Whether you’re looking for your first home or your next home, it can be tricky to decide if you should purchase an existing property, or build your own. An existing home means getting a better location and knowing what you’re getting into, but is it right for you? Here’s part two of our Build or Buy blog.
- More room to negotiate
When purchasing an existing home, you might have a bit more negotiating power when it comes to placing your offer. If there’s work that needs to be done, or damage that needs to be repaired, you can factor this into your offer to make it worth it for you.
- Better location options
Many new builds are often restricted to areas where there’s more land, but this isn’t likely to be as close to urban areas as you’d like. If you like to be near a city or the area where you work, you’ll likely have more options with an existing home.
- Easier to get finance
Because the home has already been built and valued over time, your bank or lender can easily see the true value of your home. There’s also likely to be less risk with any unconsented work, so you might have an easier time sorting out a mortgage.
- You know what you’re getting into
With an existing property, you can check out every nook and cranny and get a builder’s report to highlight any areas of concern. You would assume that a new build would be done to a higher standard than an existing home, but that’s not always the case!
- Taking the home as is
Yes, you might have a greater awareness of what you’re getting into, but you will still be the one bearing the costs and sorting out the work that needs to be done. If there’s a lot to renovate, you might be better off with a new build in the long run.
- May take longer to own
Although there might be a wider range of existing homes for you to choose from, there’s also a fair amount of competition out there. Because of this, it might take longer than you expect to find the home of your dreams.
- Larger deposit
With most existing homes, LVR restrictions apply, so you would likely need to pay at least a 20% deposit upfront to secure the home. This is fine if you’ve reached your savings goal, but this can still be a far-off dream for many.
- Negotiating can be stressful
Even though you’ve found the home of your dreams, it doesn’t mean that you will automatically win the sale. Owners can be particular about the price they’d like to sell their home for, and throughout stressful negotiations you might end up paying more than you’d like.
If an existing home is the way to go for you, get in touch with our friendly mortgage team who can help you reach your home ownership goals fast!