Benefits of Buying Off-Plan: Why The Time To Invest Is Now

Category: Off-Plan Property

Looking to invest in off-plan property? Investing off-plan offers a unique set of advantages that can align perfectly with a variety of investor goals. Whether you're looking for long-term capital growth, attractive returns, or strategic portfolio diversification, the potential is immense.

In this article, we’ll explore the key benefits that make off-plan property an enticing opportunity for savvy investors like you.

Author: Sophie Hope

Digital Marketing Executive

Contact

Share this article:

Buying Off-Plan

Buying off-plan means that you are investing in the property before it has been built, whether that’s during or prior to construction taking place. Buyers may only have access to CGI’s, floor plans and specifications at times, which understandably can appear risky, however, buying off-plan can be beneficial.

Over the last few years, the off-plan development market has become increasingly popular. To secure the best off-plan investment, an area with exponential growth is important and desirable.

Cities providing successful regeneration projects have noticeably attracted numerous business opportunities and improved the lives of existing residents in both the local and regional economies, offering real value to the city in both the public and private sectors.

What Are The Key Benefits of Buying Off-Plan?

Strong Capital Growth

When you invest in property, capital growth is something that you always want to look for. Investors who have previously purchased off-plan, typically see a rise in price growth over time.

Over the period that it takes for the development to complete, you could see the property value of your investment increase before it’s ready. Off-plan properties are set below the market value due to the inconvenience caused. Therefore, we understand the hesitancy investors may have to pay for something that is not built yet. However, there is a promising outlook on the property market as property prices grow in value each year.

Regeneration projects positively affect the property market. Cities undergoing large regeneration schemes boost the economy within the area, thus strengthening the property market. Increased inward investment helps transform local amenities, offering more to residents, furthermore, increasing the value of properties within the area. Click here to read more about capital growth.

Rising coin stacks with a magnifying glass looking at the growth

Lower Deposit Prices

An additional benefit of buying off-plan is that it holds high popularity with investors, as it is a much cheaper way to buy. When investors purchase during the planning or construction stages, the value is more than likely to go up by the completion date.

In some cases, developers can offer discounts for early investors such as securing a cheaper deal, negotiating staged payment plans, and making smaller deposits. Once completion rolls around, it will automatically attract a swarm of investors, increasing demand and driving up prices.

Therefore, by investing in off-plan property, you are not only getting a cheaper alternative but there is huge potential for profit to be made as the value will increase over time.

Modern Design

The final key benefit of purchasing off-plan is the attractive, modern design. When purchasing a development off-plan, you, as an investor, will have the ability to choose a specific unit and its benefits. However, to secure the best unit, the sale process works on a first-come, first-served basis so you must get in there relatively quickly to secure the best deal.

To increase attractiveness, an off-plan property will have a new-build design. Off-plan properties are new or refurbished builds, which guarantees a contemporary build, benefiting from energy efficiency environmentally friendly specifications and safety standards. Modern tenants are focusing more on living in greener properties. Being a landlord for off-plan new builds almost guarantees hassle-free encounters with tenants.

Energy-Efficient

All new builds must adhere to sustainable specifications, making the developments more energy efficient. According to government guidelines, new tenancies in the UK must have an Energy Performance Certificate (EPC) rating of C or above from 2025. Some landlords are having to pay £27,000 to ensure their properties meet the new guidelines. However, new builds are now being designed with this in mind, creating properties with energy-efficient specifications. So, investing in these developments means you do not have to spend extra to upgrade your apartments.

Most new builds are usually fitted with the latest technology, from heating systems to kitchen appliances. This is a key selling point for tenants, as the demand for energy-efficient specifications is inflating. As a result, tenants are willing to pay higher rent for newer more energy-efficient accommodations, as this will make utility bills cheaper. This is good for investors as they could secure higher yields.

Should You Consider Buying Off-Plan?

Simply put, yes. Buying off-plan has a wide range of benefits (as seen above). With the appeal of advantageous capital growth, down to the design of properties, off-plan purchasing has the potential for exponential success.

With the current market inflation, we are aware that there is hesitancy in purchasing property, however, if not now, when? Do we wait? Here’s the reality, markets rise and markets crash, but it is a gamble either way. How are we sure that prices will drop? Rather than trying to determine whether now is a good time to invest or not, our view is, that if you know what you are doing, it’s always a good time.

Working with the right developer is important, though. As with any investment, there are going to be elements of risk. Research prior to your investment is imperative. Before buying off-plan, you want to minimise potential risks by conducting extensive research on your developer.

Luckily, here at CityRise, we pride ourselves on working with developers who have had a full and complete due diligence check. We consider everything from the reputability of the developer down to the security and financial stability. We do all the hard research for you so that your process of working with us and the developers is smooth and hassle-free.

Although off-plan investment can be considered risky, the rewards excel. The risk can be managed by conducting prior, thorough research. At CityRise, our expert advisors will guide you throughout the whole process, making your property investment journey an enjoyable one.

Is Now The Time To Invest?

Long-Term Capital Growth for Property in the UK

The UK property market is expected to see consistent growth over the next five years, with property prices forecasted to rise steadily year-on-year. For 2024, experts predict a modest increase of 3%. There is expected to be further gradual gains of 2.5% by the end of 2025, 3% in 2026, 3.5% in 2027, 4% in 2028, and 5% in 2029. This long-term trajectory reflects a positive outlook for property investors, signalling an environment subject to capital appreciation.

These growth rates may appear moderate, but they highlight the UK’s resilience as a stable and reliable market for property investment. The forecasted price increases suggest that investors can expect a steady rise in property values. Offering the potential for solid returns over the coming years. While the pace of growth may not be explosive, the stability and predictability of the UK market make it a strong contender for investors seeking long-term, sustainable returns.

Lower Prices and Decreasing Mortgage Rates

As mortgage rates continue to fall, buyer confidence is expected to rise, driving increased demand for property. This surge in demand, paired with enhanced affordability, is likely to impact property values positively. By securing a property now, while prices are still lower, investors can position themselves for larger returns as market conditions improve.

Investing in off-plan properties offers huge advantages in this current market. You can secure a property at today’s reduced prices. Investors only need to arrange financing once the property is complete. This strategic approach allows you to benefit from both lower purchase costs and anticipated reductions in mortgage rates, maximising your potential returns.