Are new builds worth the money? Is it a good investment? A question many have been considering of late, as we've noticed over recent months a surge of investors purchasing new builds as investment properties.
Loans for new builds, by investors and owner-occupiers alike, are only required to provide a 20% deposit. A helpful boast for people looking to invest for the first-time, and for current investors looking to expand their portfolio.
Tax Deductible Interest
This year the government announced landlords will no longer be able to deduct off their tax bill the cost of interest from their mortgage. Fortunately new builds have received a 20-year exemption to this new tax rule. Along side this, the 20-year period applies to the property not the owner, meaning if the property is sold during that initial 20-year period, the tax exemption transfers to the new owner for the remainder of the 20-year period.
Healthy Homes Standards
New builds are likely to already pass the Healthy Homes Standards for heating, insulation, ventilation, moisture ingress, drainage, and draught-stopping, though it is down to the developer to add features, like heating, that are not required by building regulations.
Unless the property has been re-modelled recently, older properties tend to require more regular maintenance, which can quickly turn a property into a black hole for your money if you’re not careful. New builds have the advantage of being just that - new! New fittings, new carpets, new paint, new whiteware, the list goes on. Meaning you can invest with the knowledge the property is unlikely to require much maintenance for years to come.
Tenant Demand & Rent
A new build is attractive. It's new, stylish and modern. There's very little not to like, especially from a tenant's perspective. Young professionals in particular desire new builds, who see the pay-off of paying higher rent for a new modern property. People also tend to like renting new builds, as it usually has double-glazed windows, and are generally warmer, healthier homes than an older property. Condensation and mould are also less of an issue in new builds, which is very attractive to tenants and owners alike.
Ultimately new build investments provide great opportunities to help grow your property
portfolio. You only need a 20% deposit, and will receive tax benefits, great tenant demand, and reassurance your property is unlikely to need maintenance for some time.
If you're looking for more advice on investing, or are looking for a complimentary rental appraisal on a property you're considering, feel free to give us a call.
Locally owned and managed, we take care of investments, offering peace of mind and a personal service to investors and tenants alike. With 30+ years experience in residential property management services, our solutions are backed by industry-leading technology and proven systems that promote both excellent property care and strong investment returns.
Taking on all aspects of the landlord’s role, we guide our clients with professional, tailored advice using our extensive experience and insight in the rental market that can only be built over time.
If you would like to chat about the possibility of working together, or to receive a no-obligation, FREE Rental Appraisal get in touch with our team today. Quinovic Johnsonville | Wellington Call Jordan Atkinson - 027 297 0873
Quinovic Hutt Valley | Wellington Call Helen Vance - 027 487 8103 Quinovic Kent Terrace | Wellington Call Jordan Atkinson - 027 297 0873 Quinovic Wellington Property Management