Some investors go for older properties – but is that the right move?
There is nothing quite like buying something brand new, especially when it comes to your property. There are many benefits of a new build home that you just don’t get with an old house. Buying a new property will give you a number of advantages over established properties.
For instance, according to homeloanexperts.com.au’s case study, a purchased new unit from NSW with $0 spent on renovations has seen a major 34.9% growth over 11 years, despite Sydney prices doubling in this time.
Advantages of New Build House
- Built for Modern Living – Generally, newer houses/units have modern amenities, appliances, and technologies pre-installed as such tenants are prepared to pay a premium. Being able to attract high-quality tenants means you reduce the risk/frequency of vacancy on your investment property.
- Government Incentives and Benefit Deals – Incentives such as the First Home Owners Grant for first home buyers can reduce the upfront funds, plus they only need to pay stamp duty on the land value when buying a house and land package.
- Security and Protection – All new build house has a Home Building Compensation (HBC), formerly known as Home Warranty Insurance (HWI), which is a legal requirement in all states that serves as the builders’ warranty insurance (in NSW, the home building compensation fund) to affords certain protection against structural/major defects.
- Low Maintenance Overheads – When you buy a new property, you can benefit from the convenience of not having to spend money on repairs or ongoing maintenance.
- 10-year Building Warranty for any Needed Structural Repairs – Builders provided 10 years of coverage against structural defects to the designated load-bearing elements of new construction homes.
- Energy-Efficient and Produce Fewer Carbon Emissions – Modern homes are built for our new green-driven society, with things like solar panels, low-energy appliances, and insulated walls.
- Unique and Boutique – Small subdivided areas in established suburbs have good immediate capital growth potential.
In the end, buyers should actively resist the temptation of up-front savings or emotional attachments. It’s more of the right property and location selection that will give you more opportunity for capital growth and rental yield potential.
