If you are planning to buy a home, one of the first decisions may be what type of property you should actually buy.
Should you buy an existing home that is ready to move into? Choose a plot-and-plan home from a developer? Or buy vacant land and build exactly what you want?
There is no single right answer.
Each option offers a different balance of certainty, choice, cost, time and responsibility. Understanding those differences before you start looking can help you make a much better decision.
The three options at a glance
1. Buying an existing home
An existing home generally gives you the greatest certainty about what you are buying.
You can walk through the property, see the size of the rooms, assess the garden, look at the neighbouring properties and get a feel for the area before making a decision.
You can also see how much natural light the home receives, how the rooms flow into one another and whether the property feels right for you.
The surrounding neighbourhood is usually already established, which means you can also assess the roads, traffic, schools, shops and neighbouring properties before you buy.
Another advantage is that you can usually move in much sooner than you could with a home that still needs to be built.
The trade-off is that the property was designed for somebody else. You may need to compromise on the layout, finishes or certain features, and an older home may require maintenance, repairs or renovations.
This option may suit you if:
- You want to see exactly what you are buying
- You would prefer to move relatively soon
- You want an established neighbourhood
- You are prepared to compromise on some features
- You would rather renovate gradually than manage a complete building project
2. Buying a plot-and-plan home
Plot-and-plan can provide a useful middle ground.
You are buying a new home, usually from a developer, and may be able to choose certain finishes, colours or optional extras without having to manage the entire building process yourself.
Depending on the development and how early you buy, you may also have some choice of plot or house design.
One of the biggest advantages is that you are getting a brand-new home without having to take full responsibility for appointing architects, builders and other contractors yourself.
However, it is very important to understand exactly what is included in the advertised price.
Items such as landscaping, boundary walls, paving, additional electrical points, upgraded finishes, air-conditioning, cupboards or other extras can sometimes increase the final cost considerably.
Also consider what the development will be like while construction is still taking place. Roads, neighbouring homes and communal facilities may not all be completed when you move in.
This option may suit you if:
- You want a brand-new home
- You would like some choice without managing a full custom build
- You are comfortable waiting for construction
- You prefer a more predictable building process
- You are happy to live in a developing neighbourhood
3. Buying vacant land and building your own home
Building from scratch normally gives you the greatest freedom, but it also comes with the greatest responsibility.
You can design the home around your own lifestyle, subject to local planning requirements, building regulations, estate rules and the characteristics of the site.
That can be very appealing if you have specific ideas about the layout, room sizes, orientation, finishes or energy-efficient features you want in your home.
However, the price of the land is only the beginning.
Your total budget may need to include architects and other professional fees, plans and approvals, site preparation, construction, finishes, landscaping, boundary walls and various other costs.
Changes made during construction can also have a significant effect on the final amount you spend.
It is therefore important to budget realistically and allow for a contingency amount for unexpected costs.
This option may suit you if:
- You have a very clear idea of the home you want
- You value design freedom
- You are prepared to wait
- You are comfortable making many decisions
- Your budget has room for unexpected costs
- You are prepared to be more involved in the process
Do not compare the options on purchase price alone
This is one of the most important things to keep in mind.
A property that appears cheaper at the beginning is not necessarily the option that will cost you the least by the time you are finished.
When comparing your choices, consider the total cost of getting the home to the point where you can comfortably live in it.
Depending on the property, this could include:
- Transfer and bond-related costs
- VAT where applicable
- Renovations or repairs
- Upgrades and optional extras
- Professional and design fees
- Building and approval costs
- Landscaping
- Paving and boundary walls
- Window coverings and other finishing items
- Additional accommodation costs while waiting for construction
- A contingency allowance for unexpected expenses
Before comparing options, make sure you understand what is included in each price and what you may still need to pay for separately.
If you are buying plot-and-plan, read the specifications carefully
A show house can look very impressive, but it may include upgrades that are not part of the standard package.
Before signing, ask for a detailed list of what is included.
Look at matters such as:
- Flooring
- Kitchen finishes
- Cupboards
- Bathroom fittings
- Electrical points
- Landscaping
- Paving
- Boundary walls
- Garages or carports
- Optional extras
Small upgrades can quickly add up, so it is better to understand the likely final cost before you commit.
If you are building, choose your builder carefully
If you decide to buy land and build, the builder you choose can have a major impact on the experience.
Ask for references and, where possible, speak to previous clients or visit homes the builder has completed.
You should also understand:
- Exactly what is included in the building contract
- What happens if the project is delayed
- How variations and additional costs are handled
- Who is responsible for approvals
- What warranties apply
- How payment stages work
Do not rely only on drawings, promises or attractive finishes. Make sure the important details are recorded in writing.
Think about the area, not just the house
Your choice may also affect the type of neighbourhood you are buying into.
An existing home is often located in a mature area with established trees, schools, shops and infrastructure.
A new development may offer modern homes and attractive facilities, but construction could continue around you for some time.
Vacant land may give you greater flexibility, but the surrounding area may still be developing.
Consider what matters most to you in your everyday life, including travelling time, schools, security, access to shops and the general feel of the neighbourhood.
Five questions to ask yourself before deciding
Before choosing between an existing home, plot-and-plan or building from scratch, ask yourself:
How quickly do I want to move?
If time is important, an existing property will usually offer the greatest certainty.
How important is having everything exactly the way I want it?
The more specific your requirements are, the more attractive building or buying plot-and-plan may become.
How much uncertainty am I comfortable with?
Existing homes generally provide greater certainty. Building introduces more variables around cost, timing and the finished result.
How involved do I want to be?
Buying an existing property requires relatively few design decisions. A custom build can involve many more.
What is my real total budget?
Do not base the decision only on the advertised property price or the cost of the vacant land.
Work backwards from the maximum amount you are comfortable spending and allow for the full cost of completing the property.
Which option is best?
The best option is not necessarily the newest home, the cheapest property or the one that gives you the most choice.
It is the option that best matches your budget, timeframe, lifestyle and appetite for involvement and uncertainty.
For one buyer, an established home that needs a little updating may be ideal.
Another buyer may love the convenience of selecting a plot-and-plan package and watching a new home take shape.
And for someone who has very specific requirements, buying land and designing a home from scratch may be worth the extra time and effort.
The important thing is to understand what you are committing to before you make the decision.
Thinking of buying in Durbanville or Cape Town’s northern suburbs?
If you are weighing up different property options and would like some straightforward guidance, feel free to contact us.
We can help you look at the practical differences between the properties you are considering and help you make sense of the options.