Build or buy existing?

[Jayro]

Hi all,

Just after some advice from those on here in the know.

Looks as though we have just sold one of our properties. We will walk away now with a $100k deposit for our new PPOR. We are looking at either summerland point or Gwandalan. Both suburbs are on NSW lake macquarie. There is a new subdivision in each that we like.

Im just not sure wether to build or buy existing property. Basically to buy a place in the new estate like what we would build will have a purchase price of $370k-$380k. plus stamp duty etc. These are homes 2-6yrs old basically.

OR we build. Something my wife and I have always said is a "to do before we die" We can get the land we want for $150k then the houses we like start from $145k, this price is complete with floor coverings, kitchen appliances 2 coates paint etc. Obviously we will want a few upgrades such as bench tops, different facade etc etc plus there is then driveways, a/c, stamp duty etc etc.

I think both options will come out with a similar end figure. Would you agree???

Also if we build do we only pay stamp duty on the land value or ????

Anyhow appreciate any advice and constructive input.

Cheers Jas!

 

[prandsa]

There would have to be a lot of upgrades to get an extra 75k!! Plus as you say, there would be the stamp duty saving by buying the land first.
Good luck with whichever you choose!

 

[sparky23]

Make sure your site costs have also been factored in and be sure to buy a flat block to keep those site costs down as they may be anything upwards of $25,000. Also check the Basix costs which could be another $10,000, you should still come out in front by building especially as it looks as though the doomsayers 40%-50% house price falls won't be happening any time soon.

 

[Jayro]

ok, at the risk of sounding stupid. What are Basix costs??

We are heading to a few display homes today to get a better idea of exact costs by changing to a better facade etc etc and will sit down tonight and do some calcs.

cheers Jas!

 

[Propertunity]

Jayro,

google "basix requirements"

Its all about energy saving, water catching, insulation, greenie stuff that is now embeded in legislation for new home builds.

 

[Jayro]

yeh thanks for that. I just had a look and was interesting reading. I would have thought that with it being legislation that the builders would have had to include it but obviously not.

All good. Id rather know this now, more questions I ask when I speak with the builders wont make me look so "novice" lol.

Thanks for the replies so far

Cheers Jas!

 

[sparky23]

Let us know which builders you are thinking of using as we may have feedback for you.

Good Luck!

 

[darcykeene]

Yes, both would come out with similar end figure. There mightn't be a drastic difference between them. But i would like to suggest you to build, because it gives some choice to construct according to your taste and requirement as well. Good luck to you in whatever you choose.

 

[Jayro]

Well checked out a few builders. Again we keep coming back to Coral Homes. They are one of only a few that do offer fixed price contract including site costs. We really like there end product and there designs. Also there prices are reasonable as well. Checked out a few others such as allworth, beechwood (new owners) masterton etc.

Anyone have any dealings with Coral homes?

I must admit the build time threw me a little. 3.5months to get through council then 6 months build time.

Cheers Jas!

 

[sparky23]

Well checked out a few builders. Again we keep coming back to Coral Homes. They are one of only a few that do offer fixed price contract including site costs. We really like there end product and there designs. Also there prices are reasonable as well. Checked out a few others such as allworth, beechwood (new owners) masterton etc.

Anyone have any dealings with Coral homes?

I must admit the build time threw me a little. 3.5months to get through council then 6 months build time.

Cheers Jas!

Sounds about right, maybe a bit longer just depends on which council it is with. I haven't come across that builder down here, how much house can you get for what sort of dollars?

Check out Eagle homes aswell, I have used them a couple of times and the pricing isn't bad. Our time frames blew out a fair bit but we were doing sub-divisions and duplex builds so a straight forward single house build should be ok. The end results were ok too.

 

[WinstonWolfe]

Jay, you aren't really comparing apples here.

You are comparing a 320k with a 380k house.
If you buy, you'd presumably be buying a better home than you build.

Anyway, I ran some rough figures through a construction spreadsheet I use and you are better off buying the 380k place by 5k after 10mths.

Building is more expensive because you will pay 10 mths rent or interest elsewhere, while also paying interest on the land and construction progress pmts.

However, if your mortgage is 60k lower on the build, you would eventually end up better off because your mthly interest pmts are lower.

Keep in mind building comes with more risk - council delays, lender screwing you around on progress pmts, bad weather, poor communication with builder, builder going broke, poor workmanship.

 

[yorke]

I must admit the build time threw me a little. 3.5months to get through council then 6 months build time.

6 months including concrete slab is good, AVJennings has a 6 months guarantee but that's from the time the slab is down. If they sign up too many FHBs you'll be lucky to see the keys in 12 months, (during the last building boom in Perth 24 months was not unusual ) so see if they can agree to pay your rent if they are late. Also check out the small print for price increases due to unforeseen circumstances beyond their control.

 

[J Martin]

Well checked out a few builders. Again we keep coming back to Coral Homes. They are one of only a few that do offer fixed price contract including site costs. We really like there end product and there designs. Also there prices are reasonable as well. Checked out a few others such as allworth, beechwood (new owners) masterton etc.

Anyone have any dealings with Coral homes?

I must admit the build time threw me a little. 3.5months to get through council then 6 months build time.

Cheers Jas!

New state gov rules mean that it will take no more than 10 days to get through council. From my understanding a new home would now come under complying development. Check out the lakemac website for more details.

It's only very recent development, but the building companies would know about it.

 

[Jayro]

Thanks for the all the replies. Appreciate the info. Winston thay are similar type homes. All around the 23-24sq. 4bed, double garage, 2 bath etc. Obviously the $380k house has drives, entertainment areas etc the $320k house still requires these.

To be honest I like the idea of a simple sell here, buy there and move in. The idea of renting for up to 12 months doesnt appeal to me. Anyhow will check out the local REA over the weekend and geta feel for what on offer in our price range.

Cheers Jas!

 

[WinstonWolfe]

Thanks for the all the replies. Appreciate the info. Winston thay are similar type homes. All around the 23-24sq. 4bed, double garage, 2 bath etc. Obviously the $380k house has drives, entertainment areas etc the $320k house still requires these.

Cheers Jas!

imho, an 80k premium for a few internal extras, drives, fences, 10k of landscaping, and a pergola is over the top.

In this market, I'd be leaning towards making lowball offers on a nicely presented existing home.