The Benefits of Investing Early. How Off-the-Plan Purchases Appreciate in Value.

In today’s competitive property market, buying a home that doesn’t yet exist might sound like a risky proposition. However, more and more buyers and investors are discovering the remarkable benefits of purchasing off-the-plan properties. Whether you’re a first-time buyer or a seasoned investor, buying off-the-plan offers several significant advantages that established properties simply can’t match.

In Melbourne, Norus Projects is a trusted developer, known for delivering high-quality off-the-plan properties that promise comfort and convenience with substantial financial benefits. From capital growth potential to stamp duty savings, here are some of the key reasons why purchasing off-the-plan early might be the smartest decision you make in your property journey.

Significant Stamp Duty Savings

One of the most compelling reasons to consider buying off-the-plan is the potential for significant stamp duty savings, especially in Victoria. These savings can benefit both first-home buyers (FHBs) and other purchasers, though the incentives vary.

First-Home Buyers (FHBs)

First-home buyers stand to benefit the most from stamp duty exemptions and concessions. In Victoria:

• The First Home Buyer Duty Exemption applies to properties with a dutiable value capped at $600,000, meaning no stamp duty is payable.
• A concession applies for properties valued between $601,000 and $750,000, reducing the amount of stamp duty payable.

These incentives significantly lower upfront costs, making off-the-plan purchases an attractive option for first-time buyers.

All Other Purchasers & the Temporary Stamp Duty Discount

Even for non-FHBs, off-the-plan purchases can offer considerable savings. In many states, including Victoria, stamp duty is calculated based on the property’s value at the time of signing the contract, not its completed value. Since many off-the-plan properties are only partially constructed or just land at this stage, the duty is assessed on a lower valuation.

This temporary stamp duty discount can lead to significant savings. For instance, you might pay stamp duty based on a property valued at $400,000 (land value or early construction stage) instead of its final market value of $500,000 upon completion - potentially saving thousands of dollars. These savings can free up funds for upgrades, furnishings, or other investments.

Time to Save & Prepare

Buying off-the-plan also offers a longer settlement period, typically ranging from 18 to 24 months, depending on the development. This gives you ample time to save for the balance of the purchase price, cover moving costs, or make necessary home improvements. It also provides an opportunity to plan your move, secure financing and make any personalisation choices.

The extended timeframe is particularly beneficial for first-time buyers and investors. You have more time to organise your finances and prepare for the big move. Additionally, this period can be used to sell an existing property, downsize, or make any design choices for your future home.

Capital Growth Potential

By buying off-the-plan, you’re locking in today’s price for a property that could appreciate in value by the time it’s completed. This can lead to significant capital gains. For example, you may secure an apartment for $400,000 with a 10% deposit. By the time the property is finished, if the market has grown and the property’s value increases by 10%, you’ll already be sitting on a $440,000 asset - an impressive return on your initial deposit.

While capital growth should never be the sole reason for purchasing off-the-plan, it’s a nice bonus, especially in a booming property market or an area experiencing significant infrastructure development.

Tax Benefits for Investors

For property investors, buying off-the-plan can provide lucrative tax benefits. Once construction is complete and the property is tenanted, investors can claim a range of tax deductions, including property management fees, maintenance and repairs. But the most notable benefit is depreciation.

Off-the-plan properties can claim the depreciation on over 6,000 items including; fittings and fixtures reading your taxable income and increasing cash flow and your overall investment returns.

It’s also worth noting that owners of brand-new investment properties can still claim depreciation on plant and equipment assets, a benefit no longer available to owners of second-hand properties. This legislative change makes off-the-plan properties even more attractive for investors.

Warranty & Peace of Mind

Off-the-plan properties often come with the added benefit of builder warranties. These warranties typically cover structural defects for up to seven years and non-structural defects for shorter periods (usually two years). In addition, most developments offer a 12-month defect liability period, which ensures that any minor issues with the property’s finishing or materials will be corrected at no extra cost.

For first-time buyers and investors, this added layer of security provides peace of mind that you won’t be burdened with unforeseen repair costs shortly after moving in. It’s an invaluable benefit that makes off-the-plan properties more attractive.

Lower Utility Bills & Energy Savings

Another advantage of off-the-plan properties is their energy efficiency. The National Construction Code has raised the minimum energy rating for new homes, meaning off-the-plan homes are built to higher energy standards than older homes. These properties are equipped with the latest energy-efficient appliances, insulation and systems, leading to significant savings on electricity, gas and water bills.

According to the Green Building Council of Australia, homebuyers can save up to $326 annually on their energy bills due to these improved energy standards. This is not only beneficial for owner-occupiers looking to reduce living costs but also for tenants who may be drawn to the energy-efficient features of new builds.

Flexibility to Customise Your Home

Many off-the-plan properties offer the opportunity to customise certain aspects of your home, such as floor finishes, cabinetry and appliances. If you’re an investor, this could be an opportunity to add value to the property before leasing it out. For owner-occupiers, it allows you to create a home that’s tailored to your personal preferences, making it a unique space to live.

Why Choose Norus Projects?

If you’re looking to buy off-the-plan in Melbourne, Norus Projects is an excellent choice. Known for delivering top-tier residential properties, Norus combines modern design, sustainability and functionality to create homes that meet the highest standards. From stylish apartments to family-friendly townhouses, Norus offers a range of options for buyers and investors alike.

Whether you’re purchasing your first home or adding to your investment portfolio, off-the-plan properties from Norus Projects offer significant advantages, including lower prices, tax savings, capital growth potential and more. Don’t miss the chance to secure a property in one of Melbourne’s most desirable areas.

*Please refer to the Federal and State Government websites for further information. Terms and Conditions apply to any other promotions that may be contained within this communication. Please enquire within and check with the vendor and agent for further terms and conditions. Only one promotion can be used per purchase and can not be used in conjunction with any other promotions. The information contained herein is given for general information purposes only and it is subject to change. Readers, viewers and consumers are advised to perform their own research and investigations and obtain their own financial, legal and other advice. The information and materials do not form any representation by any vendors or agents of any vendors and may include third-party opinions that do not represent the opinion of any vendor or agent. They do not form part of any contract of sale and they do not constitute legal, financial, real estate or other advice and must not be regarded or relied upon as such. No warranty is given either expressly or implied and the vendors or agents do not assume liability for negligence or otherwise with respect to the contents herein. Any plans are yet to have had their structural and services review so are subject to change prior to completion of construction. All plans, dimensions, areas and particulars herein whether by measurements or visual representation are approximate only, for general information only, and do not constitute any representation by the vendor or its agents or representatives. They do not form part of any contract of sale. Changes will undoubtedly be made during development and dimensions, fittings, finishes and specifications are therefore subject to change. Any furniture, goods and chattels depicted in this document are not included with any sale. Prospective purchasers or lessees are advised to not to rely on the information contained herein and to satisfy themselves as to the accuracy of all information given by making their own inspections, searches, inquiries and advises or as is otherwise necessary. The vendor or its agents or representatives will not be responsible for any error or misdescription which may appear. Further, the vendor or the developer or their agents or representatives do not represent, warrant and/or guarantee that the integrity of this communication has been maintained or that the communication is free of errors, virus, interception or interference. Usage of this or any other websites and materials and any associated website or material is subject to further terms and conditions.