Buying a new build or ‘off plan’ villa or apartment is an attractive option. A lot of people do like the fact that they will be the very first to live in it! Mostly this is a great and positive experience but there are potential pitfalls that investors and buyers should be aware of.
The Benefits of New Build Homes
New build homes are appealing to home buyers for a number of reasons:
- You will be the first to live in it
- Minimal or no repair costs for a good few years
- You will often have the chance to influence fixtures and fittings giving you exactly what you want
- New villas come with guarantees as stipulated by law in Turkey
- With many new villas owners will have the benefit of lower running costs and energy bills
Possible pitfalls with a new villa and top tips to avoid them!
When you are set to spend thousands or more, you should expect a great level of attention to detail and standards. It’s unfortunate if the quality of work and after sales leaves a buyer badly disappointed. Thus, select not just your villa but also the developer very carefully.
Here are our top tips:
- The right villa and the right developer. Make sure that you research who the developer is and carefully inspect all of his/her completed finished projects. Speak to current owners about any issues that they have encountered.
- Get talking. Ask to speak to past buyers and specifically ask about the process of buying – was it a smooth process and how happy are they with the finished product? Did the developer deliver on time and did heShe meet their expectations? A good estate agent should facilitate all of this and work in a very open and transparent way. Leave no stone unturned, and listen to your instincts. Continue your research on line, and check out forums from people who have used the developer’s services.
- Don’t rely solely on the developer’s brochure and marketing material. Try to get a real feel for the area – drive around, walk around and really try to picture yourself living your life on a day to day basis. Does what you are buying fit the area that it is in? Don’t forget to check out zoning laws, public land and what may or may not be allowed to be built nearby in the future, either privately or publicly.
The idea of buying ‘ off plan’ is that you are getting a bargain, and you are helping to bankroll the developer so if you are an early bird you get the advantage of a big discount. But the opposite can also be true. Similarly to buying a car the second you turn the key, your purchase can depreciate. You have lost the ‘new feeling’ and even in a positive and growing market, you can trip up if you pay a premium, so insist on your agent giving credible comparables to ensure that you are getting the bargain you have agreed to.
- Once you have negotiated the price, try to take advantage of ‘add-on’s’. Many developers offer incentives, furniture, white goods, a parking space or maybe get the stamp duty tax or a VAT included deal, but always select your own lawyer and have them draft the purchase agreement to your approval.
- Adding value. Think to the future. What is the scope to improve the property and keep its resale value? could you extend it, or add a swimming pool a garage etc? Think of ways you might add value to your investment to make it attractive to the next buyer if and when you move on.
Delays in Delivery
This is a natural concern – the developer misses the delivery date through delays so make sure the contract provides a penalty clause in your favor for any delay. Have any force majeure detailed, described and agreed to, especially forces of nature.
Workmanship and Finish
Guarantees and warranties will not be a cover for the craftsmanship and finishings so try to have an independent consultant to check on your behalf throughout the build if you are not going to be there in person, this could be your estate agent who could keep you regularly informed of how your investment is shaping up.
When your lawyer is drafting the sales contract, have as much information as you can bolted on to the agreement. Ensure an up to date site plan marking your chosen villa, floor plans with dimensions, and a very detailed technical specification describing the type, make and quality of materials to be used. The more detail you include the better. Do not rely on the developer’s brochure as it is not a legal technical specification.
Make sure upon completion, that the developer hands over to you all the guarantees, warranties and manuals for white goods, electronics, mechanical installations, alarms and any additional add-ons that have been included in the purchase contract.
Your lawyer should carry out good due diligence before you enter in to any agreement. Does the developer own the land? Maybe he has entered in to a ‘ joint venture’ with the landowner, as this is common practice in Turkey. If this is the case, your lawyer will need to bring the landowner in to the agreement and he/she should also make a copy of the details of the notarized joint venture deal available to check that it is compatible regarding delivery dates with the agreement you are about to enter in to. Also, your lawyer should check that the actual building permit has been granted and he/she should check that permission matches the project being undertaken.
Luxury Property Turkey’s Final Tip: Pay in stages according to a detailed schedule. For example, 20% at contract, 20% once foundations are done, 20% once the shell is done, 20% with windows and doors , 20% on delivery. Absolutely get the title deed in to your name as early as you can in that cycle before final payment.
By Darren Edwards