We are planning to move to NZ soon and there is one question stuck in my mind.
What is cheaper, to buy a house which has already been built or to build a new one by hiring a contractor/builder? (considering all circumstances the same i.e. no of rooms, area, design/architecture etc.)
I did some research about this on the internet and I found that:
1. To answer this question correctly, we need to know the town where we want to buy/build a house, the market rates, labour costs in that town etc. The cost of building a house varies significantly according to the proximity/availability of resources and people.
2. Building a new house usually means more paperwork and you have to wait for it to be built
3. You really need to trust the builders making the house (especially because I am not from a construction background)
So what is your personal opinion about it?
After giving a thought about it myself, I came to the following conclusion:
How can something, which is older cost a lot more than something (similar) which is being newly built?
Even if the cost of building a new house is higher (labour, material costs increase over time, markets fluctuate), the seller of an existing house would still give his/her house away at the current market price. The value of the existing house would have increased anyway over the years. Also, I don't think any normal seller would sell his/her house at a cost which is lower than what was required to build it. Hence, I end up paying the cost of the building the existing house (built a few years ago) + whatever the seller wants to earn as a profit by selling the house. Could this cost still be a lot lower than the cost involved in building a new one?
Again, I have no background of construction and have no experience in owning any house, so my questions, thoughts might sound irrational.