REIWA: To buy an existing property or build new?
Those people who buy newly built properties generally say it’s cheaper, convenient or more desirable to buying an established home because all the hard work is done.
Although many buyers of existing homes eventually renovate which can be costly if it’s an older property.
Those who prefer to build say it’s worth the extra cost and effort in order to have a home that meets their particular desires and first home buyers, in particular, are eligible for the $10,000 grant.
Building a new home also provides the opportunity to include some of the latest features or environmental benefits that may be absent from established stock.
In recent years there has been a surge by people in their 40’s and 50’s wanting to build their long-desired dream home, often assisted by the availability of land in older parts of the metropolitan area through urban infill policy.
Ultimately, it’s the cost comparison between building or buying that will usually decide which option people choose.
In recent years Australian Bureau of Statistics data has shown that the cost of building a project home increased by upwards of 16%.
However, now that construction elements within the mining industry have slowed, finding skilled workers to develop land and undertake the building of new housing is easier and more available. As a result, overall costs have levelled or come down a little.
Developers have responded to the changed market with some excellent house and land packages to help buyers with more affordable options.
First homebuyers should still be careful not to over extend themselves financially. Buying an affordable, existing home can often be a better option and 70% of first time buyers choose that. Either way it’s important that people seek professional financial advice before committing to home ownership.
First homebuyers in WA have a good supply of available land on which to build with around 1,340 blocks of land currently for sale in Perth’s suburbs and more options in the regions.
Interestingly, our state retains a strong housing culture driven by the desire of most people to live on a green title lot with a stand-alone house. For example, whereas 50% of all new dwellings in Sydney are units, apartments, villas and townhouses, in Perth only around 20% are. Houses dominate here.
Perth remains the most suburban capital city in Australia because it has the least number of grouped dwellings as a percentage of overall stock than any other Australian city.
Although, there are signs this is changing a little with plenty of new-build and Off The Plan construction underway with apartments around central parts of the metropolitan area near shops and transport nodes.
Source: News Release Real Estate Institute of Western Australia 03 June 2014