APIA Blog

RSS Feed

Raewyn Stanaway: Residential property investing - new builds vs existing

Friday, October 23, 2020

 

There are lots of options available when looking to invest in residential property and one consideration is whether to buy an existing property or a ‘new build’.

With the current RTA and Healthy Homes legislation, there is indeed a lot to think about.

Existing Homes

Unless you are buying an existing house that is already 100% compliant with current legislation, or wish to do any work required yourself, you should be prepared to spend some time and money to ensure an existing home is completely compliant for rental purposes.

Having a Healthy Homes check done as part of your due diligence when buying an existing property is important. Does the property meet the current and impending Healthy Homes Standards? This includes insulation, heating, draught stopping, ventilation, moisture ingress and drainage. If not, have you allowed for the costs to make the home compliant?

Can the property be legally rented? Is the property a legal dwelling that meets current building codes? This includes any extensions, alterations, decks, granny flats and sleep outs.

Are there likely to be any major upcoming maintenance or expenses over the next few years For example, how old is the hot water cylinder? Will the house need rewiring or new plumbing? Is the roof and/or guttering likely to need repairs or replacement? Will the kitchen or bathroom need work? Does the exterior need painting? Are the floor coverings wearing out? Are the grounds in good condition and easy for tenants to keep maintained?

Is the property going to attract good quality tenants? The best properties get the best long term tenants and the best rents!

New Homes

New properties should be compliant with current building codes and will meet the Healthy Homes standards apart from perhaps heating in the living room.

New homes will have minimal maintenance for many years and you will have warranties for workmanship, fixtures and fittings, and any appliances installed.

You may have to invest in some easy care landscaping, tree planting etc to attract good long-term tenants and add value to your investment, but generally, a new build should be relatively low maintenance for many years.

In summary, you will need to weigh up the potential return on your investment either way, but making sure you have planned for any immediate compliance costs and/or upcoming maintenance needs to be taken into consideration.

Please feel free to contact me if you have any questions or if you would like some information about our professional property management services.  I am always happy to have a chat! You can reach me at r.stanaway@barfoot.co.nz or call 0274319471. 


ABOUT THE AUTHOR

Raewyn Stanaway

Raewyn leads the Property Manager Team at Barfoot & Thompson Grey Lynn. Her extensive background in corporate management along with running her own businesses has made her the perfect candidate for the role. She has a strong focus on customer service and believes that communication is key to building long term relationships.


 

 

 

 

 


Recent Posts


Tags

Holler ird scotney williams productivity capital gain watercare anz covid-19 letting smoke alarm holiday house Market report shower dome Investment tip meth Case study early termination rental wof recycling equity warren buffett subdivision housing affordability financial advisers act kiwibuild sublease warm up new zealand relationship investor landlord opes partners commerce commission principal and interest bond form HSWA clnz government property management quiet enjoyment Guest blog rent increase Kris Pedersen Mortgages and Insurance apia buying rules data security trust property value damage business Tribunal case study advice short-term rental inspection auckland council heat pump unitary plan airbnb structure Property (Relationships) Act auckland Gluckman yield cat Standards New Zealand property maintenance Jeff Bezos re agent CCC ring-fencing tenant Editor's Choice LIM housing package investment strategy skill shortage cgt maintenance property cycle retaliatory notice Zodiak Management rta reform twg report positive cash flow ask an expert Level 4 parry v inglis khh bankruptcy banking HHGA asbestos finance rta off the plan partners CoreLogic fixed-term tenancy anti-social behaviour election2020 debt to income p lab Question and answer ocr termination travel bubble mortgage beginner investor rtaa2020 lvr worksafe insulation boarding house reserve bank short term rental extractor fan negotiation return meth contamination trespass market rent Landlording property apprentice RBNZ bad tenant rent heating tax legal tenancy issues How to buying Q&A personal growth interest limitation management gluckman report house prices initio education wealth creation heater sale and purchas wins rent arrears television winz interest rates nzpif election 2017 building daikin ventilation legal cost speculator letting fee RTAA 2019 shortland chartered accountants market trademe TCIT buyer's agent sale and purchase tenancy tribunal rental market privacy Investor story HHS will minor dwelling rent control housing bubble barfoot and thompson insurance water bill interest only mindset Must knows bond income first home buying debt enforcement property robert kiyosaki tenancy services brightline Must know renovation equity interest deductibility cash-flow development DTI Sponsored post

Archive

Introducing Our Partners
Principal Sponsor - Kris Pedersen Mortgages & Insurance logo Gold Sponsor - Barfoot & Thompson logo Gold Sponsor - CoreLogic logo Property Apprentice logo The Insulation Warehouse logo The Renovation Team logo The New Zealand Property Investors' Federation logo