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When the need or interest in purchasing a home increase, the same question often arises: is it better to buy new or second-hand?
In this article, we are going to show you all the advantages and disadvantages of choosing one option or the other, so that you make an informed and conscious decision, being aware of the differences in price and taxes of the homes.
New home
The following are considered newly built homes:
- Homes purchased directly from the developer once their construction or refurbishment has been completed.
- Homes that have not been continuously occupied for a period equal to or greater than two years.
- Also homes that may have been acquired by a bank instead of an individual.
Advantages
Purchasing a new home has some important advantages:
- Brand new home. You will be the first to live in a property that no one has inhabited before.
- Better distribution. Being recently built, the spaces are better organized for functionality.
- Better lighting. Large windows are usually included in modern designs.
- Greater energy efficiency. Current construction materials and methods help reduce energy consumption. In addition, the Technical Building Code requires new homes to have thermal insulation to control their temperature, low-consumption lighting and that part of their energy expenditure comes from renewable sources.
- Possibility of customization. It is usually possible to choose the finishes when purchasing off-plan homes.
- No need for renovations. Being new, it will not be necessary to modify the building or the interiors.
- Warranty. New properties come with legal warranties covering defects for one year for finishes, three years for habitability issues, and ten years for structural flaws.
- Amenities. New homes usually incorporate notable elements, such as common areas. Among them, the parking, green areas and the community pool stand out.
- Payment. There are usually established deadlines for the delivery of certain amounts, so buyers have that time to save the corresponding amount.
Disadvantages
Although we have already seen that buying a new home provides some very positive aspects, it also has disadvantages that must be taken into account:
- Price. Being ready to move into and with acceptable qualities, the price of the home is usually higher than that of a second-hand home. However, they will not need additional renovations and will be more energy efficient, which may offset the price difference.
- Location. New constructions are usually located on the outskirts of cities and towns, with very few located in the center.
- Time. If you buy a new home off-plan, you will have to wait until it is finished before you can enjoy it.
- Taxes. When buying a newly built apartment, you must pay VAT (10%), a higher tax than the ITP (between 6% and 8%), which is paid when purchasing a second-hand home.
- Expenses.
Second-hand homes
Second-hand homes are those homes built and owned by a previous person other than the developer or a bank.
Advantages
Some of the most notable positive aspects of second-hand homes are:
- Lower price. The square meter has a lower price compared to a new home located in the same area. However, it is important to take into account the necessary renovations to the home when calculating the total price.
- Better location. This is one of their main advantages since they are usually located in central areas, where there are more services than in the outskirts. Thus, they are close to shops, schools and health centers.
- Shorter waiting time. Once the home is finished you will only have to wait for the financing, if you need it.
- Lower taxes. Unlike newly built housing, second-hand housing does not pay VAT and the Property Transfer Tax applied to it is lower, ranging from 4% to 11% depending on the Autonomous Community in which it is located.
- Fewer procedures. You save some paperwork when purchasing a home that is not new.
Disadvantages
Although the list of advantages is extensive, the disadvantages must also be taken into account:
- Fewer amenities. Second-hand homes are less likely to have facilities or common areas, such as a swimming pool or gardens.
- Renovations. Depending on the age of the property, more or fewer renovations will be necessary.
Buying a new or second-hand home is an important decision and each of them has associated advantages and disadvantages. In the case of a newly built home, you will acquire a brand-new home with better distribution, lighting and amenities but also at a higher price and in a less central location. As for second-hand housing, you will benefit from lower taxes and expenses, a lower price and a better location, but they usually require renovations and have fewer amenities.
Further information
This article is part of our service Real Estate Lawyer in Spain. Visit this section where you will find all the useful information on this topic, including a complete guide on How to buy a house in Spain.
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