Buying an apartment for sale off of the plan is an investment strategy that will deeply divide property investment experts and commentators. Some are all for it, seeing buying off of the plan as an excellent way of obtaining a cheaper price on a quality property in the right circumstances. However, others will be much warier of the practice. At the end of the day, the person that is best placed to decide whether a particular investment is right or wrong for your needs, circumstances, and specific goals is yourself, with the assistance of advice from a suitably qualified professional. However, there are some factors that may be true in a general way for many off the plan apartment developments that may possibly be worth considering.
For instance, it is worth bearing in mind that the higher a high rise apartment development is, the greater the value of the apartment that will be contained in building value, which tends to depreciate, and the lower the proportion of the value of the apartment that will be composed of land value, which has historically tended to appreciate over the last few decades in Australia (not, of course, that past performance is necessarily an indicator of future results). While this may result in certain tax advantages, especially when the building is new, for many people it is often preferable to own off the plan in Wollongong that makes a return rather than deliberately engineering a loss to minimise tax payable. While this may not be the most terribly sophisticated investment advice, and bear in mind that you should always only ever make investment and financial decisions with reference to your own goals, needs, and circumstances, consider the following: should you, for whatever reason, lose your main source of income, a profitable positively geared investment will likely continue to supply an income stream of a certain size, whereas the tax advantages of a negatively geared loss making investment is likely to become irrelevant if you lose a large part of your income.
Of course, negative gearing versus positive gearing and the financial implications of each strategy is not a particularly unique consideration for investing in long term benefits investment property in Wollongong more generally, but it is something to keep in mind. In an investment property with a lower proportion of land value, it may make sense to expect more of the total return of the investment to come from rental income over the life of the investment, rather than from capital growth. Depending on what you are hoping to do with your investment property and over which time scale, this may be something that you wish to consider when you are buying an investment property. Also consider that property is not the only possible investment category and that it is poor diversification to overcommit to property as your sole or main investment.
