For many of us, buying off the plans represents an opportunity to enter the housing market, and a buy a new product with all the latest building specification, making this a particularly popular option among first home buyers and investors.

Buying a ready-to-move-into home can be very attractive – with no repairs or renovations required for many years to come and ample time to arrange finances. However, like all purchasing decisions, there are both benefits and risks of buying off the plans. As a buyer, you must be fully aware of precisely what you are buying and any additional rules and considerations that may apply.

What are the risks?


When buying off the plans, you’re investing in your developer, and their ability to complete the build within the timeframe. If the deadline comes and goes, you could find yourself in the unfortunate position of not having a house to move into! A sunset clause is a favourable way to mitigate this risk and can give you options to reclaim your deposit and cancel the agreement if a developer fails to meet their obligations.

It is essential that you allow time for your property lawyer to check the agreement thoroughly; we recommend ensuring there is a purchaser solicitor’s approval clause. Often you can request that one be inserted to the sale and purchase agreement on signing.

A longer settlement period when buying off the plans allows you time to arrange finances, however, if the market falls you might face problems if you intend to sell the property particularly if the build took longer than expected.

Monetary risk

Banks can be apprehensive in providing loans when buying off the plans, which can significantly impact your financial circumstances. While a deposit is required up front to secure a property, you’ll have to prove you can finance the property from the outset. The long lead time presents the risk that interest rates and lending criteria could change, adding significant pressures.

Change in Circumstances

Development of a new property can take two to three years before completion – so you’ll need to be patient. However, life won’t be put on pause while you wait for your new building. Jobs and lifestyles change, relationships end and people’s priority shift. You’ll be responsible for ensuring you’re well prepared to deal with these variables and are realistic about the lead time and how it could affect your ability to move in when the day finally arrives.

Body Corporate costs and development restrictions

Where applicable, it is important to review the body corporate rules for development closely. These rules outline the obligations and restrictions on owners in the development and can impose various restrictions with regards to things like pets, noise, use of shared spaces etc. You need to know that these rules are neither unreasonably strict nor too vague.

Expectations – Sales Pitch vs Contractual Commitment

Plans are not the same as the glossy finishes of the advertising material. Artists impressions will paint an idealistic image of your new build; the trick is to look past the flashy show homes and glossy depictions to visualize a realistic outcome.

It is crucial to carefully inspect the plans and specifications attached to the agreement for sale and purchase and seek sound legal advice to ensure they are sufficiently detailed, outline a timeline for completion, materials to be used and meet your reasonable expectations. Plans will include intricate legal clauses and the actual rendering of the building; we suggest you look over this with an expert.

You’ll want to find out exactly what changes you can make to the plans if any, and what the likely costs will be, for example, changing water pressure in the bathroom, extending the wardrobe in the guest bedroom, or adding additional power points in the living areas. These are important for the quality of your property but could significantly increase your costs if not discussed ahead of signing your agreement. 

Also, some contracts are designed to allow the buyer to choose their floor plan; while some enable developers to go unchecked with their changes to the layout.

In most cases, your sale and purchase agreement will include an “entire agreement clause” which will disregard all previously indicated plans for the development. This means you could end up with a significantly different home than the one illustrated in the original brochure. The best way to ensure your expectations are met is by managing them throughout the process with sound advice and a clear understanding of the contractual commitments of all involved parties.

Seeking quality legal advice should be high on your to-do list. If you don’t go through the details of the development purchase plans and the sale and purchase agreement very carefully before signing, you may be in for an unpleasant surprise further down the track. Your lawyer can advise you at each stage to ensure your interests are well looked after, and your expectations are well managed.


The risk of further complications, defects and other unforeseen circumstances can occur with all property transactions and developments. The best way to mitigate this is to get early advice from a property expert to make sure your agreement is as watertight as possible. You’ll want to discuss all possible pitfalls in detail with your lawyer; these can include:

  • defects; big and small,
  • unforeseen outcomes; disputes with neighbours or contractors, and
  • insurance risk.

Get the right advice from an industry expert

When buying off the plans, you’re backing the developer and his contractors to complete the project, and to meet the expectations set. So, it’s prudent to do your research and undertake thorough due diligence.

While this article gives you an overview of risks and factors to consider when looking to buy off the plans, you must get specific and expert legal advice to protect yourself and your investment.

For advice tailored to your property or investment goals, get in touch with JB Morrison’s specialist property law team.

Buying off the plans | JB Morrison Lawyers