Dozens of developers are spruiking off-the-plan apartments in capital cities across Australia.

With Sydney and Melbourne, in particular, going through a property boom in the past few years, for many investors it can seem a more affordable option compared to a house with land or an existing apartment.

Off-the-plan purchases involve putting down a deposit, usually 5-10 per cent of the developer's asking price for the unit, with the rest of the purchase price due on completion.

Many buyers see it as a good bet, with a relatively small upfront deposit, a couple of years to save more towards the ultimate purchase price and the prospect of a capital gain between signing the initial contract and final settlement.

Some states, such as Victoria, even offer incentives for first home buyers to purchase newly constructed property.

However, financial advisors warn that, with tens of thousands of new apartments being constructed this year, oversupply is a major issue.

Financial advisors, real estate agents and buyers' agents also warn that there are other less obvious risks when buying an apartment off the plan.

Here are some of the other risks involved with off-the-plan purchases.

The finished product is sometimes different to the plans

Financial advisor Daryl Dixon warned fittings, fixtures, and even floor plans can be different to what was in the original contract.

"I recently heard of a case where the final product was quite different from what they had envisaged they were going to get ...one thing about off-the-plan you don't know what the final product will be," he cautioned.

"The worst problem I've seen is the balconies are not all that well constructed."

Property experts warn that the finished apartment may be quite different to the glossy brochures and plans. ( ABC News: Margaret Burin )

Trouble renting out

Vacancy rates from SQM Research indicate that in inner city areas, where most off-the-plan apartments are, it has turned towards a renter's market.

In inner-Brisbane the vacancy rate is over 5 per cent and real estate agent Dean Yesberg said that, with 13,000 apartments proposed or built this year, there is a huge oversupply of apartments.

"Renters have got choice and we're finding it's taking longer to rent properties, we're also finding rents are starting to ease off," he observed.

For the first time ever, developers and traditional real estate agents are offering sweeteners to compete for prospective tenants.

"We're starting to see offers of six months internet free, iPads, we currently have quite a few properties giving a week's rent free and also $500 Coles vouchers," added Mr Yesberg.

Canberra too is seeing an oversupply, made worse with a decline in public sector employment.

SQM's Louis Christopher says vacancy rates in Darwin have reached 4 per cent and almost 7 per cent in inner Perth - reflecting the end of the mining boom.

"Perth and Darwin are our chief cities of concern. Vacancy rates could still rise and put further downward pressure on the rental market - great for tenants not so good for existing investors in those cities," he said.

Shortfall with the bank

Buying off-the-plan, investors take the developer's word at what the apartment will be worth when finished - but banks value only on completion.

Banks have recently tightened their lending terms for investors and sometimes will not increase what they are willing to lend.

For example, an investor might sign a contract to buy an apartment for $500,000 in 2016 but by the time it's finished in 2018 the bank values the property at just $400,000.

The bank will not lend the investor any more, but the buyer still needs to find an extra $100,000 to pay the developer.

This can mean owners are scrambling to secure finance to make up a shortfall - usually at a high rate of interest.

"They have to find additional money," said Mr Dixon.

"In some cases, if they don't complete the contract the properties are put up for fire sale again. The purchaser is still liable for any loss involved at the time of the resale."

With tens of thousands of units being completed over the next couple of years, prices in most cities are expected to fall. ( ABC News: Margaret Burin )

Slow appreciation

Any fire sales are likely to end in disappointment.

Buyer's advocate Sam Lally warned it can take years for resale value to equal what was paid originally.

"There's just far too many of them. They're compromised on space, compromised on size," he argued.

"There's no scarcity value, they're all the same. So if you have one apartment on the market, there'll be another one in the same building probably anyway."

According to NAB, apartment sale prices are forecast to stay flat or fall in all capital cities this year, as tighter credit, worsening affordability and increasing supply hit the residential market.

NAB forecasts Melbourne and Perth apartment prices will drop the most, at 3 per cent.

In Brisbane, Mr Yesberg said it has taken eight years for off-the-plan apartments to reach the price they were bought for.

Mr Dixon advises people that apartments really do not give the appreciation duplexes or properties with some land content do.

"In Canberra, the best performing part of the market has been blocks of land, ex-government built on blocks of land," he observed.

"It's pretty hard to say an off-the-plan purchase is a great way of getting investment property, particularly if talking about the long term.

"The good old days of buying off-the-plan and being sure the property will be worth more when you settled then when you paid for it are long gone."