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

Adam Smith 27 July 2017 NEWS

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
loans.com.au Package Special - 2 Year Fixed (Investor, IO)
3.89%
4.24%
$0
$0 p.a.
80%
Sharp interest only package rate
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UBank UHomeLoan Variable Rate -Discount Offer for Investor Variable P&I Rate
3.99%
3.99%
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$0 p.a.
80%
Special discounted interest rate
Get a discounted, low-fee investor loan from a convenient online lender. 20% deposit required.
ClickLoans The Online Investor Home Loan - LVR <70%
3.98%
3.98%
$0
$0 p.a.
70%
Requires a 30% deposit
Investors can get a 100% offset account and a low rate if they have a big deposit. 100% online application process.
Tic:Toc Invest Loan Variable Rate Home Loan - Principal & Interest
3.91%
3.92%
$0
$0 p.a.
80%
Add an offset account for $10 a month
Investors can go from application to approval in as little as 20 minutes with this innovative online lender.
loans.com.au Offset Variable - Package Offset (Investment, P&I)
3.97%
3.99%
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$0 p.a.
80%
Competitive investment package loan
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Greater Bank Ultimate Home Loan - 1 Year Fixed (Investor) P&I
4.09%
4.87%
$0
$395 p.a.
90%
10% deposit option available
Buy your investment property and set your repayments for the first year. Available in QLD, NSW and ACT only.
State Custodians Low Rate Home Loan with Offset - LVR up to 80% (Investor, P&I)
3.93%
3.94%
$0
$0 p.a.
80%
Competitive investor rate with plenty of features
This investment loan keeps fees low, has a sharp interest rate and comes with a 100% offset account.
Mortgage House Wealth Builder Investor Special 3 Year Fixed Rate Home Loan
3.99%
4.14%
$0
$0 p.a.
70%
Competitive investor mortgage for borrowers with a 30% deposit.
loans.com.au Essentials - Variable (Investor, IO)
4.29%
4.31%
$0
$0 p.a.
80%
Flexible, low fee mortgage
Investors will pay no application or ongoing fees for this interest-only loan.
ClickLoans The Online Investor Home Loan - LVR <80%
4.18%
4.18%
$0
$0 p.a.
80%
Competitive investment mortgage
Investors get a 100% offset account and pay no application or ongoing fees on this loan from an innovative online lender.
Macquarie Bank Basic Home Loan - LVR up to 70% (Investor, P&I)
3.99%
3.99%
$0
$0 p.a.
70%
Save on fees with this investor mortgage
Investors with a 30% deposit can get this low rate loan to fund their property portfolio.
loans.com.au Essentials - Variable (Investor, P&I)
4.29%
4.31%
$0
$0 p.a.
80%
Simple, flexible investment product
A simple, variable rate investor loan from an online lender that keeps fees to a minimum.
UBank UHomeLoan - 1 Year Fixed Rate (Investor, P&I)
3.99%
4.62%
$395
$0 p.a.
80%
Flexible fixed investment loan
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender.
Greater Bank Great Rate Home Loan - 1 Year Fixed (Investor) P&I
4.24%
4.68%
$0
$0 p.a.
90%
Investor loan with a small deposit option
Fix your investment repayments for 1 year. You can get this loan with a 10% deposit. Available in QLD, NSW and ACT only.
State Custodians Low Rate Home Loan with Offset - LVR 80% to 90% (Investor, P&I)
4.13%
4.14%
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$0 p.a.
90%
Available with a 10% deposit
Access a fee-free offset account and a special interest rate for investors.
Tic:Toc Invest Fixed Rate Home Loan - 2 Years Fixed (Interest Only)
4.14%
3.96%
$0
$0 p.a.
80%
Low fee investor mortgage
Investors can go from application to full approval in as little as 20 minutes with this innovative online lender.
State Custodians Low Rate LOC - LVR up to 80% (Investor, IO)
4.18%
4.19%
$0
$0 p.a.
80%
Line of credit for investors
Investors can easily access their equity using BPAY, a debit Master Card or cheque book with this interest-only line of credit.
Tic:Toc Investor Interest Only Variable Rate Home Loan
4.31%
3.95%
$0
$0 p.a.
80%
Rapid online application process
A variable interest-only loan for investors. Fast application, low fees, optional offset account. 100% online lender.
Mortgage House Advantage Variable Home Loan - LVR 80 Special (Investor, P&I)
4.14%
4.17%
$0
$0 p.a.
80%
Competitive rate for investors
Investors can enjoy flexible repayment options and pay no application or ongoing fees.
Tic:Toc Invest Fixed Rate Loan - 2 Years Fixed (Principal & Interest)
3.94%
3.92%
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$0 p.a.
80%
Add an offset account for $10 a month
Lock in your interest rate for 2 years and enjoy flexibility, an optional offset account and a fast online application process.
Aussie IQ Offset Fixed Home Loan - 3 Years Fixed Rate up to 70% LVR (Investor, P&I)
4.29%
4.27%
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70%
Lock in your investment rate for 3 years
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Tic:Toc Invest Fixed Rate Loan - 1 Year Fixed (Principal & Interest)
3.84%
3.91%
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80%
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Bluestone Crystal Blue Alt Doc Home Loan - Clear credit (Investor)
5.99%
6.43%
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$15 monthly ($180 p.a.)
85%
An alt doc mortgage that allows investors to fund an investment property purchase even without PAYG payslips.

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