Should I buy or build a home?

Deciding whether to opt for a new build home or buy an existing home is a big decision so it’s wise to consider all the possibilities. While one method may be right for one person, the other will suit someone else more – so how can you know? 

To break it down, this article is an objective comparison of the two options, including the pros and cons of each. This way, you can determine what your priorities are and which method is the right fit for you.

Buying a new home

To buy an existing house, you will need to research the range of properties on the market and make an offer. After the legal transaction is complete, you’ll be the owner of the home and can move in immediately. 

Pros of buying an existing home

The key benefits of buying a house are convenience and cost, though these do depend on the house in question. Let’s explore this in more detail. 

Move in sooner 

If you need to move into a house within a tight timeframe, an existing home is likely your most viable option. Provided the house has functional facilities and is safe, you can move in as soon as you have the keys and have settled on the home. Typically, the process of buying takes a matter of months, from getting pre-approval to closing on an offer to settlement. That includes financing, viewing homes, making offers, inspections, and all the legal paperwork. This makes it one of the fastest methods for getting into a home.

Convenient location

If you have a specific area in mind, an existing home is probably the simplest choice. That’s because quite a lot of the desirable land is already built on, especially close to town centres and amenities. If you want a short commute, proximity to schools, and an established neighbourhood, buying a house with everything already in place is wise. 

Lower costs

Since they’re older, many existing houses are more affordable than new build homes. However, this does fluctuate with the market, so speak with your broker or financial advisor before making any offers. Once you've found a house you like, use a mortgage calculator to get a more accurate estimate of the total cost based on current interest rates. 

Downsides of buying an existing home

While the initial convenience of buying is appealing, the long-term downsides may sway your decision. See the following cons for more: 

Maintenance 

Older homes can require significant upkeep, which can cost a lot in both time and money. So even if you save on the initial purchase price, remember to budget for repairs, maintenance and renovations as well. Common examples of renovations include adding insulation, repainting, updating flooring, and remodelling the kitchen. If these renovations are major, you may need to move out temporarily. 

Less customisation

If this new house is going to be your home, you probably have an idea of what you want. Unfortunately, existing homes come as they are, meaning you can’t customise the layout or design to suit your needs without expensive renovations. While you can make some cosmetic changes over time, you may be stuck with things you don’t like. 

Building a new home

When building new, you decide how the house is laid out, which features are included, and how it is situated on the land. The process can take several months and involves design, consent, construction, and final sign-off. There are also various types of construction to choose from, such as prefabs, kitsets, and conventional onsite builds. 

Pros of building a house

New builds are highly customisable and low maintenance, making them popular with many prospective homeowners. To decide if a brand new house is right for you, consider the following: 

Customisable designs

When it comes to your dream home, it helps to have control over the layout, finishes, and overall design. Fortunately, this is easy with a new build home as everything can be decided in the early stages. You can decide everything from the number of rooms to the colours and textures on the walls. Unlike an existing home, this house is purpose-built to match your needs and requirements. 

Low maintenance

While existing houses tend to bring surprise issues, you know exactly what you’re getting with a new build. And, due to the standards of the current Building Code, newly built houses require far less maintenance than existing homes. That means lower ongoing costs, especially if you’re more likely to hire a professional than fix things yourself. 

Energy efficiency

New build homes are also far more energy efficient than older houses. While many existing homes aren’t well insulated, all newly constructed homes must meet the updated Building Code H1 standards, with significantly higher R-value requirements. That means the insulation is far more effective, making it much more affordable to maintain and heat a healthy home. 

No need to renovate 

Since you’re building from scratch, you can have everything exactly how you want it right from the start. That means you can move in straight away, with no need to make any changes. You'll also have a warranty with a new home, so if anything does happen, you should still be covered. 

First Home Grant

To improve New Zealand’s housing stock, the government is encouraging people to build instead of buy with the First Home Grant. This grant offers up to $5,000 for an existing house, while for building it is up to $10,000. Eligibility is per person so if you and your partner both qualify, you could get $20,000. 

Negatives of a new build house

As you can see, new builds are incredibly beneficial, but there are a few cons to keep in mind. They include higher initial costs and a longer wait time before you can move in. 

Higher costs

To be compliant with the current Building Code, new builds are typically more expensive. For some people, the higher price will be enough of a deterrent, while others will value the high-quality materials and customised design. To limit the risk of a budget blowout, choose a reputable builder with a fixed-sum contract. This way, the price is pre-agreed and you won’t be surprised by any unexpected price increases. 

Long build times

While many older homes are ready to move in, new builds will take a few months to be ready. From the day you sign a contract to the day you move in, the average onsite build will take about one year. However, it is worth noting that prefab homes are much faster and your home can be ready in less than seven months! 

So there you have it, the objective comparison between buying and building your new home. If you need to move in sooner and aren’t afraid of a few renovations, an existing home could be a sensible solution. On the other hand, if you’re looking for something customised to your needs and far less ongoing maintenance, a new build will suit you. 

If you’re looking for all the benefits of a new build with a more cost-effective and efficient process, take a look at the perks of the prefab home method: 

• Cost-effective construction

• Low labour costs 

• Fewer delays

• Customisable house plans

• Minimal disruption to your site

• Full compliance 

Want to know more? Talk to our friendly team today for everything you need to know about building prefab homes. We’ll share industry advice and discuss your options, so you can move into your dream home sooner.