Is Buying Off-The-Plan A Good Idea?

The Australian property market has always rewarded those who understand it deeply — and right now, the signals are clear. Prices are rising, demand is strong, and the opportunity to build lasting wealth through property is very much alive. Here’s what you need to know heading into 2026.

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The Market Is Moving — Here’s Why

Let’s be direct: Australia’s housing market is not slowing down. KPMG’s January 2026 outlook forecasts national house values rising 7.7% and unit values 7.1% this year. These aren’t aspirational numbers — they’re grounded in the fundamentals of strong demand, tight supply, and a rental market under serious pressure.

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What’s driving this? A combination of underbuilding, sustained population growth, and policies like the expanded First Home Guarantee (5% deposit) keeping buyer demand elevated. New supply is improving, but it’s still running around 30% below the National Housing Accord target. That gap doesn’t close overnight — and until it does, upward pressure on prices persists.

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The rental market tells the same story: vacancy rates sit near record lows at around 1.6%, with rental growth running at approximately 5.9% annually. For anyone weighing up renting versus buying — the maths is increasingly tilting toward ownership.

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Key Numbers for 2026

• National growth: Houses forecast +7.7%, Units +7.1% (KPMG). NAB reports combined capital prices rose 8.2% in 2025.
• Loan demand: Home loan commitments were up around 13% (year to September 2025), led by investors.
• Rental market: Approx. 5.9% annualised rental growth with vacancy near record lows at ~1.6%.
• Building approvals: Apartment approvals have surged, though overall supply remains below population trends.

City-by-City: Where the Opportunities Are

Not all markets are created equal — and knowing the difference is what separates smart property decisions from reactive ones. Here’s where we see the strongest momentum:

• Brisbane — A market on the rise. Forecast +10.9% for houses, with entry-level prices that have roughly doubled since 2020. Brisbane’s affordability window is narrowing fast — the time to act is now, not later.
• Melbourne — Steady fundamentals. Forecast +6.8% for houses, underpinned by population growth and constrained supply.
• Sydney — Premium market, premium challenges. Growth moderates to around +5.8%, but absolute prices remain the nation’s highest.

The Affordability Reality — And Why It Shouldn’t Stop You

We won’t pretend the affordability challenge isn’t real — it is. Domain’s First Home Buyer Report 2026 shows entry-level house prices have risen 68% nationally since 2020, against wage growth of around 22%. That gap is significant, and it’s something every prospective buyer deserves to understand clearly.

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But here’s the perspective shift worth holding onto: waiting has consistently cost Australian buyers more than acting. The buyers who entered the market five years ago — even those who stretched their budget — have, in most cities, seen extraordinary capital growth. The buyers who hesitated are now facing higher prices and higher repayments.

The pathway hasn’t closed — but it does require a smarter approach. That’s exactly where the right guidance makes all the difference.

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Apartments: A Genuine Opportunity

For many buyers, apartments represent the most realistic and strategically sound entry point into the market right now. The national median unit price sits at approximately $610,000, compared to $903,000 for houses. That’s a meaningful difference, and one that opens doors.

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We’re also seeing a genuine shift in the supply pipeline. Apartment approvals jumped approximately 50% year-on-year (versus just 1% for houses), with mid-rise ‘missing middle’ developments leading the charge. The apartment share of new approvals has hit 25.1%— the highest since 2020.

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What this means for buyers: more choice is coming, but supply is still catching up. Apartment commencements remain around 44% below the levels of a decade ago even as population has grown 17%. Scarcity continues to underpin values.

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City apartment medians give a sense of the range: Sydney ~$810,000, Brisbane ~$706,000, Melbourne ~$608,000. In every market, units remain significantly below their house counterparts —and modern apartments increasingly offer the lifestyle, amenity and low-maintenance living that buyers genuinely want.

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How to Move Forward — With Confidence

Every property journey is personal. But there are some clear principles that serve buyers well in this market:

• Start with apartments. The price gap between units and houses is your friend. Focus on well located projects in urban infill areas and transit corridors where demand is durable.
• Think beyond the short term. If you plan to hold aproperty for five or more years, the maths of owning versus renting increasingly favours ownership — especially with rents rising at around 6% annually and vacancy rates near record lows.
• Know your city. Brisbane still offers entry points with strong growth runways. Sydney demands a longer-term view and strong household income. Each market has its own logic —and your strategy should reflect that.
• Do your homework on developers and timelines. A strong approval pipeline is promising, but projects still face cost pressures and skill shortages that can delay completion. Research matters.
• Get the right advice around you.

The Bottom Line

Australia’s property market isn’t waiting. Prices are rising, supply is constrained, and the buyers who move with clarity and conviction — backed by sound strategy — are the ones who build real wealth over time.

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Affordability is a genuine challenge, and we’d never minimise that. But the answer isn’t to wait on the sidelines — it’s to be better informed, better prepared, and better advised than everyone else in the room.

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That’s what we’re here for.

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_{Sources: KPMG Residential Property Market Outlook (January2026); NAB Housing Monitor January 2026; Domain First Home Buyers Report 2026;PropTrack/realestate.com.au analysis; Knight Frank Horizon Report 2026.}

Buying an off-the-plan apartment in Melbourne involves signing a contract before construction is complete, with settlement occurring once the building is finished. This approach allows buyers to secure a property at today’s prices, often with modern designs and facilities, before the project is built.

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This guide outlines the step-by-step process, realistic timelines, and financial considerations for both investors and owner-occupiers in Melbourne, providing a clear roadmap for navigating off-the-plan purchases.

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Step 1: Selecting an Apartment and Signing a Contract

The first step is choosing an apartment and signing the off-the-plan contract. At this stage:

• Deposit: Typically 10% of the purchase price.
• Finance Pre-Approval: Not essential at this stage, but speaking to your bank can help you understand your current borrowing capacity and any potential implications for your income or expenses.

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Example: For a $600,000 apartment, the deposit would be approximately $60,000.

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When signing the contract, it’s important to note key clauses such as the sunset date and any developer cancellation rights. Contracts are often weighted in favour of the developer, but these terms can be negotiated, either independently or with the assistance of a real estate agent.

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Step 2: Deposit Payment

After signing the contract, the deposit is usually transferred to a trust account held by the developer’s conveyancer. Alternatively, a deposit bond can be used, which may allow you to retain the interest earned or offset your other debts. However, this can involve fees and not all developers will accept it, so it’s worth weighing the cost against the potential upside.

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Other important considerations at this stage include:

• Cooling-off period: Victoria allows a 3-business-day cooling-off period after signing (unless waived or an exception applies). If you withdraw during that time, you can cancel the contract with minimal penalty.
• Legal review: Ensure your conveyancer checks for key clauses and potential risks before finalising payment.

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Step 3: During Construction

Construction of off-the-plan apartments in Melbourne typically takes 18–36 months, but realistic delays of 6–12 months are common.

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During this period, it’s important to stay informed about the progress of the development and any potential changes to completion dates, as settlement can only occur once construction is complete.

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Step 4: Finalising Finance

Around 60-90 days before settlement, your mortgage should be finalised with your bank or lending institution. At this stage, the bank will conduct a property valuation, which may affect your loan if the market value has increased or decreased since signing the contract. Factors influencing valuation include:

• Overall market movements
• Suburb-specific price changes
• The condition of the completed property
• Nearby developments that may impact resale value

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Stamp duty considerations: Buyers may be eligible for off-the-plan stamp duty concessions, particularly first-home buyers or certain investor categories. You can read more on our blog here.

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Step 5: Pre-Settlement and Handover

As settlement approaches:

• Conduct final inspections to ensure the property meets contract specifications and compliance requirements.
• Adjustments are made for rates, water, and body corporate fees.
• On settlement day, full payment is made, the title is transferred, and the keys are handed over.

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Practical Summary

Buying off-the-plan in Melbourne involves:

1. Selecting an apartment and signing a contract
2. Paying a deposit and reviewing contract clauses
3. Monitoring construction and allowing for potential delays
4. Finalising finance and considering stamp duty concessions
5. Completing pre-settlement inspections and taking possession

Timeline: Typically 18–36 months, with potential delays of 6–12 months.

Financial takeaway: Budget for deposit, stamp duty, conveyancing, and loan fees.

Purchasing an Australian property from overseas can feel daunting, especially if it's your first time. For international buyers considering off-the-plan apartments, understanding the finance process is crucial to avoid surprises and ensure a smooth purchase. This guide breaks down the steps in a clear, professional and practical way.

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1. Understand Your Funding Options

Before approaching a lender, it's important to understand how you will fund your purchase. Most overseas buyers combine equity or refinancing from their home country with some cash, sometimes complemented by a smaller Australian loan.

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Key considerations:

• Assess how much you can transfer internationally and any currency exchange implications.
• Plan for a contingency fund to cover unexpected costs, including settlement shortfalls or rate changes.
• Establish your budget realistically, taking into account deposits, fees and ongoing property costs.

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2. Engage a Broker Specialising in Foreign Buyers

Navigating Australian lending requirements can be complex for overseas purchasers. A mortgage broker specialising in international buyers is invaluable.

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How a broker helps:‍

• Identifies lenders who accept international applicants.
• Assists with document preparation and submission.
• Advises on currency considerations and repayment structures.

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Working with an experienced broker ensures your application is processed efficiently and reduces the risk of delays.

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3. Get Pre-Approval (Best Practice)

Whilst many buyers only approach a lender after paying the deposit, the best practice is to obtain pre-approval first.

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Why pre-approval helps:

• Sets realistic borrowing limits, so you know exactly what you can afford.
• Reduces the risk of financing surprises later.
• Gives you confidence when negotiating or signing the contract.
• Pre-approval is not always mandatory, but for first-time international buyers, it provides clarity and peace of mind.

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4. Prepare Required Documents

Once settelement draws closer, lenders will require comprehensive documentation to process your loan. Typical documents include:

• Proof of income and overseas assets
• Identification (passport, visas)
• Property contract details
• Evidence of deposit or cash funds

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Tip: Keep in mind currency exchange timing, as it can affect the exact amounts available for deposit or settlement.

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5. Submit Your Loan Application

Once your documents are ready, your broker will submit the application. During this stage, lenders typically check:

• Loan-to-Value Ratio (LVR) and foreign buyer lending limits
• Property valuation
• Your financial position and overseas assets

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Approval times can vary, so allow sufficient lead time, especially if you are aligning with property settelement.

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6. Manage Potential Surprises

Even with careful preparation, a few surprises can arise:

Valuation differences: The lender's valuation may differ from the contract price due to the time passing between pre-approval and settlement (sometimes years), impacting your loan amount.

Interest rate changes: Variable rates will fluctuate before settlement, and are mostly dictacted by the Reserve Bank of Australia (RBA).

Additional cash requirements at settlement: Conveyancers and brokers will alert you early, but always keep a contingency buffer.

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Having these risks in mind and maintaining open communication with your broker will help you navigate any challenges smoothly.

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7. Settlement Planning

As settlement approaches, finalise your funds and ensure everything is coordinated between your broker, lender and conveyancer. Having contingency funds set aside is essential to cover any unexpected costs and complete the purchase without stress.

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Key Takeaways

1. Start by understanding your funding options and plan a realistic budget.
2. Obtain pre-approval if possible. It provides clarity and reduces risk.
3. Work with a broker specialising in international buyers to guide you through lender requirements.
4. Prepare all required documents carefully and consider currency exchange timing.
5. Anticipate potential surprises such as valuation differences, interest rate changes or additional settlement costs.
6. Maintain contingency funds and communicate closely with your broker and conveyancer.

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With proper preparation and the right guidance, applying for a home loan in Australia as a first-time overseas buyer can be straightforward and stress-free.