- Advantages of building your own home: including the freedom to design your own space according to your preferences and needs. Building allows you to customize layout, features, and finishes, creating a unique living environment.
- Advantages of buying an established property: Buying an existing property is presented as a quicker path to homeownership, providing the opportunity to move in faster compared to the process of building a new home. Purchasing an established property also grants the advantage of seeing exactly what you’re buying upfront, avoiding the uncertainty of a new build.
- Factors to consider: Factors such as market trends, whether it’s a buyers’ or sellers’ market, and prevailing interest rates can significantly impact the financial viability of building versus buying. The bottom line is that the decision between building and buying depends on individual preferences, financial capabilities, and long-term goals
Building New vs Buying an Established Property
The biggest financial goal for most Western Australians is to eventually buy their own home. For this reason, the most asked question we see online is “is it better to buy or build a house?”. To help you make an informed decision we have narrowed down a list of pros and cons of either buying an existing house or building a house. Let’s do this! 🏡✅
So what’s better, building or buying?
If you’re short on time, here is a snapshot of building vs buying. Feel free to read on if you want to get into the nitty-gritty!
Advantages of building a new home
- Freedom to Create Your Own Home
- More Access to Government Grants
- Access to Construction Loans
- Lower or Completely Avoid Stamp Duty
- Lower Maintenance, and No Upfront Costs for Repairs
- Modern, Safer, Eco-Friendly Building Materials
- More Opportunity to Recoup on Investment
Advantages of buying an existing home
- Know What You’re Buying First-Hand
- Move into Your New Home Faster
- Access to Suburbs with Less Vacant Land
- Bigger Blocks
- Mature gardens and landscaping
- Potential for renovation
External factors that will affect your situation
- Market Conditions
- Interest Rates
Advantages of Building a New Home
Freedom to create your own home
The biggest advantage of building a new home is that you get exactly what you want, and this fact alone could be the reason you choose to build instead of buying an existing home.
Building a new home allows you to bring your dream home to life for now and into the future. You get to choose the layout of the floor plan, the placement of bedrooms, the size of your kitchen, and whether you want a home theatre, study, or extra-large entertaining area. You also get to choose the colour of your walls, benchtops, tiles, and bathroom fittings to make your house truly yours. It is a fun and rewarding journey watching your brand-new home come to life. 👪
It is harder to find an established house with a design that fits your exact needs, and it might not be possible to alter or renovate the layout to suit your exact preferences.
Save money with more access to government grants
In Western Australia, there are many government grants for home buyers available, but only “if you are purchasing or building a new home”. If you are a first homebuyer you might be eligible for a $10,000 First Home Owner Grant from the WA State Government.
Construction loans reduce the cost of your home loan during the build 💲
While construction costs might feel like a barrier to building, but you may find that the building process gives you time to ease into your repayments. In addition to Government grants, when building a home, the home loan is usually in the form of a construction loan which you pay gradually as the build of the home progresses, rather than forking out a large lump sum when buying an established home.
In comparison, it is typical for homebuyers to need a bigger deposit if they wish to purchase an already-built home, especially for more affordable homes and homes eligible for government grants such as the first home guarantee.
Lower or completely avoid stamp duty by building
Did you know that building your own house could reduce how much stamp duty you pay? In Western Australia, when buying an established home, you are required to pay stamp duty on both the land and house that you are buying. With a new home, you are only required to pay stamp duty on your block of land, which is a considerable saving. 👏
On top of this, in WA, you could completely avoid stamp duty if you are a first-home buyer and the house you want to build is under $430,000.
Lower maintenance, and no upfront cost for repairs
When building from scratch, your new home comes with warranties for a variety of aspects including structural, electrical Fit outs, plumbing, and flooring, to name a few. These are a safeguard for the very small chance that something goes wrong with your new home build. This gives you comfort that you are protected from hidden costs of repairs if something in your home breaks or is faulty.
When buying an established home, you accept the fact that the home has already been lived in. Therefore, there is a greater risk of faults such as plumbing, roofing, and electrical failure that you may not notice until after you have bought the property, and you risk footing the bill for any expensive repair costs down the track. 😱You also accept the home with any outdated features such as dated kitchens and bathrooms straight from the 60s. When you consider the current house prices in Perth’s established suburbs, if you don’t feel like taking on a personal construction project, you may want to consider the value of having a fresh new build.
This is not a scare tactic; it is a reality that comes with purchasing an existing home and a risk you need to factor into your budget if you go down that route. If you are set on buying established, make sure you invest in a building inspection so you can plan for any expected costs after your purchase.
If you choose to build, it is understandable that you may be worried about supply chain problems. If you want to mitigate your risk of going over budget or overtime during the home build process, the best thing you can do is get a good building contract together and work with a reputable home builder like Easystart Homes.
Safer and more modern building materials
One of the many benefits of building is that new construction allows you to avoid potential health hazards that can be present in older homes, such as asbestos, lead paint, or mould.
New builds also offer you the chance to incorporate eco-friendly materials into your home’s design. New builds use sustainable resources like bamboo, recycled steel, or reclaimed wood, effectively contributing to a more sustainable living environment.
But it doesn’t stop there. With a new build, you’re able to outfit your home with state-of-the-art energy-efficient appliances, toilets, and electrical fixtures. The result? A reduced carbon footprint and lower utility bills – a fantastic balance of environmental responsibility and economic wisdom. 🤑🌳
If you’re thinking about building a new home from scratch, it’s a green light to pack in all those earth-friendly materials and snazzy energy-saving features into your home design. In the long run, you can shrink your new home’s carbon footprint down to the size of a tiny footprint in the sand and save some serious dollars in the long run. 🌎 But, of course, the construction process does create some waste and emissions.
Now, if you’re thinking about buying an existing home, you’re side-stepping those construction hiccups. But (and there’s always a ‘but’, isn’t there?), an older home might not be as energy-efficient, and it could call for a bit more TLC and upkeep, especially if it’s not made with the most durable or efficient materials – especially if it was cheaply built. 🔨
So, both paths have their own little environmental footprints. It’s all about weighing them up and deciding what works best for your future dream home, but in the long run, a well-built eco-friendly design will put less strain on the environment and cost you less to power, heat, and cool throughout the year.
More opportunity to recoup on investment
It’s true, building a new home is still a hefty initial investment. But think about it this way: newer homes also have a certain charm that appeals to buyers, the same charm that a newly built house presents; less to fix, newer materials, fewer unexpected costs, and lower energy bills. ✨
Another point we have already mentioned (but deserves an encore) – a new home is likely to require fewer repairs and less maintenance. This means potential savings in the long run and less money sunk into your home after you move in, so if you ever decide to sell, you’re likely to see some handsome profits on the house itself.
Homes built between the 1940s and 1980s in Western Australia are known for using materials that are now banned in Australia as well as simply being old enough to require some serious maintenance. 😲
Advantages of Buying an Existing Property
What you see is what you get
Purchasing an established property means you can see exactly what you are buying right from the start, and you can physically walk through and experience the feel of the home before you buy.
Depending on your own circumstances, if you are in the financial position to look at existing homes in your desired location, then you may appreciate the ability to completely plan for the cost of the home purchase, given you know the purchase price, along with expected property taxes and expected maintenance from your property report. 🏠 Buying a house needs to be approached through careful planning, considering your personal situation. So, whatever you choose, the best recommendation we can make is to seek professional advice and consider all options; talk to a builder, talk to a real estate agent, and trust your gut!
Move into your new home faster
Purchasing an existing home usually offers a swifter path to ownership. Typically, once a suitable property is identified, the process can be completed within one to three months. However, consider that if substantial renovations are required, this can extend the timeline significantly.
Conversely, building a new home is a significant undertaking that requires a substantial time investment, often extending from several months to over a year. This duration depends on the complexity and scale of the project, making it a journey of patience and perseverance. But once the build is finished, your new house is problem-free. 👏🏡
At the end of the day, both options demand a certain level of time commitment, and it’s important to consider which aligns best with your schedule and lifestyle before deciding. If you are relocating for work, dealing with family circumstances, and other urgent scenarios in which building is not an option, then buying an existing home could be your best option. If you are in a comfortable living situation with no time pressure, it is worth considering a new build.
Access to suburbs with less vacant land
It is no secret that buying an existing home in a well-established suburb provides immediate access to mature amenities, such as schools, shops, public transport, and recreational facilities. 🛒🍔This can be a crucial factor, especially in areas where vacant land is scarce. Purchasing an existing property in these suburbs means you’re stepping into a community with a local culture and immediate access to infrastructure.
However, let’s not completely rule out the charm of building a house in a new area. Constructing your own home in an emerging suburb can offer its own unique advantages. This could be the opportunity to shape a house according to your preferences or the potential of the suburb to grow and flourish over time, adding value to your investment. While it might take some time for the community and amenities to develop fully, this could well be the start of an exciting journey in a place you can genuinely call your own. 🥰
Most of the time, an established property is set on a larger block. This is ideal for the great Australian dream of a big backyard, or it could mean future subdivision potential in the years to come. Perhaps you could build an investment property on the block or a granny flat for aging parents, teenage children, or a home office? 📈
Existing homes often come with mature gardens 🌴
One of the perks of buying an existing home is the mature landscaping that often comes with it. Not everyone considers that new-built homes come with new gardens, which could take a little time to reach their full potential.
When you buy an existing home with a garden, you immediately have trees providing cool shade and a splash of colour. These outdoor spaces are ready-made for a summer barbeque and backyard cricket.
However, it wouldn’t be fair for us to completely overlook the side effects of that lush gum tree that you fell in love with. It’s worth bearing in mind that older gardens might need a little extra TLC compared to their younger counterparts. You need to consider that many of those beautiful plants are as big under the ground as they are above, and they love water pipes.💦 It isn’t something that should stop you from buying that home you love, but it is something you should consider in your decision to buy or build.
New homes offer the potential for renovations
A big selling point of buying an existing house is the world of renovation possibilities that comes with buying an old home with its own unique character. With the potential for renovations and updates, you can sprinkle your personal touch throughout the house, adding value along the way.
Just remember, every rose has its thorn. Renovations can be exciting, but they can also be time-consuming and may require a sizable investment. So, before you start dreaming of that grand kitchen or luxurious bathroom, make sure to assess the scope and cost of potential renovations carefully. If you struggle to find time to pull weeds on weekends, then maybe it’s worth considering how well-equipped you are to manage water damage, outdated electrical systems, and living in a construction zone! 👷♀️Though you always have the option to talk to a professional Perth home renovatorif you do go down this path.
External factors that will affect your situation: Market Trends
There are a few key market trends to keep your eye on that can help guide your decision to build or buy like a pro real estate investor.
Market Conditions: Consider if it is a buyers’ market or a sellers’ market.
Imagine the real estate market as a big see-saw. Sometimes, it tilts towards a seller’s market, where homes are in high demand, but supply is low. This can drive up prices and competition for existing homes, making the idea of building your own place feel appealing. On the flip side, when the see-saw swings towards a buyer’s market with plenty of homes up for grabs, you might just find an absolute steal of a deal on an existing home that’s too good to pass up.
Interest Rates: If they’re high, it costs more to buy
Think of interest rates as the weather forecast for your financial future. When rates are low, it’s like a sunny day for both building and buying—it’s cheaper to borrow money, making homeownership more affordable. But keep an eye on those clouds on the horizon. If rates look set to rise, securing a rate with a new construction loan might be a smart move, like packing an umbrella for a day that looks like rain.
The bottom line of buying vs building
If there is one point, we want to get across to you, it’s that the question to buy or build will have a different answer depending on who you are, where you are, and when you are.
Building your home means it’s tailored just for you, potentially saving on costs like stamp duty and maintenance. It’s also a chance to make your home eco-friendly, modern, and possibly more appealing to future buyers.
On the other hand, buying an existing home gives you a clear picture of what you’re getting and can be a quicker process. You’ll also get immediate access to established amenities, possibly a larger land block, and mature gardens. Plus, there’s room for personal renovations.
Remember, market conditions and interest rates play a big part in your decision. In a seller’s market, building might be more appealing, while a buyer’s market could make buying an existing home more attractive.
In the end, it’s all about what suits your personal situation, budget, timeline, and goals. Don’t forget to seek professional advice—maybe give us a call? Whatever you do, prioritise making the best choice for you.