. Let them take the strain while you make the gain!
What are you waiting for?
It’s great hearing from happy clients. It makes all our jobs worthwhile when we do what we set out to achieve: help people invest in property wisely and take big steps towards achieving the life they dream of.
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