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Many people prefer new over existing or second-hand, and this trend also applies to houses. Therefore, it is not so strange that there is always a high demand for new-build houses, while the supply is limited.
Buying a house off-plan or from a blueprint is becoming increasingly popular. But what exactly does it entail? What are the advantages and disadvantages? And why should you consider buying a new build project? This article provides a comprehensive guide to purchasing a house off-plan or from a blueprint.
What is buying a project?
This means that you buy a house before its construction is completed. This form of real estate purchase has several possible advantages, such as a lower purchase price, input in layout and finish, and using the current and modern construction materials and techniques. However, this process also carries risks, such as construction delays, price changes, construction conflicts, and in some cases even project cancellations. Therefore, it is essential to thoroughly understand the implications and details of these real estate transactions before you agree to them.
Why should you buy a new build house?
Here are some reasons why you might consider buying a project house instead of an already completed new build house or a second-hand house:
Customization: By buying off-plan or from a blueprint, you can customize the design and finish of your house to your preferences.
Lower initial price: Houses that still need to be built are usually sold at a lower price than already completed houses.
Construction warranty: New build houses have warranties on certain defects according to the Building Act (LOE).
A brand new house: By buying from a blueprint, you get a house that meets the latest standards in technology, energy efficiency, and safety.
Extra amenities: New build projects often include shared spaces, such as a swimming pool, garden, gym, etc.
Progressive payment: Payments can be made in installments.
Risks of buying off-plan
Just like any real estate transaction, there are risks associated with buying a house from a blueprint:
- Possible delays in construction.
- Economic risk if the construction company experiences financial problems.
- Changes to the original design, over which you have no control.
- Market fluctuations that can affect the value of the property.
- Not being satisfied with the builder's work.
What should you look out for when buying a house off-plan?
Here are some important considerations before you buy a house off-plan:
- Location: Choose a location that meets your needs and offers all the necessary amenities.
- Price: Compare prices and visit various construction projects before making a decision.
- Energy level of the house: Ask for the energy label to estimate heating and cooling costs.
- Consult experts: Seek advice from lawyers or real estate agents specializing in off-plan houses to determine whether you become the owner of the plot on which the house is being built before construction begins or only after the house is fully completed.
- Read the contract carefully: Pay particular attention to termination clauses, payment terms, compensation for exceeding construction time, and insurances and warranties.
- Think about your future needs: Consider how your needs and family situation might change in the future.
Tips for buying a new build house.
Before you buy an off-plan house, make sure you have clarified the following questions:
- Know the total price of the house and the additional costs.
- Understand the payment plan.
- Know the initial down payment requirements.
- Know when the expected completion date of the house is.
- Check the features of the house and the finishes.
- Research the developer and the builder, read reviews, and ask about guarantees.
- Ask for a quality report of the materials used.
- Have any legal issues regarding the land checked by your lawyer.
- Inquire about future development plans in the area.
When to apply for a mortgage when buying off-plan?
It is recommended to apply for a mortgage two to three months before the handover of the keys. Ask for advice from your (Spanish) bank or mortgage provider for this.
Payment for an off-plan house
Usually, payments are made in installments, with a down payment at the signing of the contract and the rest upon delivery, but there are also other forms possible that legally protect you in a different way. Discuss this topic with your lawyer / legal counsel to arrive at the solution that suits you.
With the above information, you have a handle to make a well-considered decision when buying a house off-plan, while minimizing the risks.
