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The discount property investment is referred to as a plot at this stage as it is not assigned a postal address until the building is finished. Many property developers and builders need to sell a proportion of a development off plan in order to secure the finance for the build. They therefore tend to sell at a discount off the market value at this stage to encourage investors to purchase. The investor can then enjoy any capital growth before the discount property investment is completed having only tied up a small percentage of the purchase price - typically 5-10% on exchange of contracts. Although there is a degree of risk and uncertainty house price inflation has been fairly consistent in the UK over the last 70 years with prices doubling approximately every 10 years since the 1930's. The advantages
The risks
Offplan Investor sources property as early as possible from developers to maximise the discounts for investors. Early releases in popular developments are often cheaper than later releases and if contracts are assignable there is the opportunity of "flipping" before completion. This means selling on your offplan property prior to completion for a higher price than you have agreed to pay. Before buying
Price - check current prices for similar properties. How to buy a property investment off plan
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