Off-the-plan properties are off the menu for investors

Adam Smith 27 July 2017

house keys sale1Investors favour established properties over new off-the-plan builds, research has revealed.

The Mortgage Choice Investor Survey has found that 76.9% of respondents either had bought or intended to buy an existing property, versus 23.1% who favoured a new build.

The result is a slight rise on last year’s survey findings, when 75.8% of investors said that they intended to buy an existing property.

“While it's only a small rise each year, this is a trend that I expect to see continue over the coming years," Mortgage Choice chief executive John Flavell said. "I believe that we will continue to see an increasing proportion of investors choosing established dwellings over new builds.”

Flavell said that there were reasons why an investor might choose an established property over an off-the-plan build.

“Firstly, established dwellings are ready to buy and move tenants into straight away. Meanwhile, investors who purchase an off-the-plan property may have to wait several years before they can access the property and, in turn, generate income from potential tenants,” he said.

Flavell said that established homes could also be more affordable, depending on the location, and that investors also had the option of adding value through renovations.

“Lastly, we have seen a few examples where the valuation for an off-the-plan property has come back short, leaving borrowers scrambling to make up the difference. Investors are acutely aware of this and, as such, are looking at all their property options before heading down this path,” he said.

The findings come following an announcement in June that the NSW Government will axe stamp duty exemptions for off-the-plan properties.

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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
4.09%
4.11%
$0
$0 p.a.
80%
Pay no application fee on this low variable rate investment home loan.
3.74%
3.74%
$440
$0 p.a.
80%
An investment loan with a competitive interest rate, no ongoing fees and flexible repayment options.
4.09%
4.09%
$0
$0 p.a.
80%
Investors can take advantage of a discounted standard variable rate.
4.49%
4.52%
$0
$0 p.a.
80%
Access equity to further your investment opportunities.
3.99%
4.00%
$0
$0 p.a.
80%
A low-fee variable rate investor loan with a fast online application process.
4.87%
4.91%
$595
$0 p.a.
80%
Get a basic investment home loan with no ongoing fees.
3.89%
3.91%
$0
$0 p.a.
80%
Package your owner-occupied loan with your investment loan and enjoy low rates for both.
4.29%
4.32%
$600
$0 p.a.
90%
Borrow up to 90% LVR and pay no ongoing fees with this investment loan.
4.24%
5.32%
$0
$395 p.a.
95%
Lock in the interest rate on your investment purchase for 3 years and enjoy the benefits of a package home loan.
4.83%
4.88%
$445
$0 p.a.
80%
A competitive home loan for investors.
4.65%
4.69%
$600
$8 monthly ($96 p.a.)
90%
Save on a no-frills home loan that offers a competitive rate without the bells and whistles.
4.39%
5.34%
$499
$0 p.a.
95%
Enjoy a competitive 3-year fixed rate with no ongoing fees.
4.19%
5.37%
$0
$395 p.a.
95%
Plan ahead by locking in your rate for 3-years on this investor loan. $1,500 cash back available for refinancers. Conditions apply.
3.98%
5.58%
$600
$8 monthly ($96 p.a.)
95%
Get peace of mind by fixing your investment home loan rate for 2 years.
5.59%
$0
$395 p.a.
90%
Package your home equity loan to save on rates and fees.
5.79%
5.93%
$600
$8 monthly ($96 p.a.)
95%
A competitive rate to help you purchase your next investment property.
4.34%
5.53%
$600
$8 monthly ($96 p.a.)
95%
Get a competitive 3-year fixed rate to buy your next investment property.
4.44%
5.53%
$0
$395 p.a.
90%
Enjoy a 2-year fixed rate with no establishment fees or annual credit card fees, all for an annual package fee of $395.
5.20%
5.58%
$0
$395 p.a.
95%
Package your investment loan and pay no application fees.
4.23%
4.54%
$0
$299 p.a.
80%
A competitive package rate for loans above $150,000. Optional offset account.
4.79%
5.44%
$0
$395 p.a.
95%
Package your 4-year fixed rate investment loan and pay no application fees.
3.88%
5.42%
$0
$395 p.a.
95%
A competitive 2-year fixed rate to help you invest in property.
4.09%
4.25%
$300
$10 monthly ($120 p.a.)
90%
Get a competitive investment home loan rate without expensive features you may not need.
4.59%
5.37%
$0
$395 p.a.
95%
Enjoy the stability of an investment home loan rate locked in for 5 years.
4.29%
4.64%
$0
$299 p.a.
90%
A high LVR home loan able to be used for investment purchases.

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