3.2.4 Why buy new?

There are several benefits to buying a new investment property over a not so new investment property. Some of these benefits are:

• Better tax deductions; new properties have an additional 2.5 per cent annual depreciation allowance based on the cost of construction and you get higher depreciation of fixtures and fittings. Speak to your accountant.

• Easier to rent; tenants will generally choose to rent a new property over an older property.

• Builders are required to provide a warranty on the property’s construction; this is usually for a period between 7 to 10 years.

• Minimal maintenance required in the short to medium term.

• Developers often offer incentives to encourage buyers, for example they may offer to pay the deposit, stamp duty or conveyancing costs. You can also make significant saving if you buy off the plan.

• Heating and insulation installed in new properties makes them, on average, four times more energy efficient than older properties.

• New homes offer modern design features and conveniences which also attract tenants.

• New developments are built to high safety standards with quality materials to meet increasingly strict regulations.