Advice for early bird new home buyers: Part 3
Buying an off-plan project can be a scary concept for prospective home buyers, but it can be advantageous in terms of value for money, premium locations of property, lucrative promotions and investment returns. Realestate.com.kh discussed these factors in Part 1 and Part 2. This week we will explore why legal advice is necessary to ensure any prospective purchaser feels fully informed and secure about buying off-plan. Here is another major factor to consider before making a decision to purchase any off plan unit, thanks to Realestate.com.kh:
Why you should get a lawyer:
Off-plan properties are more complicated than post construction real estate deals. They involve more risk and more variables to consider as there is no physically completed project to secure your expectations. Especially if you are a foreigner, there can be many complicated laws and details that impact the sale and that you are unaware of.
To give a starting example, many countries have a “cooling-off period” available after the off-plan contract is signed. This basically means you have the legal right to change your mind after signing the contract and back out of the deal, without major detriment to you. The length of time you have to utilise this can differ, as can the costs associated. However, in order for you to know what rights are available to you in regards to this, sound legal advice is necessary.
Other examples of the importance of legal advice are the scenarios where the development may not actually be completed, or perhaps the finished unit may differ from the plans. This may be without intention – due to human error or a defect that the developer was unaware of at the time of signing.
However, in other situations this may be the developer’s intentions, and you need to be aware of what changes developers are legally allowed to make in regards to the initial contract. Regardless of the exact situation, if there is a change in what your contract specifies, a lawyer will enable you to protect yourself as much as possible.
Talking to a lawyer about what is typical and customary in Cambodia can also help you understand the scope of what to expect. Relatively new offerings from developers that are gaining traction, such as Guaranteed Rental Returns, may seem attractive at signing, but they are not well understood, and may be unreliable.
Legal advice will ensure that you are maximising value and minimising risk to yourself, so you can reap the benefits from your off-plan investment.
In summary, over the last three weeks we have looked at the benefits, implications and procedures relating to purchasing off-plan property. It can be a confusing and scary concept, putting forward your money without certainty of the outcome and the exact details of what you are purchasing.
However, so long as you do your research into the developer and development, look at the real estate climate as a whole and obtain legal advice so you are fully informed and protected, you can enjoy the advantages of a very rewarding area of investment.
James Whitehead is Director of Content @Realestate.com.kh