Are you in the market for a house in the Eastern Bays (Orakei, Mission Bay, Kohimarama, St Heliers, Glendowie) and Remuera? Whether it is an upgrade, a downsize or your first home, there are various considerations to be had as to whether it is better to build a brand new house or buy an existing one. While there is no right answer, knowing the advantages and disadvantages would allow you to make a more informed decision.
Pros of Building a New Home
1. Full Customization
If you decide to build a new home, the biggest advantage is the ability to customize the home to your exact wants and needs. Sometimes, there just isn’t a house in the market that fit your needs. For example, there are many downsizers looking to buy a single level 3 bedroom home that is modern with double garage and perhaps within walking distance to Tamaki Drive (close to beach) or parks like Churchill Park or Glover Park. However, existing homes in Orakei, Mission Bay, Kohimarama, St Heliers, Glendowie are more likely to have two storeys with no lifts and single level homes either don’t have a garage or do not have modern features.
In addition to choosing the floor plan you desire in your home, you also have the ability to select the quality of finishing. If you’re looking for a home with granite counters, high end cabinetry, and timber flooring, you can have it customized to your desire. In a new build you control exactly how your home will look when it’s completed, which is an obvious benefit to building a new home.
2. The New Home Smell
There’s a pretty good chance you’ve heard people say that there is nothing like the smell of a new car. The same can be said about a new home. If you decide to build a new home, a benefit is the “new home” smell.
If you have ever been in the market for a home and looked at existing homes, you’ve probably walked into a home that had a foul odor. It’s a horribly unpleasant experience and foul odors are one of the top things that scare away buyers from a seller’s home. Sometimes it’s a wet dog smell, othertimes it’s a smell of their cooking or even cigarettes smell. Either ways, it’s not easy to get rid of the smell. If you decide to build a new home you do not have to deal with odors and that is something clearly desirable.
3. More Efficient Home
Another benefit to building a new home is that the home is going to be far more efficient than an existing home. There is no question that a newly built home is more efficient than a home that was built in 1930s. There are many areas in a new home that will be significantly more efficient than an existing home.
One of biggest components in a new home that will be more efficient than an existing home is the level of warmth. New homes have double glazing, insulation top and bottom and in the walls. New homes might also have better designs that help to retain heat, new gas fireplace or even central heating/cooling system that ensures you are cool in summer and warm in winter. While many of these things can be retrofitted onto an old house, it is often cheaper to just start new than to try and get this into an old house. For example, some houses simply do not have roof space for central heating so you can only make do with what you have.
Cons of Building A New Home
1. Build Time
Anticipation often can drive home buyers crazy, whether it’s a new build or existing homes. One con of building a new home is the time it can take for the home to be built.
The build time will vary from builder to builder. Generally speaking, a new home will take a minimum of 6 months to build, and that is provided that your land already has all the services in place and your building consent is approved. If not, that might drag on for another year as Auckland Council can be notoriously slow and especially if it is your first time going through the process and you may not have all the paperwork ready.
Even if everything is in order, the general time period for building a house can be varied by many things that are out of the control of the builder, the buyer, and everyone else. Depending on the location of the new construction, weather can often add time to the number of days it takes for a new home to be built. Delay in building materials and stock like appliances can also hold things up. We know of houses in Orakei have had their build time extended by 50% because of such delays.
2. Unexpected Cost
If you decide to build a new home, make sure you understand there may be some unexpected costs that can arise at anytime, which is an obvious drawback to building a new home versus buying an existing home. Nobody likes surprises, period, but when it comes to new construction, they can and often do occur.
A prime example of an unexpected cost during the construction of a new home is additional excavation costs. Unfortunately there is no crystal ball that can predict what exactly will occur once ground is broken. While it would be nice, a contractor is not going to work for free. If the excavation is taking longer than anticipated and is costing more labor hours, the costs in all likelihood will be passed on to the buyer.
Prices of construction materials might also increase during the period you are building and your builder is likely to pass on those costs to you. Often such costs can balloon and it will cost more for you to build than to buy a brand new existing home.
Therefore, when building a new home, you have to budget for contingencies so that you are not shocked by unexpected costs.
Pros Of Buying An Existing Home
1. Quicker Possession
When buying an existing home, generally the settlement date occurs 1-3 months after a contract goes unconditional. This is considerably less than the average build time of a new home. If time isn’t on your side, a big plus to purchasing an existing home is the quicker possession.
There is also certainty in knowing exactly when you can move in because the house is already there. You will not be affected by delays in the build or delays in paperwork with the Council.
This is especially important if it is not easy for you to just pack your bags and stay somewhere while you wait to move into your next home.
2. Better Value
In most real estate markets, you will be able to get more for your money when buying an existing home versus new construction. One benefit to buying an existing home is that you can get a larger home on a larger piece of land and a home in an area you really want to live in.
In most cases, buying an existing home is a better value than buying new construction. You might not have all the bells and whistles you would like in building your new home. However, you get to buy into an area that you like and real estate is all about Location, Location, Location. The current house that you buy may not be modern but will give you better capital gains in the future.
3. Classic Charm & Characteristics
While classic charm and characteristics can be added to a new home, it comes with a price tag. There is something to be said about an existing home’s natural hardwood flooring (some of which can never be found in new homes like Kauri), leaded glass, and other classic characteristics that are not often found in newly designed houses. Some people like the classic 70s architecture with sunken lounges which are rare in brand new homes. Others like that an existing house has history and charm, for e.g. some houses have been lived in by the Auckland Mayor or have timber flooring that were salvaged from the demolition of Auckland Library. These are a part of history that can only be found in existing houses which can never be created with a brand new construction.
Finding classic charm and characteristics can actually be done fairly easily when buying an existing home. If you’re looking for classic characteristics, a huge benefit to purchasing an existing home is that you should be able to find them at an affordable price.
Cons Of Buying An Existing Home
1. Not Exactly What You Want
One negative to buying an existing home is the fact that you will likely not find a home that has absolutely everything you’re looking for. When buying an existing home, you must be ready to make sacrifices. Whether it’s the location of a dining room or the size of the wardrobe in a bedroom, a negative to buying an existing home is you cannot determine all the details of the home.
If you decide to purchase an existing home, it’s recommended you determine what your wants and needs are in a potential home, before you begin looking. If you need to have a finished basement and a 2-car garage, make sure you are prepared to give up other things that may be something you wanted in a potential home. Once you can separate the must-haves from the good-to-haves, it is much easier to find a home.
Bearing that in mind, sometimes, an existing house may not have everything you want but you can easily add on later and that would be a much smaller job than building new. So you need to weigh the two options and see which one works out better for you.
2. Upgrade & Renovation Expenses
If you decide to buy an existing home, knowing that you will have to make changes is important. With the desired changes you want to make comes a cost. Having additional costs to upgrade or renovate an existing home can be a drawback to buying an “older” home. After buying a home, many home buyers don’t have tons of money remaining and may not have the money available to make upgrades and renovations.
The above pros and cons to both buying a new home or an existing home should be able to help you decide which is the best option, if you happen to be on the fence. Whether you decide to build a new home or buy an existing home, it’s going to be a very exciting time.
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