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The pros and cons of buying established vs off plan for your first home

July 14, 2022

Buying your first home is an exciting and momentous time, but it can also be extremely nerve-racking.

There is a long list of questions that any potential new homeowner will, or should, ask.

How are you going to save up a deposit? Where should you live? How do auctions work? If you put your hand up to scratch your nose, will you end up accidentally buying a six-bed mansion?

You can find the answers to some of these questions in our buying insights, but for now let’s look at whether you are you better off buying off-plan, or looking for an established home.

What is an off plan property?

Buying ‘off-plan’ means buying a property that is still under construction or about to start — a build that hasn’t been completed yet. A developer will then work with a real estate agent to sell the individual homes (units) within the development.

Since they haven’t been completed yet, the buyers are shown plans for what they will look like. This usually includes:

  • Renders (artist impressions)
  • Plans
  • 3D models of the exterior building
  • Display suites
  • Site tours
  • Showcasing the development

Sales can start as soon as the developer is ready to launch the project and continue until all the units are sold. Sometimes the last units aren’t sold until after the build is complete. The earlier in the process you buy, the greater your choice of units. If you’re interested in a corner unit or a one on the side with the best views, you’ll need to get in quickly.

Independent Licenced Agent and Principal - Mark Wolens recommends keeping up to date with upcoming developments in areas you’re interested in.

“Developers want to get as many pre-sales as possible,” he says.

“To entice buyers, they can offer a few of the best units at an ‘early bird’ rate.

“If you know about a new development before it’s offered for sale, you can secure something very desirable.”

Licenced Agent and Principal - Mark Wolens

What are the pros and cons of buying off plan vs established?

Buying your first home is a practical decision but it’s also the place you’ll be calling home for some time, so it pays to consult your heart too.

Whether you decide to buy something established or an off-plan home will depend on your budget, current and future goals, taste, preferred location, future goals and current budget.


There’s no getting around it, purchasing a property will almost certainly be the largest amount of money you have ever spent on something. But it’s a reliable and practical investment, especially if you take a measured approach, and there are government incentives in place to help ease the burden.

You’ll need a minimum of 5 per cent of the total purchase price as a deposit. Usually if you have less than 20 per cent of the purchase price as your deposit you would need to pay Lenders Mortgage Insurance (LMI).

However, under the First Home Guarantee scheme, the government is waiving that fee if you have just a 5 per cent deposit. Previously named the Loan Deposit Scheme (FHLDS), it was introduced in 2020 and in the 2022 Federal Budget the government increased the number of places available from 10,000 to 35,000 per year.

You will also need to factor in the cost of a solicitor or conveyancer and potentially stamp duty.

Wayne says it is worthwhile looking at the current government incentives, such as Canberra’s existing stamp duty concession for off plan properties up to $600,000.

What help do first home buyers get?

The requirements and limitations evolve over time, but there are always some grants and concessions out there for first home buyers. Some are only available if you’re building a new home, others aim to ensure parents can provide a family home.

Check whether you’re entitled to any of the following:

  • Local Government Incentives
  • Stamp Duty Concession Scheme
  • First Homeowner Grant
  • Family Home Guarantee Scheme


One benefit of buying off-plan is that you often aren’t required come up with all of this money at the start. Many developers will accept a lower deposit to secure your new home (the contract deposit) and the rest of the proceeds at settlement. The initial deposit can be as low as $1,000 and is rarely more than 5 per cent.

Since an off-plan build can take two years or more, you can leverage the opportunity to buy now and save the rest of the deposit while it’s being built. Since you lock in the purchase price when you put down that deposit, you could enjoy some capital growth in the meantime.

“Canberra has been a steady growth market for several years,” Wayne says.

The ability to ‘secure’ a property at today’s prices and come up with the money later is really helpful, especially for first home buyers.”

James has been wanting to buy his first home for five years, but it’s always been just out of reach. As soon as he manages to scrape up a 5 per cent deposit, prices go up again and he falls short. He decides to explore off-plan options instead.

James signs a contract for a two-bedroom apartment at $400,000, with the final build expected two years later. He has $25,000 saved, which covers his 5 per cent deposit ($20,000) with a little left over. If he was buying an established property, he would need to take out a loan for the other 95 per cent ($380,000) now.

Because he is buying for under $600,000 he is eligible for the First Home Guarantee scheme, which the government increased in 2022. This means Lenders Mortgage Insurance (LMI), which usually applies when a buyer has less than 20 per cent of the purchase price for a deposit, could be waived.

He also qualifies for the Stamp Duty Concession, which applies only to off-plan purchases after 1 July 2022.

Because he’s bought off-plan, he also has another two years to save. In that time, James has saved another $35,000. His total deposit is now $60,000.

At the same time the apartment has gone up in value and is now worth $420,000. James needs to borrow $340,000. He has a $60,000 deposit and $20,000 in equity, or $80,000 altogether. This gives him a Loan to Value ratio (LTV) of 80 per cent. He is able to avoid the extra fees and can also access a lower interest rate. James is on his way!


This is the other big consideration when deciding what type of property to buy. If you can’t stand to look at your housemate’s dirty dishes in the sink for one more week, you probably want an established home you can move into soon. An off-plan build, especially if you’ve gotten in early, can take up to two years to be ready, sometimes even longer.

While developers will give you their best guarantees as to build time, sometimes delays happen that are out of their control. Government approvals can get held up and unforeseen weather can bog everything down – literally!

Established homes are ready and waiting to move into. A standard settlement period is about four weeks from when you sign the contract. Do bear in mind, that the process of finding the right home can take a lot longer for established builds.

You’re looking at spending a lot of time at open homes and auctions, getting building inspections done and hoping your offer won’t be beaten by someone else. Deciding where you want to spend your time, on house hunting for an unknown period or waiting for something to be built, is an important consideration.


For those who want a completely unique home, established is usually the answer. Individually built homes all have their own quirks and features, which can appeal to those who don’t want to look just like their neighbours. However, the amount of control you can have over a new build is often overlooked.

Most developers offer the opportunity to customise your unit before it’s built. You can pick from different colour schemes, choose finishes for your kitchen and bathroom and select flooring and blinds. There is even opportunity with some new builds to make changes to the floor plan.

If you’re early enough, you can also choose your unit from a range of options. Choose one that overlooks the river, or gets the morning sun, or has an extra-large balcony — whatever is most important to you. You may also have the opportunity to make the most of upgrades on offer.


Does spending a weekend trying to match the exact shade of heritage paint to refresh your faded exterior sound like fun? For some people, the opportunity to renovate is half the charm of home ownership. If you’re a keen gardener, you’re probably attracted to established builds with your own outdoor space. Even the most overgrown yard offers potential to flex the green thumb.

If you’re time-poor (or even just money-poor), an off-plan property can mean serious ongoing savings. Since the furnishings and appliances are brand new, they’re all under warrantee and unlikely to need repair any time soon. The common property, including gardens and other outdoor areas, are taken care of via your strata fees.

Buying your first home is one of the biggest decisions you’ll ever make. If you’re not sure which way to go, why not chat to one of our experienced buyers consultants? We’ll be happy to show you some of our new off-plan developments and established properties for sale so you can make the best choice for you.


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