Buying real estate through off-plan deals has become a common practice within the real estate community. Most developers offer it as an option for acquiring real estate. Is it the best method? That will depend on who you are speaking to and what you want to achieve. Like any other payment method, there are pros and cons that are relative to a buyer’s financial situation but one thing is for certain, buying off-plan is a great method for beginners and first-time buyers.
Here’s a summary of what buying off-plan is all about. When developers initiate a new construction project, they often face a significant financial challenge. Most don’t have the capital required to complete the project upfront. To bridge this financial gap, they employ a strategy where they sell properties before construction has even begun, a practice commonly known as “selling off-plan.”
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In the off-plan sales model, potential buyers are asked to commit to purchasing a property that is still in the planning or early construction stages. As part of this commitment, buyers are typically required to make an upfront deposit.
This deposit serves a crucial purpose in the development process. It provides the developer with immediate funds, allowing them to cover essential expenses like wages for construction workers and the procurement of necessary materials during the course of the project. This is especially crucial in the initial stages when significant capital is needed to kickstart construction.
Benefits of Buying Off-Plan Properties in Ghana
Some regard this model as too risky or too slow to make profits from. Is that really the case?
This article talks about 5 reasons to consider buying your next property off-plan. So, let’s take a closer look at why buying off-plan could be a smart move and if it’s the right option for you.
1. Cost Savings and Below Market Value
When you buy a property before it’s actually built in Ghana (that’s what we mean by off-plan), you often get a good deal. Your price is usually less than what the property will be worth when it’s finished.
Why?
Because developers want to attract buyers early on, so they offer lower prices to encourage people to commit to buying before the construction is complete. By getting in early and agreeing to buy at this lower price, you might end up saving money compared to waiting until the property is fully done.
This does come with some risk as there are stories of people who have made an off-plan down payment but construction has still not begun after 3 years of paying. This is why you should do your due diligence as a buyer and only work with trusted developers who have a track record of finishing their developments within the promised time.
2. Price Appreciation
Let’s say you’re interested in buying a new apartment in a developing area in Accra. A developer is launching a new project and offers you the chance to buy a unit off-plan.
The developer, eager to secure early commitments, offers you a discount price if you agree to buy before the building commences. You agree to purchase the apartment for $100,000 when the original price would be $120,000.
Over the next year, construction kicks off. The foundations are laid, and the building starts taking shape. As this happens, the developer releases updates, and you can see the progress. Meanwhile, the real estate market in Accra is thriving. More people are moving to the area, and property values are steadily rising.
As your off-plan property is part of this growing market, its value is increasing, not just because it’s becoming a finished apartment, but also because the demand for properties in the area is going up.
A few years later, the construction is complete, and the property is now valued at $200,000 in the current market. You decide to sell it. Congratulations, you’ve made a $100,000 profit because you bought early.
Get the picture?
By buying off-plan, you position yourself to ride this wave of market appreciation. The real payoff comes when you decide to sell or rent out your property. The real estate market in Ghana always appreciates at about 5-8% each year offering a very profitable ROI.
If the market has appreciated significantly since you made your off-plan purchase, you could make a tidy profit. Even if you don’t sell immediately, renting out the property becomes more lucrative as its value increases.
3. Flexible Payment Plans
When you’re considering buying an off-plan property in Ghana, developers often understand that not everyone has the full purchase amount upfront. That’s where flexible payment plans come into play.
Instead of requiring you to pay the entire cost of the property in one go, developers offer payment plans that allow you to spread the payments over different stages of the construction process.
For instance, you might make an initial deposit when you commit to buying the property. Subsequent payments could be tied to specific milestones in the construction, such as the completion of the foundation, the framing of the structure, or the finishing stages.
These part payments make it more manageable for buyers to handle the financial commitment. This flexibility can be particularly beneficial for those who might not have the full purchase amount available but still want to secure their property early in the development process. At Signum Development, the payment plans for our apartments are flexible as payment can be made in monthly, quarterly or semi-annual instalments.
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4. Customization Opportunities
Buying off-plan in Ghana gives you the chance to customize your home to align with your preferences. Think about it: during the early stages of development, developers typically allow buyers to make choices about certain aspects of the property’s design and finishings. This includes things like the internal layout, colour scheme, flooring materials, kitchen fittings, or bathroom tiles. Essentially, you have a say in how the final product will look and feel.
This customization opportunity is a significant advantage for those who want their home to reflect their preferences and style. You’re not stuck with predetermined features. Instead, you can shape your living space to suit your tastes and needs.
For example, if you prefer hardwood floors over tiles or you want a modern kitchen design, you can communicate these preferences to the developer. This flexibility ensures that the property you’re investing in feels uniquely yours from the moment it’s completed. These customizations normally come with an added cost but it’s worth it if you want your property to meet your needs and preferences.
5. Prime Location and High Demand
When you’re thinking about buying a property that’s not yet built in Ghana, one big advantage is where it’s going to be. Developers carefully pick locations for these future homes, choosing places that are already popular or expected to grow. These areas usually have things like good schools, transportation options, and essential services nearby—basically, they’re places people really want to live or invest in.
Why is this important? Well, in a popular area, it’s easier to find people who want to buy or rent your property once it’s ready. This is good for you because it means you might be able to sell or rent it out quickly and at a good price. The location becomes a selling point, attracting people who are interested in living or investing in a desirable neighbourhood.
Investing in a property in an area where many people want to live or where there’s ongoing development sets you up for potential future gains. As the neighbourhood develops, the property’s value is likely to go up, giving you the chance to make a profit in the long run.
Living in a great location not only makes it easier to sell or rent your property but also makes your own life better. Being close to important things like schools, hospitals, and transportation makes life more convenient. So, not only is the property a good investment, but it also makes your day-to-day life more comfortable.
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Signum Development: A Popular Off-Plan Developer in Ghana
If you’re considering venturing into off-plan property investments, it’s crucial to conduct thorough research and align yourself with trustworthy developers offering appealing payment plans. In Ghana, Signum Development stands out as the go-to choice.
As a Ghanaian company specializing in crafting homes, Signum Development has been transforming dreams into reality since 2016. Our expertise is evident in our extensive portfolio, boasting over 170 homes in Ghana, with expansions into key areas like Westlands, Labone Oyarifa, Tse Addo and Dansoman.
Our commitment to quality is unwavering. Signum homes are meticulously designed with a focus on craftsmanship, durability, and modern living standards, ensuring an elevated standard of living for our valued clients.
Signum Development presents off-plan properties in prime locations across Accra, Ghana. Seize the opportunity to reserve your dream apartment now and experience the myriad benefits outlined earlier. Ready to make your move?
Get in touch with us to learn more about off-plan properties and how you can get yours today!
15th December 2023
6:30pm
The Function Junction, Tse Addo
