Your Guide to Buying Off-Plan

One of the best ways to build your property portfolio is to buy direct from the developer ‘off-plan’. By purchasing before building begins, you can take advantage of special pre-construction prices and benefit from capital growth during the build-time.

The benefits of buying off-plan

• You can buy at a fixed price from a little as 5 - 10% deposit.
• There are no stage payments in the UK, and the balance is paid on completion.
• UK Stamp Duty starts at 0% for properties of up to £150,000 in regeneration areas, and 1% for those valued from £150,000 to £200,000 - which covers most investment-type property.

Buying off-plan is easy

Provided that you consider the following points, buying off-plan is relatively straightforward:

• Is the developer NHBC (or similar) registered and how long have they been established?
• Local infrastructure and regeneration plans increase property values and ‘rent-ability’. Projects in Manchester and Glasgow have led to a huge increase in demand for city-centre rental apartments. Learn more about dandara’s sites in Manchester and Glasgow.
• How much rental income can you expect to achieve?
• Will you have to manage the property yourself? dandara Lettings provides access to financial and legal advice, furniture fit-out, full tenancy and property management services.

Financing your off-plan investment

The most efficient way to invest in property and maximise your returns is through ‘gearing’, which works like this:

• Say for example you have £100,000 to invest. You use 30% as a deposit on three properties of £100,000 each, funding the remaining purchase price through a buy-to-let mortgage.
• A 70% interest-only mortgage on £100,000 at 5.75% interest costs £335 per month. Rental income must cover your monthly interest repayments, so the rent should be at least £420 per month to meet lending criteria.
• After 12 months, your equity would increase by 66%, providing a return of £28,000. (Figures based on 2006 average market growth rate of 9.6%).

---

Other related investment articles

Why invest?
Buy to Let

Why invest in Manchester
Why invest in Leeds
Why invest in Glasgow
Why invest in Jersey
Why invest in Isle of Man

---

get in touch

Find out more about off-plan opportunities from dandara Please contact our investment sales team for full details:


Mark Mckay Investment Sales Manchester
telephone: +44 161 829 3020
email: invest@dandara.com

---

contact form

Fields marked with an astetrix (*) are mandatory

Name:*


Address:
Please enter your address

Postcode:


Telephone:*


Email:*


Area of Interest:


Where did you hear about us?:


Sign up for investment newsletter?: