How Can You Evaluate the Potential Resale Value of an Off-Plan Property?

Purchase of an off-plan property, that is an apartment that is still being built can be a profitable investment. The resale value after the completion of the project however is one of the greatest concerns the buyers have. Although off-plan investments have catchy prices and convenient payment terms, it is important to weigh in whether your investment will have decent returns in the future.

The following will give you an idea of what to expect in terms of resale should the offense turn out to be an off-plan property.

 

  1. It Is Where Location Counts

Most important determinant of future value of property is a property location. A property with ideal location will never lack customers.

  • Any closeness to main roads, business centers, schools, shopping areas etc makes it desirable in resale value.

Neighborhoods, which have future infrastructure construction (e.g. metro stations, additional roads), can be expected to show enhancement in value.

  • Count the crime rate, development of the community and general requirement of housing in that site.

Hint: capital appreciation tends to be more in the future-oriented developments.

 

  1. Developer Image

A track record and credibility of the real estate developer is very crucial in the success and future value of an off-plan property.

  • Check on previous projects: Were they on-time?
  • Evaluate the level of construction, standards of design and the completion level of the project.
  • More buyers tend to be attracted to developers who have a good image when it comes to selling them later.

Good-established developers can cause greater sense of reassurance in would-be resalers.

 

  1. Market Trends and Demand

It is necessary to realize the trends in the property market in the region.

  • Examine trends in present and future price levels in the community.
  • Good resale value may also be signified by high demand of the rental houses.
  • Keep an eye on the off-plan vs. property readiness pricing on similar localities.

Follow the trend of real estate market cycles and choose the period when the growth is expected.

  1. Buyer interest and Payment Plans

The option of flexible payments helps attract more customers, an aspect that can indirectly increase the resale prospect.

  • The financing mechanisms such as 60/40 or post-handed-over payments schemes build the possibility of accessing the property.
  • Enquire about similar units in the development whether they have already been sold- this will show confidence among buyers.

The off-plan project that becomes more attractive to investors should have investor-friendly payment terms in order to create more interest in secondary markets.

 

  1. Amenities and Design Project

Contemporary as well as well-planned communities have higher resale value. The consumers are in search of lifestyle rather than a place to live.

  • Gated communities, security, gyms, pools and green areas are very appealing.
  • Value is added through smart home functions, green architecture and green building.

Homes that are equipped with superior amenities are in a position to command higher premium resale.

 

  1. Time Schedule and Risk

Less time taken with the process of delivery minimizes the uncertainty by the investor and assists in faster resale.

  • Projects that are likely to be delivered in less than 1-2 years are desirable than those with wide delivery horizons.
  • The buyer confidence and resale potential can be reduced as a result of delay in construction.
  • Determine whether or not the developer is famous with timely delivery.

Beautiful and consistent construction schedule is another feature that makes the property attractive.

 

  1. The Area Supply

There can be excessive supply of properties so as to inhibit the resale value due to excessive competition.

  • Investigate the number of the other units under construction within the same community or region.
  • Find out if there is an influx of properties with a similar type.

Even in good locations a drop in resale prices will be possible due to low demand and high supply scenario.

 

  1. Legal and Regulatory Factor

Acquisition of registered and approved project assists in lowering legal risks.

  • Make sure that the developer and project are registered in the local property authority.
  • Enquire about disputes or delay in approvals.
  • A well-documented property is also easy to sell again.

Investors would also like to purchase legally valid properties to avoid disputes.

  1. Expected rental returns

Although rental yield is relevant even when you intend to resell your home, the yield affects the degree of desirability of a property.

  • The property is more appealing to investors the higher the rental as a percentage.
  • It can resell the properties with constant getting income at a higher cost.
  • Carry out a comparison of local rent prices on a per-square-foot basis and occupancy rates.

Long term resale value is commonly seen to be associated with rental performance.

 

  1. Differentiation and Uniqueness of the project

Why should people choose your property among others? This is a significant trigger of the resale.

Special architecture, view (e.g. of water-views, skyline), or layout design are a value addition.

 

Final Thoughts

Obtaining a resale value is an assessment regarding the future valuation of an off-plan estate, and it will combine studies on the market, and perception of the place, and confidence in the promoter. Although nothing can be done without a risk, paying specific attention to these sets of facts, you can make a wise and profitable decision.

All prior to commitments:

  • Make due diligence
  • Compare several projects
  • Consult the experts or consultants in real estate

Smartly investing in off-plan property may precondition you with good financial yields-but remember to evaluate it in all perspectives as far as its value is concerned during reselling.

Among the mentioned key points, it is also a wise idea to pay attention to the size, as well as the layout of a property. Units that have better arrangement of facilities and storage are more likely to have a larger base of buyers. In addition, look out where potential community amenities like schools, parks, shopping stores and transportation hubs will be built- they have potentials to add a lot of value in the future. Abidance by government rules, taxations, and visa reforms are also subject to change demand. The better you know it, the, more probably, you will make a resale profit.