Buying Old VS New Property – When purchasing any commodity, new is frequently preferable to used.
However, in the housing market, your best opportunity may come from an older home, or, as in Brampton, where the inventory of new homes is overstocked, you may be able to purchase a new home for the same price that buyers paid years ago – Buying Old VS New Property
Here are some of the advantages and disadvantages of both options.
Advantages of Buying Old Properties
- you can physically walk through and inspect the home
- similar listings have sold or are currently available to use for comparative market analysis when establishing price
- antique homes appeal to a large group buyers, renters and investors
- builders and developers can try to maximize land value by subdividing
- investors can renovate the property to increase profitability
- do-it-yourself enthusiasts can invest sweat equity to reduce repair or upgrade costs
Risks and Concerns of Buying Old Properties
- Existing properties may have structural or mechanical issues, so check the age of major components and hire a building inspector to uncover hidden issues.
- A building inspection will aid in negotiations if you require repairs or upgrades.
- Title easements or caveats may have an impact on your plans for the property.
- To ensure a smooth closing, double-check title ownership and vendor warranties.
- you are renovating or subdividing, make sure your plans are in accordance with zoning regulations.
- During negotiations or auctions, competing, emotional buyers can drive up property prices.
Advantages of Buying New Properties
- They use cutting-edge technology and adhere to the Ontario Building Code.
- You can select your own finishes rather than inheriting someone else’s.
- A warranty is provided with new homes.
- In general, new properties require less maintenance.
- Low energy ratings make them less expensive, lowering ongoing operating costs.
- Financing may be simpler because builders frequently arrange mortgages as part of the sale.
- Tax depreciation benefits may reduce the property’s holding costs for investors.
Risks and Concerns of Buying New Properties
- There is a risk of construction delays and cost overruns, which will increase the price.
- You must pay HST/GST on a new home, which raises your costs.
- There is little, if any, infrastructure in a new subdivision.
- Similar properties in the same area may have a slow increase in value.
- Apartments in a newly zoned area may be in short supply and difficult to rent.
- Be wary of growth corridors because you may have to wait a long time for profits.
- Select developers with care and conduct background checks on all associated parties.
CLICK THE IMAGE BELOW TO WATCH THE VIDEO