Something old, something new: Should you buy a new or second-hand home?

So you’re thinking of buying a house? Whether you’re a first-time buyer or you are trading up or down, you may be weighing the options of a new build versus a second-hand home. There are pros and cons to both. Here are some factors to help with your choice.

1. Purchase finance

If you are a first-time buyer looking at houses in the €500,000 or less price range, government grants make buying a new-build makes sense. For example, the Help to Buy grant which is worth up to €30,000, only applies to new and self-build homes. The grant comes in the form of a refund of the income tax and deposit interest you have paid in the four years before you apply. The home must cost €500,000 or less. Similarly, the First Home scheme, where the Government or a participating lender pays up to 30 per cent of the cost of a new home up to a certain value in return for a stake in it, only applies to new builds. The one exception is the Tenant Home Purchase scheme version of this grant, which is available to a tenant wanting to buy the property their landlord is selling. Otherwise, if you want to avail of a purchase grant, buy a new-build.

2. Supply

Second-hand home or new-build? You may not have a choice. The supply of second-hand homes on the market is at an all-time low. Those that do come up can sell at a premium. New housing supply however is picking up with 29,000-30,000 completions last year. Supply may exceed 30,000 this year, according to official estimates. The policy focus continues to be on new, affordable supply – so that is where the bulk of the choice is going to be. Should interest rates start to fall this year, second-hand supply may pick up a bit. In the meantime, depending on the area of the country in which you are house hunting, you might have more choice in new-builds.

3. Size

Drive through residential estates built in decades past and you’ll notice the size of a house and plot on which it was built is far bigger than in most new developments. Whether it’s a groovy 1970s bungalow or a mock-Tudor 1990s semidetached house, developers were a bit more generous with the proportions. Depending on the era, there was likely a separate diningroom and the bedrooms were of a decent size. The house may even have a garage – remember them?

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“Generally there was better storage, which we don’t have now,” says building surveyor and Society of Chartered Surveyors Ireland (SCSI) member Val O’Brien. “There was more space, but sometimes less thought given to orientation. It was built to face the road, full stop.”

Let’s not started on the gardens, which have shrunk to postage-stamp size in recent years. “Density” is the name of the game today.

“Newer houses would generally be smaller, but they would be more efficient,” says O’Brien. “There are a lot of good things about that from a sustainability perspective.”

Until you can afford to retrofit, you will be paying a lot to heat a second-hand home. There’s that extra garden maintenance too.

4. Comfort

When it comes to comfort, a new-build with an excellent energy rating wins hands down. A home with even a B2 energy rating will have high levels of attic, floor and wall insulation that will keep heat in and your family feeling toasty. New windows and doors will keep draughts out. The house is at a constant temperature too, so you won’t dread moving from one room to the next.

Is there enough hot water for a bath or a shower? You will never have to ask this question again. A heat pump means there is constant hot water. Family life is no longer ruled by the immersion switch. Demand-control ventilation means better air quality too.

5. Running costs

A- and B-rated dwellings use far less electricity than homes with lower Ber ratings.

If you want to get technical, A- and B- rated dwellings used 42 kilowatt hours of electricity per square metre compared with 79 kWh per square metre for D- and for E-rated dwellings, according to Central Statistics Office (CSO) figures for 2021.

Searches by energy rating on MyHome.ie climbed by more than 35 per cent in the first two months of 2023 compared with the last two months of 2022. This was at the height of the energy crisis when the cost was causing homeowners real pain.

A ratings were given to 99 per cent of dwellings built between 2020-2023, according to CSO figures. So if you want to save hundreds, if not thousands on annual energy costs, a new build is the way to go.

6. Refurbishment costs

When you are buying a new-build, you get what you see. You can move straight in without a thought given to refurbishment or retrofit costs. For those buying a second-hand home, these costs will be a consideration.

Anecdotal evidence from estate agents suggests plenty of “sale-agreed” properties are falling through once buyers discover just how much time and money improvement works will cost.

Figures from the Sustainable Energy Authority of Ireland (SEAI) suggest that retrofitting a typical semidetached home will cost about €60,000, and that when grants are deducted from this it works out at about a €38,000 cost to the homeowner. Qualifying for a full grant can be tricky, and the full cost can come out higher again.

“What’s putting buyers off is the cost of renovation and also the availability of manpower to do it,” says Cork-based estate agent and SCSI member, TJ Cronin.

“They are asking, how long will this take, and what’s the project life cycle.”

It’s no wonder that some 69 per cent of estate agents say Ber ratings are now an important or very important factor in relation to the level of an offer.

If you buy an already refurbished second-hand house, but the style is not to your taste, you may end up paying for things you are going to rip out.

“I’ve seen the very best of stuff going into a skip because the buyer wants something that is unique to them. The refurbishment doesn’t add a significant amount of value to the property,” says O’Brien.

7. Services

New housing developments are often on the outskirts of town. Second-hand homes are typically in more centrally located estates where amenities and school catchments are better established. If you are buying in a new development, it’s worth checking that the area is well serviced. Forthcoming crèches, schools, transport infrastructure or community spaces may be alluded to in developer marketing materials. Their delivery is another matter.

[ First-time buyers: How to get to know an area before deciding to buy ]

Kildare and Wicklow, where new-home development has been most active, are both experiencing a shortage of school places right now as services have not yet caught up with the level of house building. It can take up to 10 years from inception to completion to build a new school.

Until services catch up with house building, exercise caution.

8. Growing room

Second-hand homes with a garage, a decent-sized attic, a larger garden and good side access may have more options to expand as your family grows. If adult children need a roof over their head, there are often options to convert the garage, attic or add a garden pod.

9. Changing vista

Older estates tend to be pretty stable in terms of boundaries. Decades may have elapsed since the estate was built and any major building that’s going to happen on their periphery has probably happened.

New developments can be in a part of town that is still in flux. Will that mountain view be blocked as more housing goes in?

If you are buying in a new estate with green fields around, planning files will tell you what might be coming down the track.

If you are buying off plans, check if multiple phases are planned. This is likely to increase traffic in the development.

10. Community

Depending on your life stage, moving into a new development with lots of other people who are at the same stage can be great. If you have young kids for example and everyone else around you does too, this can bring opportunities for connection and community.