Determining Price: Land Size vs House Age

I am slightly confused about the price of properties on the market in western Sydney where my partner and I are looking to by our first home. Here are the factors I am having issues with:

1. Are newer built houses worth more than older ones even if the older ones have been renovated (eg 7 year old house vs 30 year old renovated house) and if so will they always be worth more - i.e. say in 50 years time, one house is 57 years old and the other 80 years old, will they be worth similar or does it depend on how they have been maintained?

2. Land size. Taking the above into consideration, I have seen newer houses (5-10 years old) on blocks of approximately 400sq m, and nicely renovated older houses (20-30 years old) in the same area on blocks of 800sq m - 1000sq m for sale at about the same price. Which of these options would be better for capital growth as we would be looking to rent out this property after a few years and purchase another one?
 
I am slightly confused about the price of properties on the market in western Sydney where my partner and I are looking to by our first home. Here are the factors I am having issues with:

1. Are newer built houses worth more than older ones even if the older ones have been renovated (eg 7 year old house vs 30 year old renovated house) and if so will they always be worth more - i.e. say in 50 years time, one house is 57 years old and the other 80 years old, will they be worth similar or does it depend on how they have been maintained?
IMO, the age itself has very little to do with the appeal of the house. eg. compare an art deco place with a "typical" 70s build with orange brick. Maintenance is key and some of the older places with unique features will always have higher demand.
2. Land size. Taking the above into consideration, I have seen newer houses (5-10 years old) on blocks of approximately 400sq m, and nicely renovated older houses (20-30 years old) in the same area on blocks of 800sq m - 1000sq m for sale at about the same price. Which of these options would be better for capital growth as we would be looking to rent out this property after a few years and purchase another one?
If it was me, I'd go for the bigger land. As blocks become smaller, your one block could become 2.
 
2. Land size. Taking the above into consideration, I have seen newer houses (5-10 years old) on blocks of approximately 400sq m, and nicely renovated older houses (20-30 years old) in the same area on blocks of 800sq m - 1000sq m for sale at about the same price. Which of these options would be better for capital growth as we would be looking to rent out this property after a few years and purchase another one?

I would choose the latter!

When in doubt, land size takes priority esp where CG is concerned

One situation where you may want to choose a newer house on a small land as an IP is if the property is brand new so you can claim 2.5% of hte purchase cost every year for 40 years as a deduction (which is essentially 'free' money from the ATO). You need to work out your numbers eg: how much you will get over 40 years ..........

Though personally even then, I'd still generally pick the older structurally sound house with more land.
 
Thanks for your comments guys. Yes, we are thinking to choose the latter.

At the moment we are choosing between a 3 bedroom house on approx 420 square metres and a 4 bedroom on approx 650 square metres.

The 3 bedder is much newer and we think we may be paying a premium for that, when in 20-30 years it will be an just the same as other houses in the area probably, in terms of how it is valued. The 3 bedder is less than 10 years old where as the 4 bedder is 20 years old. Over time we are thinking the bigger land size will be beneficial to us.
 
Just a quick question gw83, if I may? On the face of it, this looks like a racist question but I assure you, it is not. :)

Are you of Indian background?

Now for the explantion: Many of out Indian clients come from a real estate background in their home country, where the price you pay for RE is on a per m2 basis. So a block of land of say 600m2 will sell for twice as much as a 300m2 block.

Whereas, in Australia there is no such convention in the resi market. There will be a discount (perhaps) for a smaller block in the same location but it will not be a 50% discount (over a 600m2 one in the example given).
 
Land

I am slightly confused about the price of properties on the market in western Sydney..................2. Land size. Taking the above into consideration, I have seen newer houses (5-10 years old) on blocks of approximately 400sq m, and nicely renovated older houses (20-30 years old) in the same area on blocks of 800sq m - 1000sq m for sale at about the same price. Which of these options would be better for capital growth as we would be looking to rent out this property after a few years and purchase another one?

I'm for more land all other factors being equal.

As long as that land is situated in an area where they cannot manufacture any more. ;)

So if it is on the outskirts of western sydney, beware of the ability to create new estates adjacent to where you are buying as you have less hedge than if it is in the middle to outer rim (but not the extreme outskirts).

If it is inner western Sydney, then go for as much land as your pockets allow. :D Check with council in that are what the land use is suited for at present. Duplex zoned or higher density zoned blocks are preferred however, sought after by others hence pushing the initial purchase price (to you) up.

Good luck :)
 
Thanks for your replies, very interesting, I'm not Indian by the way :)

There's not a lot of new land being sold where we are looking so we think that more land will be the way to go.

Cheers,

Grant
 
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