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Published on 21 Feb 2023
One of the most common questions from buyers is whether it’s better to purchase an existing home or a new property off plan from a developer, but there isn’t a one-size-fits-all answer as both options have their pros and cons, so it ultimately depends on your unique requirements.
Everyone is different and has their own set of circumstances that influence the decision but, at the end of the day, the only way to make the correct decision is to make an informed one, so take the time to figure out which option is the right one for you.
Existing homes
Pros:
1. The neighbourhood is usually established so there is little risk of having to endure the disruption of ongoing construction. At most the odd renovation might cause a minor inconvenience.
2. These areas also have developed infrastructures and, more often than not, there will also be conveniently located amenities like shopping centres and schools in close proximity.
3. Gardens also tend to be well established, so you won’t have to spend valuable time and additional money on creating a garden from scratch and trees will be more mature and able to provide shade and ambience.
4. Many existing homes will have traditional or character features that are no longer included in new builds or even available on the market.
5. For the most part, you know exactly what you’re getting and if you have any doubts, you can commission a professional home inspection.
6. You can usually move into your new home much quicker than a new build.
Cons:
1. The property may be dated and in need of modernisation or even renovation which will add to the initial outlay.
2. It’s likely to require maintenance sooner than a new build which can prove costly over time.
3. Although small maintenance issues are to be expected, there could also be major defects which only become evident later on, so it’s important to thoroughly inspect the property before putting in an offer. Depending on the age of the property, it may also be prudent to pay for a property inspection.
New Build
Pros:
1. Everything will be fresh and new with none of the wear-and-tear of a previously lived-in property so no major maintenance, refurbishments or repairs are likely to be necessary for the next three to five years.
2. If buying off-plan, you can often choose the layout you prefer and the size of the unit and there is also usually a list of finishes from which to choose.
3. A new build can also cost less than a similar existing home as there is no transfer duty (you do pay VAT) and some developers also add extras such as build-in appliances/features or even a levy holiday.
4. It’s easier to build an energy efficient house using all the new materials and products than to install energy-efficient features to an existing home which will never be at quite the same level as a new build.
5. New builds are frequently in new neighbourhoods so although the area may lack the number of amenities of an existing neighbourhood, they are likely to be more modern with more current offerings.
6. Newly built homes come with a National Home Builders Registration Council (NHBRC) five-year guarantee and the roof guaranteed for one year.
7. Buyers also have a stipulated period after moving into the property during which time any snags will be corrected or repaired by the developer.
8. If you buy from a developer the Consumer Protection Act (CPA) will safeguard you, whereas if you buy from a private seller the CPA doesn’t apply.
9. Whilst some people value character and a sense of history or tradition in a property, others may prefer owning a home that is specially customised to their tastes and needs and in which no-one has ever lived.
Cons:
1. The waiting period until completion and transfer might not suit you and it may also be a considerable time if you buy right at the beginning before they break ground as the infrastructure will still have to be laid.
2. If you buy early in a new development with only a few of the planned homes already built, not only will you have to live in a sparse environment for some time, you will have to put up with contractors going in and out, and inconveniences such as temporary water or power outages whilst the other properties are being built.
3. The choice of designs and finishes is usually limited.
4. It can be a chore working through snag lists when you move in and it could take a while for the issues to be fixed.
5. You may not be able to visualise the end product from the plans and architectural renderings, so the final product may not be quite what you envisaged.
6. You don’t have much control over the end product nor issues that could cause delays or any number of problems.
7. Although there are no transfer costs, legal fees and bond registration fees are the same for both types of property, and are not always covered by the developer so be sure to check.
To safeguard yourself, always check the track record of the developer to establish quality of workmanship, reliability, financial stability and integrity. Also, double check all the specifications and finishes agreed upon to make sure the end product will be exactly what you wanted.
Whether you decide to buy an existing property or newly built home, both are great options with their own set of pros and cons, and every family will have different circumstances driving their decision.
However, once you have all the information, it will be much easier to choose between the two and the easier it is to avoid potential pitfalls and minimise the risks.
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