Pros and Cons of Buying a Newly Constructed Home

Are you in the market for a new home? If so, you may want to consider buying a newly constructed home.

These homes are brand new, have never been occupied before and they often come with all of the latest features and amenities. Depending on the developer, you may even be able to customise them to suit your own unique needs and preferences.

While there are many pros to buying new construction homes, there are also some cons that you should be aware of.

So let’s discuss both the pros and cons of buying new construction homes so that you can make an informed decision. Let’s get started!

What is a Newly Constructed Home?

Brand new construction homes are homes that are built from scratch, often by a developer. The developer will create a model home and then sell individual plots of land to people who want to build their own homes.

This is in contrast to buying an existing home, which may have been previously lived in by someone else.

Pros of buying new construction homes

Brand New

One of the greatest advantages of newly constructed homes is that everything is brand-new. You will be the first person to live there, use the appliances, turn on the lights, and use the loo.

Everything in the property will be in beautiful shape, and it is unlikely that you will need to make expensive repairs in the near future.

First Home Owner Grant

If you’re a first-time home buyer, you may be eligible for the First Home Owner Grant. This is a government grant that can help you with the costs of buying your first home, depending on where you are located in Australia.

For example, if your new-built home is built in regional Victoria, you may be granted $20,000, however if you’re located in Queensland, you may receive $15,000.

Warranty

Newly constructed homes also generally come with a warranty, so if anything goes wrong (that is covered under the warranty), you are covered from major defects for six years after completion.

More negotiating power with the developer

Another thing to keep in mind is that you’ll likely have more negotiating power with the developer. Since they want to sell as many units as possible, they may be willing to give you a better deal.

This is especially true if you’re buying during the pre-construction phase when prices are usually lower.

Energy-efficient

Newly constructed homes are assessed for their energy efficiency based on factors such as heating and cooling, sound, sunshine, and ventilation.

Homeowners who chose to build from the ground up may have the option of customising any of these features, including adding more insulation, installing solar or rainwater tanks, or putting double-paned windows where appropriate.

Low maintenance

Since all plumbing, electrical, fixtures, and fittings are brand-new and have a great deal of life remaining, there would be no old, worn-out parts that need to be repaired or replaced that can cause you headaches and hassle down the line.

Usually located in burgeoning areas

If you’re looking to buy a newly constructed home, chances are it’s because you’re interested in moving to a newly developed area. These areas are often growing rapidly, which can mean big returns on your investment down the line.

Cons of buying a newly constructed home

Takes time to build

One of the biggest cons is that it can take a long time to build a brand new home. The process usually takes anywhere from six months to a year, or even longer.

This is in contrast to buying an existing home, which you can move into much sooner.

Costly

Another thing to keep in mind is that the cost of buying a newly constructed home can sometimes be higher than existing homes.

This is because you are essentially paying for the land, the materials, the labour, and the profit of the developer or builder.

You will also have to pay interest on the finance during the construction period of your home, which will be on top of any rent payable.

To save some money, you may be able to negotiate and buy during the pre-construction phase, which is when you can often get a better deal and reduce some of these costs.

Final Thoughts

Some people love the idea of buying a brand new home. They love the thought of being the first person to live in their home and being able to design and customise it to their own liking.

So before making your final decision, it’s important to weigh the factors that are important to you including financing.

With Rostron Mortgages, we’re here to help you every step of the way!

Whether you’re taking your first steps into the property market or upgrading to a bigger family home, we can help you find the right mortgage.

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