There are a lot of factors to consider before buying a property, but to help you weigh up your options we’ll take a look at the positive and negatives of buying a new property versus an established one.
Buying new – The pros:
Modern standards – If money wasn’t an option than most people would probably prefer to live in a new property with all of the latest mod cons. Modern properties are built using modern day standards and designs and are usually a lot more energy efficient and environmentally sustainable.
Easy maintenance –There’s nothing that needs to be done at a new property except to move in and enjoy. This is extremely appealing to both owner-occupiers and investors who don’t want to have to worry about things breaking down or replacing old items. If there are any issues with the property in the first few years it should be covered under the builder’s warranty.
Investment appeal – New properties present a number of benefits to investors. They normally attract higher quality tenants and tend to have lower vacancy rates too, simply because most renters want somewhere that is modern and hassle-free. New properties also come with maximum depreciation benefits.
Harder to determine prices – Pricing a brand new property can be difficult, particularly if it’s in a brand new estate. Normally you would be able to look up comparable properties, however this might not be possible for a housing estate in an unestablished area, or for apartments that offer new amenities or features that distinguish them from other similar properties in the area.
Off the plan properties don’t exist yet – When buying off the plan you essentially buying a property that doesn’t exist yet. This means you won’t be able to inspect the property until it’s complete and it might not look how you expected. There’s also a risk that the build will take longer than planned.
Hard to add value – With everything already being done at a brand new home, there’s not a lot of room to add value. While you might be able to renovate and flip an older property to get higher returns, for a newer property you will need to rely solely on market growth before expecting any capital gains.
Buying established – The pros:
Price – A major benefit of buying an established home is that it’s normally easier to negotiate the price down. You also have the benefit of being able to compare the property with other similar properties on the market and look at historical data to figure out a fair price.
Less competition – Properties showing a bit of wear and tear can be off-putting to some buyers, but if you can see beyond that then you can snap yourself up a great deal. However, if you plan to buy a property that you want to renovate then ensure you get a building and pest inspection and factor renovation costs into buying.
Established homes aren’t easily replicated – There can be a lot of charm and character in older homes that can’t always be captured with a new build. When you buy an old home you are buying its history too and this can hold a lot of value for some buyers.
It’s not new – If you’re used to living in a modern home it can take some getting used to an older property. Older homes can have bad layouts and may not have many of the mod cons that many people now take for granted.
Potential maintenance and repair issues – Older homes may have a number of issues that don’t become apparent until things stop working. Costly repairs can include re-wiring, replacing asbestos materials or replacing old pipes and guttering, just to name a few.
Less appealing – Old rundown properties aren’t very appealing to live in whether you’re an owner-occupier or tenant. If you plan to buy an older property you need to consider its current condition and how comfortable it will be to live in.
So which is better?
There’s a lot of factors to consider when deciding on the best property to buy and old versus new is just one part of the equation. Both established and new properties can make fantastic homes and investments, and what is right for you might come down to budget or the area you want to buy in.
An established property could make more sense if it is affordable, easy to renovate and in a good location. Likewise, new properties can be a great option for those looking for low maintenance living or an attractive investment.
Understand the area you want to buy in and what properties make the most sense. Different types of properties will be in greater demand in different areas depending on the preferences of local residents and many other factors.
Get to know the area you want to buy and if you need any help in the Bacchus Marsh area then contact us at Arbee Real Estate.