Property Investment Articles
Is buying units off the plan a good strategy?
I hate using the terms right and wrong when it comes to investing. I believe there is only opportunity cost and preference. Buying off the plan can seem like an easy, low stress way to accumulate investments, but in the current market with it’s uncertainties, buying off the plan units is definitely a higher risk strategy.
In today’s short video I just want to weigh in on the debate about whether it’s a good idea to buy units of the plan.
I’m often asked by people my opinion on the concept of buying units of the plan and certainly for a lot of people that have been a very lucrative strategy over the last 10- 20 years where you purchase a property today or exchange on a property today but you don’t actually settle or fully purchase that property for another 2-3 years.
Now in today’s market where there’s a lot of unnatural intervention going on from the government and in a lot of uncertainty in some sectors of the market, I would actually suggest that purchasing any cutting unit off the plan is actually a higher risk strategy particularly because all it takes is one nervous investor to come in and sell at a discount to really set the market for the rest of the units.
Now obviously there are some exceptions to this if you’re buying in a very small boutique type (kind) of series of units were maybe a bit close to completion or there’s some opportunity for you to participate in a development when you’re actually getting an upfront discount on that price.
The risk that a lot of investors are really toying with this current environment is that they’re buying or committing to placing down deposits on units which are maybe 12 to 24 months down the track, may or may not value up against the original price. Obviously that there are some exceptions to this and there are always great opportunities in that market and I’m certainly not here to say it’s a right or wrong strategy, where I am saying is that you need to be aware of that risk that market may move against you given the timeline that you’ve got to.
The shorter the time line in terms of from when you put you to fold it down to when the property is complete I feel the lower the risk although obviously you know you need to take into consideration what’s going on in that market and whether they’re likely to be a price increase hope you found that useful if there are any comments please share them with me below and as always send me any ideas that you’ve got for video blocks in the coming weeks.
Salena Kulkarni from Phoenix Wealth Group, signing off.
P.S. – Whenever you’re ready, here are 4 ways I can help you grow your wealth.
1. Fast Track - If you are ready to accelerate your investing results and get help with a personalised plan, then find a time in my calendar and let's get you started. Book Now.
2. Nearly Ready - Jump onto our next webinar and go deeper into some new frameworks that open up the world of alternative property investing and understand how to amplify your investing results. Register Here.
3. Not quite ready - Jump into our private Facebook group and become part of our community of investors who want information and insights into how to fast-track their property investing. Join Us.
4. Want more info - Grab part of my amazon best-selling book 'The Freedom Warrior'. It's the roadmap to getting accelerated results with your investing in the shortest possible time. Grab A Copy.
The biggest challenge that I see with business owners is apathy. They don’t care enough, and they are not fierce enough. One of the things in my relationship with money is interesting. Because in some ways I’m not particularly attached, I see it as a fantastic tool to...read more
And this is what I’m saying, that this stuff, It’s taking me a lifetime to figure this one out, there’s no one teaching it. No one in Australia I know that got across this stuff, it’s about the network that you build and have an interest in it. Time, energy,...read more
So here’s the challenge right now in Australia. The market feels wobbly assets are standing still and the runway, feels like it’s getting shorter. And what we are all worried about is that we are going to fall short on our expectations. None of us wants to get to a...read more
People said to me, are you all about US property, and then I said no, I have huge portfolio here that I love but right now what you want to be able to learn if you want to step up to be a more sophisticated investor how to zig and zag. If everyone else right now is...read more
(+61) 2 6100 3688
7 MacPherson St O'Connor ACT 2602 Australia
PO Box 6049 O'Connor ACT 2602
Monday - Friday 9:00 AM - 5:00 PM
GET IN TOUCH