In a previous article we presented “four main steps to follow before you select a property”! Now we will try to answer a reasonable question that applies to anyone who decides to buy a property.
“Should I choose a property in a brand new building or save money with a property in an older building? “
This question cannot be answered straight forward since people’s decisions are governed by many factors. Financial conditions (such as: money savings, monthly income, possible financial support, secure job), family needs (such as: number of family members, age of kids), preferred lifestyle, purchase purpose (investment or residence) and many more factors varying so much that they cannot be standardized and at the same time they are too important to be ignored. Unfortunately it is impossible to approach the problem in a way applicable to everybody so we will mention some facts that everybody needs to take into account before taking a decision.
In order to be more specific we will go through a comparison for two identical flats in terms of size, floor level and location but completely different in the construction year of the building they are part of.
Building’s Permit Year for flat “A”: 2020
Building’s Permit Year for flat “B”: 1970
Size: 100sqm
Level: Second floor
Location: Athens
COST
Everything starts from the cost, especially when the case comes to a purchase of something as expensive as a property is. It is wholly reasonable that the oldest the construction the cheapest the price.
In our example if we assume that flat “A” costs 300K€, then flat “B” would cost something like 40% to 50% cheaper, thus 150K€ to 160Κ€. A radical renovation with good materials for flat “B” would cost 40K€ to 50K€ extra and that means that the total cost for flat “B” would be something around 200Κ€.
Even if both flats are completely new inside with the same materials, flat “A” costs 50% more compared to flat “B” just because of the building’s construction year.
Why does this happen?
FACILITIES
New buildings are adapted to nowadays needs so in the case of a new building, you are more likely to find, included in the price, a number of facilities and benefits such as: large elevator, wheelchair ramp, parking space, storage room, big balconies, modern interior design, large openings etc.
In our case flat “A” is for sure escorted by a parking space and a storage room, large squared balconies, large elevator etc. On the other hand it is more likely that flat “B” will not be accompanied by a parking space, it might have a small storage room in the basement and the balconies will be long and narrow.
Tip: Depending on your preferred lifestyle, some of the aforementioned amenities may be completely unnecessary to you and not worth the extra money anyway.
MATERIALS AGING AND BUILDING MAINTENANCE
Even if a total renovation occur in an apartment the rest of the building is still old. Sewers, waterproofing, hydraulic and electrical installation will need replacement sooner or later. This kind of costs are shared to the owners of the building and the budget is not significant as long as all of them are willing to pay their shares.
Moreover there are some materials that cannot be replaced and need maintenance due to corrosion. The majority of buildings in Greece are made by reinforced concrete that is subjected to small movements from earthquakes, weather conditions, environmental pollution etc.
The question of the maintenance and the well-being of common spaces in older buildings cannot be underestimated especially when during the financial crisis many apartment owners had difficulties in paying the shared costs of the building and in keeping the building in good condition.
Tip: You can have an idea for the building’s maintenance condition from you very first visit in each building. Pay attention to the building’s communal spaces.
Tip: If you are seriously interested in a property contact the building’s manager. Find out if everyone pays its shares, if there is any communal expenses reserve, how the building’s maintenance is made etc.
CONSTRUCTION REGULATIONS
Gradually through years building construction regulations became stricter mainly in terms of seismic shielding, energy consumption, fire regulations and disabled people access. The predominant reason why the permit year becomes important for a building is that you can find out the standards that were then followed for a building’s design and construction. Among all of them, seismic shielding is the most important in Greece since the country is in an earthquake prone region and unfortunately the older the building the more vulnerable it is.
In our case flat “B” belongs to a 50 years old building which is designed after the first Greek structural regulations while “A” belongs to a new building, zero years old, designed under much higher standards and advance technology materials where serious damages from earthquake vibrations are unlikely to occur.
Tip: Important improvements in building Greek anti-seismic design has occurred in the years 1959, 1984, 1995, 2000, 2003, 2011, 2013 and 2016.