Buying New Property vs Established Properties
When you’re a first time home buyer the process of buying a home involves a lot of decision-making.
And one of the biggest is deciding whether a new property vs established home will suit your needs best. Let’s explore the differences.
What you need to know about buying a new property
If you’ve never owned a property before, you probably already know there are lots of different grants you may be eligible for when buying a new, never-before-lived-in home. The First Home Owners’ Grant (FHOG), for example, can get you $15,000 towards buying or building a brand-new house (if it’s under $750,000). If you’re unsure whether you can receive the grant, the Queensland Government has a handy eligibility tester.
In terms of stamp duty, if it’s the first time you’re buying a home then you may receive the First Home Concession ($8,750) depending on the cost of the property. And if you buy land that you intend to build on, the First Home Vacant Land Concession will see you get a full stamp-duty concession on land up to $250,000 and a reduced amount – on a sliding scale – on land worth up to $400,000.
While you’ll get the benefit of government grants and stamp-duty concessions when buying a brand new home, you’ll also need to consider other costs depending on your circumstances. If you go for a house-and-land package, most of the costs are built into the final amount, however, if you buy land to custom-build your property then you’ll need to think about additional expenses like a soil and contour test, home design by an architect, material costs, project management, labour expenses and more.
Finally, you’ll need to ensure your chosen builder is above board and your paperwork includes adequate statutory warranties like 6–12-month Non-structural Defective Work to protect your investment.
What you need to know about buying an established property
While you aren’t eligible for the FHOG when buying an established property, there are a number of other schemes you can take advantage of. The First Home Loan Deposit Scheme (FHLDS) is a new initiative that kicked off in January 2020 and will help 10,000 people buy their first property with as little as 5% deposit – with another 10,000 places set to open up in July this year. You might also want to boost your deposit by using the First Home Super Saver (FHSS) scheme, which will let you use up to $30,000 (or $60,000 as a couple) towards your first home.
Another positive is that an established property that’s been around for a while may have all the amenities you need nearby – unlike buying in a growing suburb that doesn’t yet have the infrastructure that older areas enjoy. That means things like public transport, shopping centres, cafes, healthcare facilities and parks could all be in close proximity.
You can also do a walkthrough in person. Pictures online don’t always tell the whole story, which is why it’s helpful to physically enter an established home and make sure it’s the right fit for your needs. When buying land or a new property that hasn’t been built, you can only rely on display homes or 3D renders to see what the finished product may look like.
There are also additional expenses you’ll have to consider. Stamp duty won’t be the same as buying a new home, and you’ll have to invest in a building and pest inspection to ensure there isn’t any structural damage that could have accumulated over the years – this is something you probably won’t have to worry about with a brand-new home.
Difference between buying and building new property
If your heart is set on getting a brand-new home, it’s important to distinguish between buying and building a new property. Many master-planned communities are popping up in the outer suburbs of capital cities and in major regional hubs like Toowoomba. With this type of new home, you’ll get to browse a range of different home designs and builders, then buy a house-and-land package. Do note that many of these homes won’t be ready straight away, so you’ll need to secure the timeline with the developer and builder once you’re ready to buy.
The other way of getting a new home is to buy the land you want (even if it already has an established home on it) and then completely custom-build your property (if there’s already a home on it you can knock it down and rebuild). However, do note that this is likely to be more expensive than purchasing a house-and-land package or an established home. Rather than getting all the costs bundled into a single amount, you’ll need to pay for the architect/designer, building team, insurances, soil tests and more – all while balancing a budget to ensure costs don’t get blown out with delays or material issues.
New or established, you’ll find a dream home in Toowoomba
There are plenty of options at your disposal, which is why a property expert can make finding your new home so much easier. If you’re ready to buy your dream property in Toowoomba, contact an experienced local agent today.