Difference Between Off the Plan and Completed Apartments in Chatswood

What Is an Off-the-Plan Apartment?

An off-the-plan apartment is a property purchased based on architectural plans, floor plans, and display suites, before the physical building is complete. Buyers typically pay a 10% deposit on exchange and settle when construction finishes, which may be 1 to 3 years later.

What Is a Completed Apartment?

A completed apartment is an existing, built property, either brand new and never occupied, or previously owned. You can physically inspect the apartment before committing to purchase, and settlement typically occurs within 6 weeks of exchange.

Key Differences: Off the Plan vs Completed Apartments in Chatswood

1. Price and Market Value Risk

Off-the-plan: You lock in today’s price for a property you will not receive for 12 to 36 months. In a rising market, this is a significant advantage because you build equity before paying the balance. In a falling market, your apartment may be worth less than you paid by settlement. Completed: You buy at today’s market price with full certainty about what you are paying for.

2. Ability to Inspect the Property

Off-the-plan: You cannot inspect the finished product before buying. You rely on display suites, floor plans, renders, and developer reputation. Completed: You can physically inspect the apartment, checking finishes, light, noise, views, storage, and common property, before committing.

3. Stamp Duty

Off-the-plan: In NSW, stamp duty is typically assessed on the land value component only at the time of contract. This can reduce stamp duty by $10,000 to $30,000 compared to buying the same apartment completed. Completed: Stamp duty is calculated on the full purchase price at the time of exchange.

4. Customisation Options

Off-the-plan: Buyers who purchase early often have the opportunity to select finishes, kitchen colour schemes, flooring materials, and appliance packages. Completed: What you see is what you get. No customisation is possible.

5. Settlement Timeline

Off-the-plan: 12 to 36 months from exchange to settlement. Your deposit is tied up during this period, but your mortgage does not begin until settlement. Completed: Settlement typically occurs 6 weeks after exchange.

6. Finance and Valuation Risk

Off-the-plan: Finance pre-approval must be renewed as the construction period extends. There is a risk that values fall below your purchase price. Completed: Finance is assessed on the property’s current market value, which is known at the time of purchase.

7. New vs Existing Condition

Off-the-plan: You receive a brand-new apartment with a 6-year structural defect warranty. Everything is brand new: appliances, fittings, and carpets. Completed existing: Older apartments may require renovation or carry ongoing maintenance costs.

8. Tax Benefits for Investors

Off-the-plan: New apartments attract strong depreciation benefits. Investors can claim depreciation on fixtures, fittings, and the building’s construction cost. For a new Chatswood apartment, this can generate $5,000 to $15,000 or more in tax deductions per year in the early years of ownership.

Summary: Which Is Right for You?

• Choose off-the-plan if you want stamp duty savings, a longer settlement timeline to save more, customisation options, and maximum depreciation benefits
• Choose a completed apartment if you need certainty, want to inspect before buying, need to move quickly, or are risk-averse about valuation changes