To buy new or not to buy new
In this time of low listing volumes, building a home, purchasing a house and land package or buying a brand new property is increasingly becoming the natural option for those looking for their own home. We thought it might help those making the decision to look at the reasons for buying new vs buying established homes.
Why build/buy new?
- Comfort – newer homes are built to a more recent building code, meaning better insulation and double glazing. These benefits also mean cheaper power bills
- Cost – whilst this is far from an absolute rule, the current market is often making it cheaper to build than to buy. HOWEVER, the economics of build vs buy change regularly, so can’t be relied upon
- Lending – banks have more flexibility around lending on new builds, so there’s the ability to loan up to 80% for investors, who may be limited to 60% lending for established properties
- Safety - newer builds are built to higher standards for fire proofing and earthquakes
- Designed for life – new homes incorporate the features that we want for the way we live now, not 30 years ago. For example, multiple bathrooms, indoor-outdoor flow, internally-accessed garaging and walk-in wardrobes
- Build what you want – here’s the opportunity to create a home that works for you and your family
- No fears about leaky homes – it’s brand new with all the bells and whistles you’d expect including a nice clean Code Compliance Certificate!
Why buy established?
- It’s easy and immediate – no wrangling with council or long periods spent in design and consultation – just move in right away
- Bigger sections – new subdivisions are increasingly using smaller sections to allow for our urban sprawl. Older properties were built at a time when land was at less of a premium
- Section availability – there’s limited stock of land available for building and sections are often attracting premium prices due to competition
- Cost – no need to pay rent and a mortgage at the same time as necessitated by building, just move from one property to the next
- Area – the most desirable areas are often those which are already established, meaning to get into these places you need to buy what’s available. This can also give you more potential for long term capital gain by purchasing in the right place with future development potential
- Investors – for those that have the deposit, buying established means instant returns by being able to rent the property straight out vs waiting whilst it’s built
- No hidden costs – often when building people underestimate the costs of the extra bits – curtains, landscaping, fencing etc. An established home means no need to budget for these