Buying a first home may be a decision put on hold during the Covid-19 lockdown, but it does give you time to do a little homework over the pros and cons of buying a new house versus an existing property.
Talk to the experts and it's clear there is no "right or wrong" decision, but there may well be one option that works better for you.
LOOKING FOR A 'DO-UP'
Many young people like the idea of being able to add value to their first home through renovation.
Alice and Caleb Pearson, who won The Block NZ in 2013, are serial renovators who have just finished their 10th house. They started with their first home, a four-bedroom 1950s ex state house in Panmure, Auckland in 2010.
Caleb Pearson says he knew nothing about renovating so it was a baptism by fire. "I had no skills and no idea what I was doing, although I enjoyed it. We had a working bee with a few friends to do some demolition work, and Alice laughed because all I did was tidy up after people with a broom and dustpan."
Pearson says people buying a "do-up" need to be prepared to put in a lot of time and hard work.
"Our first renovation was very basic and simple. We saw it as a good way to put in some sweat equity and add some value. We only spent about $15,000 and did as much of the work as we could ourselves. Alice's father taught me a lot of handy, practical skills.
"We have no regrets at all. In fact, we still own it and have it tenanted. When we moved in back in 2010 we had another couple as boarders for about two years to help pay the mortgage."
Pearson says he is aware there is a tendency for "do-ups" to sell for a premium. "Friends of ours were looking at one such property and costed it out. It turned out they were better off just buying an already completed house."
Craig Lowe of Lowe & Co Realty in Wellington agrees. He believes the rise in popularity of renovation shows such as The Block NZ has created a demand for "do-ups". Consequently, the price of such houses tends to be much higher than it should be when compared with properties that have been renovated
"It's really a cultural thing – our national pastime is investing in real estate and doing up houses. There's also that desire to make money quickly by flipping or renovating for gain."