Should one invest in new or old real estate?

Real estate investment is a topic that requires careful consideration of available options. Among these, choosing between new and old properties is of great importance. Each of these options has its own advantages and disadvantages, which must be evaluated based on financial goals, personal preferences, and market conditions.

Advantages of new real estate:

New condition: New properties have fewer risks of structural issues, major repairs, and immediate maintenance costs.

Energy standards: New constructions generally comply with modern energy standards, potentially resulting in energy savings and improved efficiency.

Eligibility for certain tax incentives: In some countries, investing in new properties can make the investor eligible for tax incentives, such as tax reductions (as is the case in France).

Disadvantages of new real estate:

High initial cost: New properties often have a higher initial purchase cost than old properties.

Limited short-term appreciation: Short-term appreciation may be limited as the market may take time to appreciate the value of new constructions.

Lack of historical charm: Some investors prefer the architecture and character of old properties, which may be lacking in new ones.

Advantages of old real estate:

Often more affordable prices: Old properties often have a lower initial cost than new properties, providing a more affordable investment opportunity.

Established location: Old properties are usually located in established neighborhoods with amenities, transportation, and services already in place.

Short-term appreciation potential: Old properties may sometimes appreciate more quickly than new constructions (especially if they benefit from renovations).

Disadvantages of old real estate:

Potential renovation works: Old properties may require renovation and maintenance works, leading to additional costs.

Lower energy standards: Old properties may not meet modern energy standards, resulting in higher energy costs or requiring renovations.

Less customization options: Unlike new properties, old properties offer fewer customization options.