Why Off the Plan Purchases Are Different
When you buy an established home, you can inspect it, identify defects, and settle within weeks. Off the plan apartment purchases work differently. You're buying based on plans and specifications. The building might not be finished for one to three years. During that time, construction costs rise, developers face cash flow pressures, and market conditions shift.
These factors create specific buying off the plan risks that first home buyers often don't anticipate. The apartment you receive might look different from the display suite. The view could be blocked by a neighbouring development approved after you signed. The developer might try to terminate your contract if property values have increased significantly.
New Build Property Law Protections
Australian states have introduced various protections for off the plan buyers. Victorian legislation now prevents developers from unilaterally cancelling contracts via sunset clauses. Deposits must be held in trust accounts rather than released to fund construction. Defects liability periods give you time to identify faults after settlement.
However, these protections only help if your contract doesn't contain provisions that undermine them. Some developers draft contracts that maximise their flexibility while minimising yours. Broad plan variation clauses, limited disclosure obligations, and restrictive defect notification requirements can all work against you.
What Happens Between Contract and Settlement
The period between signing and settlement creates ongoing obligations and risks. Your finance approval will likely expire and need renewal. Interest rates might change. Your personal circumstances could shift. The developer might request extensions or notify you of plan changes.
We stay in contact throughout this period. When settlement approaches, we coordinate with your lender, review the developer's settlement requirements, and ensure you're prepared for completion. If issues arise during construction, we advise on your options and rights.
Stamp Duty Concessions for Off the Plan Purchases
Victorian off the plan duty concessions allow you to pay stamp duty only on the land value plus construction work completed at the contract date. Since you're buying before construction finishes, this often means significant savings compared to buying the same apartment after completion. Combined with first home buyer concessions, eligible purchasers can reduce their stamp duty bill substantially.
We calculate your expected duty liability and identify which concessions apply to your purchase. This helps you budget accurately for settlement costs that might be 12 months or more away.
Defects and Rectification Rights
New apartments commonly have minor defects at handover. Paint imperfections, scratched surfaces, doors that don't close properly. Your contract should include a defects liability period, typically 13 weeks to 6 months, during which the builder must rectify faults you identify.
We review your defect notification requirements and timeframes. Missing a deadline or failing to follow the correct process could leave you paying for repairs the builder should cover.
