Should You Buy an Established Property or Build From Scratch?
Land is at a premium in Australia’s most populous cities, but that doesn’t mean you can’t find your dream home in a suburb that matches your lifestyle. The only question is: should you buy an established property or build one from scratch for your first home?
Each choice comes with its own benefits and drawbacks, and it’s important that you do your due diligence before making a decision. To help get you started, we’ve covered the pros and cons so you can find the property you’ve always dreamed of.
Pro: You can do a physical ‘walkthrough’
With an established home you know exactly what you’re getting. Not only can you review all the specifications and look at professional images of the property online, but you can do a physical inspection to ensure it’s right for you. A walkthrough will also give you a better idea of the space, what changes you’d like to make, and how the suburbs suits your needs (such as proximity to neighbours, what schools and cafes are close by, and how far you need to walk for public transport).
Pro: You’ll be closer to the CBD
Even in the outer suburbs of cities like Brisbane people are finding it more and more difficult to buy land. That often means if you want to build, you’ll have to settle for not living close to the CBD. But with an established property you don’t have to worry about finding a home in your suburb of choice – your only barrier is your budget.
Con: It may be more expensive
Depending on where you want to live, research shows that it’s actually cheaper to build than to buy an existing home – particularly in major cities.
Con: You can’t design your ‘dream’ home
Everyone dreams of their ‘perfect home’ – the one with all the bells and whistles customised to their heart’s desire. But with an established home that’s not possible. No matter how wonderful the property is, it won’t truly be made by your design, and you’ll often want to make changes or renovate it entirely. If you want a home that matches your dream, then buying a house and land package is the way to go.
BUILDING FROM SCRATCH
Pro: No stamp duty on the home itself
In addition to the First Home Owner Grant for first-time buyers, those who choose to build from scratch can enjoy lower fees on things like stamp duty. This is because you only pay stamp duty on the land only and not the house itself. It’s also the case when you buy a newly built home that no one else has lived in, such as in a new real estate development.
You can also take advantage of the First Home Buyer Assistance Scheme when buying vacant land. This means that if the land is valued less than $350,000 you won’t have to pay any stamp duty. At a new development such as Brentwood Forest– where the majority of land packages are priced below that threshold – you can save on extra costs and put that stamp-duty money into building your dream home.
Pro: Energy efficient and environmentally friendly
It depends on your builder and building designs, but for the most part building, a home is better for the environment. As they are built with modern materials and have new appliances installed, which are often more efficient than dated fixtures in established homes, newly built properties tend to use less energy. You can even go one step further and integrate ‘passive design’ – which leverages natural resources like the sun and wind to be more environmentally friendly – into your build.
Con: You may not be able to live in it immediately
Depending on whether the house has just been built or not, you may have to wait several weeks or even months (if it still needs to be designed before construction can begin) to move in. This isn’t necessarily a bad thing, as even with buying an established property you typically have to wait a set period before settlement.
What’s more, this ‘set period’ is doubly positive because it provides you with an extended window to save extra money before settlement occurs.
Con: Costs aren’t always fixed
Again, this depends on your builder and how your design decisions factor into construction, but sometimes the cost of building a home doesn’t include what you expected (such as light fittings, driveways and fences). Expenses may also add up if you decide to make modifications midway through development. In all things, it’s important to ask lots of questions of the builder to ensure you get exactly what you want.
Content originated from Waterford.