Moving into a new home is a great feeling but it doesn’t actually match the feeling of building your own home.
There are obvious benefits to designing and building your own home, you’re in control of the layout of your home, allowing you to make something that suits you and your lifestyle perfectly. You can also choose the location, within reason and budget, and you will know the exact placement of all electrics and plumbing.
Not to mention that you shouldn’t need to do any repairs or renovations for a long time.
But, is it actually cheaper to build a home than to purchase one?
The simple answer is yes. The actual cost of building your own home is estimated to be 30% cheaper than buying a pre-constructed one. Alongside that, you’ll get the benefits mentioned above.
But, there are things that you need to be aware of when building your own home.
Firstly, you still need finance and this can’t be established through the traditional mortgage firms. You’ll need to get development finance partners, these firms agree the number of funds you can borrow and release the funds in stages, allowing you to pay for the building process in stages.
But, in the end, when your house is complete, you’ll need to repay the construction finance. For that, you’ll need to have a traditional mortgage. Consider the value of your finished house when looking at finances. Just because your home has an array of innovative and unique features doesn’t mean it will be worth more.
Of course, the size of the home you’re building must be compared to a similar-sized pre-built home.
Stamp duty, legal fees, and perhaps even a few finishing costs will not be included in your original budget. You’ll need to be aware of these before you start to ensure the cost of the build is acceptable.
However, it is worth noting that there are some grants available if you’re constructing your own home, these can make a significant difference to the cost of your project and should be looked into a local level. The amount of the grant and availability varies depending on where you live.
It’s also worth noting that while buying is significantly cheaper in most cases, this is not always the case. Perth is a good example of where it may actually be cheaper to purchase a house than to build one. This is because the cost of real estate in Perth is comparatively cheap.
The real secret is to evaluate all the costs of building your own home, from start to moving in, and then compare the overall cost with the cost of buying.
But, if there is little difference in the costs, you’ll also want to consider that you’re more likely to stay in a home that you’ve designed yourself and fits your lifestyle than you are in a standard construction. This could swing the balance in favor of building a house, even if it costs more than buying one.