When buying a house, there’s a lot of big decisions to be made. One you might be wondering is, should I buy a new build or an old house? Here’s a few pros and cons you need to know.
Costs and government schemes
If you’re a first-time buyer, the government has various schemesdesigned for those buying a new build. For example, theEquity Loan Scheme requires buyers to pay only a 5% deposit. So if you have a limited budget or can’t save as much of a deposit, then a new build may be the way to go. This Equity Loan Scheme comes to a close on the 31st of March this year, however a new Equity Loan Scheme will replace this which starts in April 2021. The new scheme is available to first-time buyers only.
If you need a mortgage for an older property, most lenders ask for a minimum of 10%, but due to the pandemic most lenders are looking for around 15%.
One thing to consider is whether you’re planning on reselling in a few years, or you’re staying long term. New homesoften depreciate in value straight away, just like a new car. If you plan to stay in the house for a long time, then you won’t need to worry. However,if the plan is to resell for a profit in the future, then an older houseis likely to be a better valueoption.
However long you plan to stay there are always ways to try and add more equity to your property.
Discounts and offers
You may be able to get a discount on a new build if you buy off-plan. This means if you buy before the house is finished, or even before it’s started. If you buy off-plan, seek advice and make sure you’re protected as it can be risky if the build never completes. Developers might try to entice you with offers of upgraded fixtures and fittings. Make sure what they’re offering you is worth it, and that you couldn’t buy the same carpet, or door fittings cheaper elsewhere. You’re unlikely to receive incentives when buying an old property.
The types of offers are only available with new builds so if you’ve got a tight budget and want to save where possible then this may be the better choice.
Is your move urgent?
Buying a new build property often involves some waiting. Unless the property is already built you’ll need to factor in build times and allow for unforeseen delays. You could be waiting a while to move into a new build. With old properties, it’s possible to complete within three to four months. But you have to consider time for surveys and the strength of the chain. If you’re a first time buyer and don’t have anything to sell, this could help you move quicker but there's still a chance you could face delays.
Older properties tend to need more work doing to them. They could have wooden window and door frames that require regular upkeep. You might need to upgrade the insulation or the heating system to make it more economical to heat. New builds tend to be cheaper to maintain and cheaper to run. They’ll also come with a guarantee such as the 10-year NHBC guarantee, though you’ll need to be aware of what is and isn’t covered.
Character and design
One of the big differences between new builds and older properties is the character, or lack of it. New builds are often much blanderin comparison to an old house. Estates packed with houses that all look the same might not appeal to you. But some people prefer the clean lines and easier upkeep of new builds.
An older property might have period features and quirks that make it appealing should you come to sell it, which will often always have desire and give your home value. This is simply a matter of personal preference.
What it comes down to...
Ultimately, your budget and personal taste will guide you when making your property purchase. While it can be more affordable to get a new build as a first-time buyer, don’t forget to factor in any future plans you may have, which could affect your decision.