ROI of New Builds at Construction Stage: How Not to Fool Yourself

Why buy off‑plan? 🏗️

Buying during construction often offers a lower entry price and the potential for price appreciation by completion. It also allows buyers to choose layouts and finishes. But without a realistic assessment, you can face construction delays, unexpected costs, or weak rental demand.

Key factors that affect ROI

• Location and local infrastructure — demand concentrates near transport, beaches, and amenities.
• Developer reputation — past projects and on‑time delivery are strong predictors.
• Quality of materials and finish — affects resale appeal and tenant retention.
• Construction timelines and delay risks — longer holds increase carrying costs and reduce returns.
• Rental market characteristics and seasonality — especially relevant in resort cities.
• Taxes, fees and ongoing costs — include all ownership expenses in forecasts.

Step‑by‑step ROI assessment ✅

1. Collect project documentation: permits, contracts, and stated guarantees.
2. Research market prices for similar units at expected completion date using multiple data sources.
3. Factor in realistic timelines and include time buffers in your plan.
4. Count all costs: deposits, financing costs, taxes, maintenance, and potential finishing works.
5. Build scenario models: conservative (delays, weak demand), base (on‑time completion, steady market), optimistic (strong demand and timely delivery).

Scenario thinking — practical orientation

• Conservative: delays and average rental yield may lead to low or no short‑term profit.
• Base: project delivered on time with normal demand — modest positive return over time.
• Optimistic: high demand and quality finishes — notable premium on resale or higher rental income.

We avoid fixed percentage claims because returns vary by project and micro‑location. Use scenarios to set realistic expectations.

Assessing developer risk 🧾

• Check completed projects and delivery records.
• Look for litigation or public complaints as red flags.
• Request proof of land ownership and building permits.

Contract points to watch

• Deadlines and penalties for delays.
• Price adjustment clauses and payment schedule details.
• Warranties for defects and post‑handover obligations.
• Restrictions on assignment or resale of the contract.

Financing and tax considerations 💼

Plan for financing costs and possible tax liabilities on rental income and sales. Local regulations can change, so consult local advisors for up‑to‑date guidance.

Exit strategies and risk management

• Set conservative margins and avoid relying solely on the best‑case scenario.
• Diversify investments rather than concentrating on one development.
• Consider long‑term rental if resale conditions are uncertain.

Practical checklist before signing 📝

• Valid permits and land documentation
• Developer’s portfolio and track record
• Transparent payment schedule and contract terms
• Market research for expected demand and rents
• Financing plan and time contingency

Final thoughts and next steps

Assessing ROI for off‑plan purchases is about balancing potential price gain with construction and market risks. Work with scenario models, verify the developer, and account for all costs. If you're interested in projects in Georgia, start with a targeted search at https://buyhome.ge/en/search and we can run tailored analyses for you.

If you want help building conservative and optimistic scenarios or checking a developer’s track record — contact our team at BuyHome. We’ll help you choose the property that fits your goals without illusions.