Investment blog - Savvy property investors know the answer
One of the decisions you’ll need to make as a property investor is whether to invest in new build or existing properties. Investors who are committed to older properties extol several advantages of doing so, including:
- You don’t pay the builder’s profit margin in the price
- Opportunities for renovations and refurbishment are opportunities to add value
- You have historical data which eases price discovery and confirmation of value
- Well selected existing properties are less likely to fall in price in a market downturn
While the above may be true, all of these advantages are centred on the potential for capital growth. The arguments in favour of older, established properties rely on the same fundamentals for capital growth as new builds. If you buy an existing property in an undesirable area, it is likely to perform worse than a new build in a sought-after location.
What about the choice between new build and existing as a long-term investment for rental income?
In this post, I’ll examine five undoubted advantages of new build over existing for the buy-to-let investor.