Flipping off-plan property was a mainstay strategy of property speculators over the past few years. With fast rising house prices, the idea was to put a deposit down on a home before building starts and then sell it when construction is completed.
Meanwhile, all the capital at risk is the deposit and the profit comes rolling in at the end as the property value appreciated during the construction time. Now, builders are mothballing their projects or selling them off at a supposed discount to stave off the creditors as off plan speculation has dried up.
Off plan was always a high-risk strategy- and now it’s hit a wall with the recession, according to the International Herald Tribune.