In life, it is more often cheaper to make things on your own, than it is to buy things ready-made. However, this is not always the best course of action and can vary depending on what product is being sought after. For instance, when it comes to moving into a new home, the question is whether or not you are better off, financially speaking, to buy yourself a brand new, ready made property, or to seek ways in which to build your very own house.
Whether you are looking to find custom builders or planning on doing the job yourself. Here are some tips to bear in mind when making the final decision between the two.
Straight Up Costs
If you are looking purely at direct costs, for the same property type and the same location, the national average suggests that it is around $90,000 cheaper to buy a property than to build your own. The reason for this is very simple, and that is because most real estate companies build in bulk, meaning they buy materials in bulk and given that they are asking less from the construction firm than a custom builder, they pay less for that too. But keep in mind this is not always true, for example in Sydney this is one place where it is actually cheaper to build, owing to the highly priced stamp duty.
While the straight up costs are important, this metric focuses purely on the dollar value of what is involved in buying or building a property. There is of course much more to buying a new place in terms of value, beyond the dollar cost. For example there is time to consider, which is an important aspect with any house decision. The time involved with searching for and buying a newly built properly is far less than if you were to go through the design and build process with architects and custom home builders. The value of your time will also depend on what timeline you have available. For example, if you have to be in the property for a new job position in 6 months time then every second counts. But on the other hand if you are in no rush then your time is less costly and a custom build could work better.
Make no mistake, there is an enormous amount of stress and worry involved with designing and building your own home. When compared with buying something ‘off the shelf’ there is no doubt that you will invest more emotionally into a build. On the flip side of this however, is the joy which you will have in living inside a property which was created and designed just for you and your family, and for many people that far outweighs the strain of going through a custom build.
The key takeaway here is that there are a number of valuations & costs to take into consideration when weighing up this decision. Beyond dollar cost there is time and emotions to account for, which is why there is no set answer as to which is the cheapest choice to make and it will boil down to personal preference.