Debate about whether it’s better to buy a new home or an established property is as old as the real estate sector itself.
New homes have an inherent value because they should have fewer maintenance costs and challenges, although that’s not always the case. They should also benefit from modern design and convenience.
With older properties, the layout is often dated and bitsy. And these homes definitely weren’t built with the NBN in mind.
But at least with an established property you can move in straight away.
And so long as the building inspector did their job, you should know what you’ve purchased. Additionally, you don’t have to go through the stress of watching your home being constructed and worry about cost blow-outs.
The mood of Australians towards building new homes has changed since Covid. Rising costs and the regular drumbeat of builders going out of business – often leaving customers and suppliers in limbo – has made many fearful of buying a new home.
A new survey suggests nine out of 10 Australians actually distrust the building industry.
Some 90% say builders will cut corners to save money, and a similar number (89%) believe they will make compromises simply to deliver a home faster.
The survey, conducted by Equifax, couldn’t come at a worse time for the building industry.
It’s beset with problems such as insolvencies, and it’s in the spotlight to meet the Government’s failing housing target of 1.2 million homes in the period 2024-2029.
In the first 12 months, it fell 27% short (66,000 homes) of its annualised target.
The latest data from the Australian Bureau of Statistics shows housing approvals in July fell 8.2% to 15,769. The biggest fall year-on-year was in NSW where approvals dropped -24.6%.
The Equifax research finds 78% of Australians are concerned about construction insolvencies. Some 51% say they have little or no confidence in the quality and long-term durability of newly-built apartments or build-to-rent developments.
More than half (53%) say legal protection to safeguard consumers is insufficient.
Right now, the Federal Government is trying to see how it can modify the National Construction Code (NCC) to cut red tape that slows down the building approval process.
At the same time, it claims to want to improve safety and quality. At a surface level, these two goals seem somewhat opposed to each other.