Contemplating the purchase of a new house can be an exciting time. You consider where you might want to live, what kind of house you want, which features are must-haves and which are a little further down the priority list.
But if you’re in the market for a new home, should you buy an existing property or build new?
Maybe you should buy new…
There are lots of reasons why you might decide to build a new property from scratch. One of the biggest is that you have the chance to make it exactly what you want.
You get to have a hand in the design in a way that you can’t imagine if you’re buying a house someone else built 30 years ago. Even if you can’t afford all the features you want in your new home immediately, you can make provision for them to be added in the future.
There are some more prosaic reasons to build new, too. For example, it’s often easier to get a loan for a house that’s under construction. Loan-to-value restrictions that limit new bank lending to low-deposit borrowers don’t apply to new homes, so the bank should regard your application more favourably.
You should also be able to expect that a brand-new house will require less maintenance expense over the coming years because everything is new from the outset.
You’ll also get a builder’s guarantee to cover the first 10 years of ownership, which covers things such as work not done properly or unsuitable materials being used. Even the appliances will all be under warranty.
New homes should be warmer and drier, as a rule – although the weather tightness issues of the early 2000s show that’s not always the case.
Unless an existing property makes more sense…
The biggest problem with building new may be finding a place to do it.
It’s increasingly difficult to find sections on which to build for a reasonable price anywhere near the centre of our biggest towns and cities – so if you want a new house, you may need to be prepared to go a bit out-of-town to get one.
If you’re building in an existing subdivision, there may be caveats limiting what you can do, or rules you’ll have to adhere to.
You’re at the mercy of the builders when you build. While you can see and touch an existing house – and have an inspector out to check it – with a new build, you’re reliant on the construction company to do what they say they will, when they will.
Research last year indicated that building new was only a better price proposition in areas where prices were high or rising quickly. If the market’s softer you may get a better deal from buying an existing house.
Whatever you choose, we’re here to help
As mortgage advisers, we’re here to help you step on the property ladder. Get in touch with us today to discuss your action plan to dream-home ownership.
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek advice from a financial adviser.