S3 E6 The fears of building new Pt.2: The reasons why it makes sense to build new.

The second part of this series is all about the reasons why it makes financial sense to build a new property, rather than buying established.

Cam introduces a foundational point: If you think about 2 properties, one new and one looking tired, the newer one will rent faster and for more each week.

Cam and Matt discuss the following points:

• Repairs and maintenance - buying existing can cost thousands in hidden issues i.e painting over cracks to hide foundation issues
• Like new cars, new homes still require maintenance, but there are less risks of hidden major issues.
• If you are an owner builder, and spend more than $15k on renovations, you can be liable for for any repairs or structural issues for 7 years.  The 'do-er-up-erer' can send you broke if your held liable for all the works.
• When you buy new, there is much less stamp duty.  It is only payable on the land, which is typically half the cost of buying established.
• Deprecation schedules are a huge advantage for investors, as they can reduce the payable tax on income.  This all adds up to reduce holding costs.

Matt describes how with current market conditions, you can secure land for the cost of a deposit.  You don't have to settle on it until the developer has finished producing it.  Its possible to generate great equity in the meantime.  Some OpenCorp clients are making over $50,000 just while the land settles.

This is a really enlightening episode for aspiring property investors figuring out that important question:  New or established.