How to read a developer payment plan

Start with the total

A payment plan divides one agreed price into stages. Before comparing plans, confirm the price includes parking, utility connection and registration-related charges, or ask for them to be listed separately.

The usual stages

• Booking reserves the home and takes it off the market.
• Contract is paid when the sale agreement is signed.
• Construction milestones fall due as the structure progresses. Ask how completion of each milestone is evidenced.
• Handover is paid when the home is ready to be occupied.

Questions worth asking

1. What happens if a milestone is late?
2. Are installment amounts fixed in the agreement?
3. How are payments receipted, and in whose name?

Nothing in this article is financial or legal advice.