As with any purchase you would make, when you’re buying a brand new home, you need to make sure it’s a financially sound decision you’re taking. While you might see it as your home, what you have to keep in mind is that it’s also a major financial commitment to get into as well as an investment decision which requires careful consideration.
In this post we’re taking a look at some of the essential consideration pointers associated with buying a brand new home.
Low initial maintenance costs
Everything that comes with a new building will be new itself, including the heating, plumbing, carpets, kitchen units, etc. As a result you won’t have to spend any money on upgrades and repairs.
Lower energy bills
A new building today is built to meet current standards in energy efficiency, which feature improved insulation and double glazing, and boiler efficiency. This increased energy efficiency can result in savings on your energy bills, which also means you could have additional disposable cash or savings.
Even though most new-build properties come with a 10-year National House Building Council (NHBC) warranty or other insurance-backed guarantee, unless you highlight any specific issue, it will be missed and you won’t be able to make your claim at the conclusion of the warranty period. A New Home Snagging Report is one of the best ways to make sure the house has been built according to good standards.
The prestige associated with newly-built homes brings with it higher prices as a result of aspects such as builder incentives and inflated prices on fixtures and fittings, which equates to larger mortgages and interest.
Possible initial drop in value
You may need to sell during the construction phase or close to the next phase release, in which case there would be lots of houses for sale, accounting for a buyers’ market which sees them with many choices. As a result, it might not be possible to recoup the purchase price.
The timing of your move-in date
The move-in date given by your builder is typically something to be cautious of as it’s only a provisional date. This means that you have to take into account your current living arrangements and what plans you’ll have should you not be able to move in on the planned date.
Land ownership – Freehold vs. leasehold
Unlike the case with freehold land ownership (where you own the land), with leasehold land ownership you don’t own the land, but you have to rent it on an annual basis in addition to paying ground rent. More builders have been selling houses on leasehold than freehold in recent years.
Living on a construction site
Living on a construction site that can be very dusty, noisy and dangerous for children is one of the many positive and negative stories about new-builds shared in the Moving and Improving community, with surrounding homes making for another possibility as far as it goes with that example, since they could be under construction for months and maybe even years after you move in.