For years, one message has echoed loudly across property forums and investor circles:
“Never buy New Builds.”
But like many blanket rules in real estate, this one is outdated — especially in today’s environment of record-low rental supply, elevated construction costs, and structural shifts in our housing market.
In 2025, new house-and-land packages are emerging as a strategic investment option for certain investors. Not because developers say so — but because the data finally supports it in specific markets and conditions.
This article breaks down the numbers, dispels long-held assumptions, and explains when (and why) new can outperform old.
show moreCash Flow Has Become King — And New Builds Are Winning
Australia’s rental market remains one of the tightest on record.
Vacancy rates (SQM Research, Oct 2025):
- Perth: 0.4%
- Adelaide: 0.5%
- Brisbane: 0.9%
- Regional QLD/WA/SA: 0.4–1.0%
This imbalance is pushing rental prices up at a pace older properties cannot match.
Annual rent growth (2024–2025):
- Brisbane houses: +5.6%
- Brisbane units: +6.5%
- Adelaide: +7–9%
- Perth: +10%+
New homes lease faster and attract higher rents. On average:
New-build homes earn 8–14% more rent than comparable older homes.
Why?
- Modern layouts
- Better energy efficiency
- Larger family-friendly designs
- Higher tenant appeal
- Lower running costs
For investors managing increased mortgage repayments, this cash flow buffer is meaningful.
Depreciation Deductions Are a Legitimate Advantage with New Builds
This is where new homes shine financially.
ATO data shows:
New properties generate 3–4× more depreciation deductions than established homes.
Annual Depreciation:
| Property Age | Average Annual Depreciation | 7-Year Total |
|---|---|---|
| New Build | $12,000–$18,000 | $90,000–$120,000 |
| 15+ Years Old | $3,000–$6,000 | $25,000–$40,000 |
If an investor sits on a 37% tax rate, then:
- $15,000 depreciation = $5,550 tax reduction per year
- Over seven years = $38,850 saved
This is real cash flow support — not just an accounting trick.
New Builds Reduce Maintenance Costs by Up to 90%
Investors often underestimate the real cost of older properties.
Over a 7-year hold, typical expenses look like this:
| Expense Category | New Build | Older Home (20–40 yrs) |
|---|---|---|
| Roof repairs | $0 | $3,000–$8,000 |
| Plumbing/electrical | $0–$500 | $4,000–$12,000 |
| Hot water system | $0 | $1,800–$3,200 |
| Painting | $0 | $4,000–$6,000 |
| Appliances | $0 | $3,000–$5,000 |
| Total (7 years) | $0–$2,000 | $18,000–$35,000 |
Every dollar saved on maintenance increases net yield.
In high-interest environments, predictable expenses matter.
New Homes Attract Better Tenants and Lower Vacancy Risk
In a tight rental market, tenant quality matters just as much as rental income.
Typical Tenant Profiles:
New Builds:
- Dual-income professionals
- Young families
- Long-term renters (2.4–3.2 years average)
- Higher household income
Older Homes:
- Shorter tenancy periods (1.3–1.9 years)
- Higher turnover costs
- Higher vacancy risk
Listings data shows:
New-build homes lease 30–50% faster than comparable older homes.
Fast leasing = fewer vacancy days = higher net returns.
Capital Growth Is Strong in the Right New Corridors
Not all new estates are equal — and this is where nuance matters.
In 2008–2015, many “growth corridors” underperformed because developers released too much land too quickly.
But in 2024–2026, the environment is different:
- Construction costs have surged
- Builders have collapsed
- Land releases are slower
- Infrastructure investment is reshaping outer suburbs
- Migration is hitting record levels
In many markets, demand is rising faster than land supply.
Examples of outperforming new-build corridors (CoreLogic 2018–2025):
Brisbane North
- Griffin: +38%
- Mango Hill: +41%
- Fitzgibbon: +36%
- Dakabin: +33%
Perth
- Baldivis: +47%
- Piara Waters: +54%
- Brabham: +51%
Adelaide
- Munno Para: +43%
- Mount Barker: +39%
These markets share one thing:
They are already 60–80% built out.
Less future supply = stronger growth.
This is the key difference between 2025 corridors and 2010 corridors.
New Builds Are Supported by Government Incentives
Federal and state policies increasingly favour new builds:
Major Incentives (2024–2025):
- First Home Guarantee (5% deposit with no LMI) — applies to new builds
- Energy efficiency rebates
- Stamp duty concessions in some states
- Enhanced depreciation rules (post–2018 construction)
- Lower insurance premiums
- Grants for sustainable design homes
These incentives attract more buyers — and more buyers mean stronger resale demand.
Lower Stamp Duty = Better Entry Numbers
In many states, stamp duty is calculated on land value only, not the building contract.
Typical savings:
- $8,000–$18,000 per purchase
- especially favourable in QLD, WA, SA
This improves:
- cash-on-cash return
- serviceability
- time-to-positive cash flow
Investors often overlook entry costs — but they matter for ROI.
Builder Warranties De-Risk Ownership
All new properties come with:
- 6–7 year structural warranty
- 12-month defect period
- Appliance warranties
- Workmanship guarantees
For investors who want:
- minimal surprises
- predictable costs
- stress-free ownership
…these protections reduce risk dramatically.
When Should an Investor Buy New?
Ideal For:
✓ Investors prioritising strong cash flow
✓ High-income earners who benefit from depreciation
✓ SMSF investors needing low-risk, low-maintenance assets
✓ Investors who want new, long-term tenants
✓ Those entering tight rental markets
✓ Investors with higher-income tenants in mind
Not Ideal For:
× Pure land-value investors
× Investors buying in areas with unlimited land supply
× Anyone relying solely on long-term renovation upside
The Balanced Investor’s Take
New builds are not “better” or “worse” than older properties.
They simply serve a different investment strategy.
New Builds Win When You Want:
- Cash flow
- Depreciation
- Minimal maintenance
- Strong rental demand
- Long-term tenants
- Predictable holding costs
Older Properties Win When You Want:
- Renovation upside
- High long-term land appreciation
- Higher scarcity
- Higher-value suburbs
The best investors build a portfolio, not a single strategy.
New Builds Can Be a Smart Wealth Strategy in 2025
The old rule — “never buy new” — came from a different era of oversupply, cheap building costs, and weaker rental markets.
Today’s market is different:
- Construction bottlenecks
- Record population growth
- Higher tenant demand for new homes
- Stronger depreciation rules
- Lower land release volumes
- Underbuilding across east-coast capitals
New house-and-land packages, when selected carefully, offer meaningful advantages in cash flow, risk management, and long-term rental stability.
They are not for every investor —
but for the right investor, in the right suburb, at the right time…
They can outperform expectations.
New house-and-land packages in 2025 offer higher rental yields, stronger depreciation benefits, low maintenance costs, and faster leasing. Data shows new builds outperform in tight rental markets across QLD, SA, WA, and outer-metro growth corridors.
👉 If you want a data-backed plan to identify high-performing new builds that fit your budget and goals, book your free Property Strategy Session today. Let’s map out the right investment before prices move again.
show less