Is it better to buy or build a home?

May 20, 2021

With the recent rush of building activity in New Zealand, many people are now asking, is it best to build or to buy? Building and buying both have their advantages and most often the personal preference wins, however in the current market choice can be limited.

Building consent numbers are back levels not seen since the 1970’s, with much of that development centering around the main cities of Auckland, Tauranga, Hamilton, Wellington, Christchurch and Queeenstown. Both building and buying have positive and negative aspects to them, ultimately its a preference and compromise decision. 

Is it better to buy or build a home? 

Firstly, one important distinction when thinking about new builds is that you have two different options. Built to order vs built by a developer. 

Built to order means that you might buy a section then commission  builder or development company to build to your specifications. Buying a new build that has been completely managed by a developer could mean that you have little input as to the way the house is built, the developer will simply build the home they think will do best on the market. 

What are the benefits of building a home?

Better lending and government support

If you are building a home, banks will be less restricted on the amount they can lend, or the loan to value restrictions. It's not uncommon for banks to advertise a 10% deposit requirement for new builds. 

The other aspect for first home buyers is that the NZ government's first home buyers grant of a maximum of $5,000 is extended to $10,000 for a new build. This can go a long way especially if there is more than one purchaser. 

Move-in ready

When purchasing a new build off a developer, the home will be move-in ready. You can expect there to be no renovation or insulation requirements before feeling comfortable in your new place. This is a big benefit over buying a home where you never truly know what work is required.


You can get exactly what you want when you build your own home. Many who decide to go down this route, do it exactly for this reason. It can be tough to find what you want on the market and could spend years searching for the home that ticks all the boxes. For some, building is actually a shortcut to get into the home they really want. Keep in mind though, the amount of planning needed to build it is immense, you need to pick out, paint colors, kitchens, bathrooms, flooring, cabinets, carpets, curtains… the list goes on. This can be stressful and overwhelming. 

Less on going maintenance

Because everything in a new build is up to spec and brand new, you should expect there to be little to no maintenance needed for the first few years. If anything does need fixing, most appliances and work should be covered under warranty. When buying an existing home, you often don't know the extent of any work required until you have lived in it for a year or so. Once you have spent a winter and summer in the home, then you might understand the extent of any maintenance or improvements work required. 

A healthy home

With modern building techniques, buying a new build means that you can expect a warm healthy home. Modern building codes mean things like insulation, ventilation and double glazing is mandatory. This can not be said with older homes where single glazing and some insulation might be installed. In addition, all this can lead to lower heating and energy costs. Even if these savings are not huge per month, the savings over the time you live in the house can be significant. 

What are the disadvantages of building a home?

Quality of building materials

The quality of new homes has been in the spotlight recently . People planning on building a home or buying a newly constructed home should do due diligence on the products being used as well as the company (rate and review builders here) and builders doing the construction. Older homes tend to be made out of higher quality materials. Of course if a home has been standing for 30, 50, 80 years, the quality of the product has already been tested and you can be pretty confident that it will last the time you require it and beyond. 

The time it takes to build

You could be looking at a 6-10 month time lag between purchasing land, signing agreements to build and then moving into your new house. Consider if you have a place to live in this time. If you need to rent or move in with friends or family, this additional cost should be factored into your decision making process.  

What are the benefits of buying an existing home?

With building you can experience delays

If you are commissioning a home to be built, it's not uncommon to experience delays. These could be due to issues out of your control like weather or supply shortages. As we know there is a large increase in the amount of homes being built, with this comes strain on developers and builders. In recent years we have seen a number of high profile developments and developers file for bankruptcy. 

Many more location options are available

When you build a home, finding a flat section available often means living out of town and further away from the city. New subdivisions are almost always a drive away from the city and public transport options can be limited for years to come. Buying an existing home opens up many more areas in which to live

Plot Size 

Along with location, new builds often compromise on the size of the plot. Especially in new subdivisions, developers and councils tend to get as many homes in as possible. For many this isn't a big deal as these new subdivisions also have planned green spaces and parks. Additionally, homeowners with land and located close to a city have been subdividing in greater numbers recently, so the quarter acre dream isn't particularly obtainable these days anyway.


Purchasing an existing house can bring with it the benefit of having mature trees and landscaping. The landscaping in a new section could take 10 years or more to take shape. 


The overall costs of the building vs buying is so dependent on what you are trying to achieve. Many believe that building is the cheaper option but this can put down to things like plot size and location. Price can also vary depending on location within New Zealand, property market conditions and the volume of homes being built. 

What are the disadvantages of buying an existing home?

Work required immediately

Depending on the state and age of the home you are purchasing, some work may be required right away. If this is the case, will your bank provide extra capital in order to get this done? If the house is not move-in ready, will you have a gap in accommodation you need to sort out? 

The unknown history of a house

One of the major concerns when buying an existing house is the unknown history. Even if a LIM report doesn't show any un-consented work, you still don't know the construction history. This could be a sticking point in earthquake prone cities like Wellington where there is no EQC rating for residential buildings.

Can’t decide if you should build or buy?

After taking all these points for and against building you home, making a decision can be difficult. Take all the advice you can and try to make the best objective decision for you and your family. Local building experts and real estate agents are more than happy to provide advice wherever they can. 


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