The Truth About Buying Off-the-Plan Property in Australia (June 2025): Smart Move or Silent Risk?
If you’re considering buying an off-the-plan property in Australia right now, let’s be blunt — it’s one of the riskiest ways to get into the market. While glossy brochures and showroom kitchens promise the dream, the reality is often riddled with delays, defects, and financial surprises buyers never see coming.
As a buyers agent who’s spent years navigating this space, I’ve done the heavy lifting for you. Based on the latest 2025 market data, here’s what every smart investor, first-home buyer, and downsizer needs to know before signing anything.
What Is an Off-the-Plan Property?
In short: it’s buying a property before it's built. You agree to a contract based on architectural drawings, floor plans, and a developer’s promise of what’s to come — usually with settlement 12-36 months later, once construction’s done.
It can work brilliantly in the right circumstances. But more often than not, off-the-plan buyers are entering a deal where most of the risks are stacked against them.

Why It’s Popular: The Headline Benefits
Let’s start with why off-the-plan still draws a crowd:
- Stamp Duty Concessions:
- In states like Victoria, you can save around $25,000 to $28,000 on a $600,000 apartment. Why? Because duties are calculated on the land value and construction to date, not the final price.
- Extended Settlement Period:
- Most off-the-plan deals require a 10% deposit upfront, then nothing more for 1-3 years, giving you time to save, sell other assets, or organise finance.
- Tax Depreciation Benefits:
- New builds mean bigger tax deductions. Investors can claim depreciation on fixtures and fittings from day one, improving cash flow
- Capital Growth Potential:
- In a rising market, you lock in today’s price. If the market surges while your property’s being built, you could bank capital gains before you even get the keys.
- Modern, Energy-Efficient Design:
- New developments usually offer better layouts, eco-friendly appliances, and compliance with current building codes, making them attractive for tenants and owner-occupiers alike.
The Hidden Dangers: What Developers Won’t Tell You
- Building Defects Are Rife:
- More than 50% of apartments built in NSW from 2016–2022 had serious defects. From water leaks to structural cracks, these issues often surface years later, just in time for strata fees to soar and your resale value to tank.
- The Cladding Crisis:
- Many buildings are still dealing with combustible cladding issues. Rectification costs can top $100,000 per unit, with lenders blacklisting affected buildings.
- Valuation Shortfalls:
- In some Sydney projects, 84% of valuations came in lower than the contract price upon settlement. If your bank values your $700k purchase at $630k, you’ll need to stump up the $70k difference or forfeit your deposit.
- Finance Can Fall Apart:
- 20% of off-the-plan contracts in NSW fail to settle due to tightened lending criteria. Banks reassess your borrowing power at settlement, and you might no longer qualify.
- Delays and Sunset Clause Shenanigans:
- Around 15% of projects are delayed by 12+ months. And while NSW tightened laws to curb developers abusing sunset clauses, delays still mean financial stress, lost rental income, and changing lending conditions.
- Display Suites Are Illusions:
- That glossy showroom apartment? Don’t get attached. Developers frequently swap out fittings for cheaper alternatives unless your contract locks everything in.

Real-World Example: How it Unravels
A Melbourne buyer paid $600k for an off-the-plan unit in 2020. It was meant to settle in mid-2022. COVID delays pushed completion to 2024.
- Final valuation: $540k
- Loan shortfall: $60k out of pocket
- Strata fees: Blew out by 70% due to waterproofing issues
- Rental estimate: 10% below what was promised
Lesson: Even with airtight planning, off-the-plan buyers are at the mercy of markets, banks, developers, and weather.
2025 Market Snapshot: Off-the-Plan Property in Context
- National dwelling values rose 0.5% in May
- Annual growth slowed to 3.3% — the lowest since 2023
- Australia remains 262,000 homes short, driving prices, but with fewer projects finishing due to cost blowouts and builder insolvencies.
Industry insiders warn of a fresh wave of defects as developers rush to complete amid high costs and stretched materials.

Who Should Consider Off-the-Plan in 2025?
- High-income investors chasing depreciation benefits and negative gearing opportunities
- Downsizers with solid equity, looking for low-maintenance lock-up-and-leave living.
- First-home buyers with parental financial support (because 77% of agents report this is now standard).
- Buyers targeting genuine growth areas like SE Queensland or Perth, where rental demand and infrastructure investment justify new supply.
Who Should Avoid It
- Budget-stretched buyers without contingency funds for valuation gaps, delayed settlements, or higher interest rates.
- First-time investors who underestimate the risks and complexity of property markets.
- Buyers relying on firm timelines for settlement due to life plans, finance conditions, or rental needs.
- Speculators banking on capital growth alone to make the deal work.

How to Reduce Risk If You Buy Off-the-Plan
- Vet the Developer:
- Check their track record. Have they delivered quality projects on time? Legal disputes? Defects? Insolvencies?
- Scrutinise the Contract:
- Hire a property lawyer, not just a conveyancer. Watch for:
- Sunset clauses
- Inclusions and materials lists
- Defect warranty terms
- Cladding risks
- Hire a property lawyer, not just a conveyancer. Watch for:
- Secure Finance Early:
- Get pre-approval now, and revisit it every 6 months.
- Prepare for Valuation Shortfalls:
- Have at least 10-20% of the purchase price in liquid funds to bridge gaps if valuations fall.
- Independent Inspection at Settlement:
- Don’t trust the developer’s inspection. Book your own independent building inspector before settlement.
Professional Verdict: Is Off-the-Plan Worth It in 2025?
In most cases? No.
The numbers don’t stack up for average buyers. Between construction risks, defects, valuation shortfalls, tight lending, and developer uncertainty, the downsides outweigh the tax perks and savings.
In today’s market, established homes and 5–10 year-old defect-free apartments offer better risk-adjusted returns.
If you’re determined to play the off-the-plan game, stick to top-tier developers with in-house construction teams, bulletproof engineering records, and fixed-price contracts with clear inclusions.

Final Word
Off-the-plan property is one of the most misunderstood — and oversold — strategies in Australian real estate. The tax perks and stamp duty concessions are real. But so are the financial landmines.
As a buyer's agent, my job is to call it how it is. And in 2025, I’m steering 80% of my clients away from off-the-plan unless the opportunity is truly exceptional.
If you’re serious about building wealth safely through property, let’s talk strategy. I’ll show you where the real opportunities are hiding.
👉 Book a free strategy session. No sugar-coating. Just facts.