'Off the plans' purchases finding favour again

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Lawyers say they are seeing “off-the-plans” property purchases again – after years of none. But the trend comes with a warning.

Friday, July 27th 2012, 12:00AM 2 Comments

by The Landlord

Denise Marsden, of Alexander Dorrington, said the change was noticeable.

"We are seeing some activity in this space where there has been almost none for some time.  So we could say that there are signs of life here and sales off the plan are staring to make a reappearance."

She said it was likely a good thing, particularly in Auckland.

"It sounds like Auckland needs some given the figures that are quoted about our looming housing shortage."

The law firm warned that changes in the law meant there were new things to watch for in the agreements.

It said that buyers should now expect disclosure documents and understand their limitations. "Once you have signed, you can't pull out if you don't like what's in it."

Marsden said buyers needed to be very clear about what they were signing. "They need to make sure what they see in the pretty pictures is what they are going to get in real life."

They should also find out what kind of timing was expected of the developer and under what circumstances a developer could bring the deal to an end.

Marsden said she had seen several developments selling off plans around Auckland, particularly on the city fringes.

But she said whether they went ahead would depend on whether the developers could get enough money. "It will be interesting to see where that money will come from, since there aren't any finance companies around any more."

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