Price is only ever part of the equation. Buying a new dwelling has numerous benefits over buying a second-hand property. This particularly applies to investors. Few new residential developments, for mine, promote these benefits well enough. Some don’t even bother to discuss them at all.
New homes offer buyers:
- Great capital depreciation – with up to 60% of the built cost being tax deductible over time,
- A builder’s warranty – and often these days for materials too,
- Energy-efficient and more importantly, government-compliant “green” inclusions,
- The need for far less maintenance, and
- According to our research, about 15% more real value than a similar second-hand property.
That 15% is often forgotten about by buyers and valuers too. Think about the true cost of a new kitchen, bathrooms or a laundry. Don’t forget about the cost of new floor coverings; painting; air-conditioning; purpose-built storage; security screens and fencing. We have itemised these things across several new dwellings and have found that they can add up to well over $70,000, or about 15% more than the median sales price of a second-hand dwelling (in SEQ) that don’t have all these goodies.
Many of the things that a renter really wants can often only be found in a new home. Also, a recent QBE LMI survey found that 14% of first home buyers rent out a room after buying to help meet their mortgage payments. New homes make such rental arrangements easier.
There are many ways to sell property – price is important, but it isn’t the only ingredient.
