Buying vacant land in Johannesburg: Is it really cheaper than a built home?
Thinking of buying vacant land instead of a house? As estate agent shares what prospective homeowners should know before making a decision.
We live in a time where every Rand counts. With the cost of living continuing to rise, making smart financial decisions has become more important than ever.
For many people, owning a home remains one of life’s biggest milestones. Beyond having a place to call your own, a home can become a long-term investment that can be passed down to future generations. It also offers peace of mind, knowing you have a place that truly belongs to you.
One of the biggest decisions prospective buyers face is whether to buy vacant land and build from scratch or purchase an existing home, either from a homeowner or directly from a developer.
According to Nimmi Kowlaser, a Johannesburg-based estate agent from Saitis Properties, the answer depends entirely on your financial situation. Rather than making assumptions, she encourages buyers to carefully assess their finances, do thorough research and seek professional advice before making a decision.
Nimmi says buying vacant land can make financial sense for buyers who have enough cash available. However, for those who need financing, the costs can quickly add up.
“If you finance the land first and only later apply for a building bond, you may end up carrying two financial commitments. To the average person, those costs can become quite significant,” she says.
She also cautions buyers against underestimating the many expenses involved in building a home. Besides the cost of construction itself, buyers need to budget for:
- Architects’ fees
- Engineering fees
- Municipal approval
- Attorneys’ fees
- Other administrative costs
In some cases, these expenses alone can exceed R200,000 before construction even begins.
As a result, Nimmi says buying an existing home or purchasing directly from a developer is not always the more expensive option. Once all the additional building costs are taken into account, buyers may find that a completed home offers better overall value.
Nimmi also reminds buyers that owning vacant land comes with ongoing costs. Depending on the location, and if the land is in an estate, owners may still need to pay rates, levies, municipal charges and maintenance costs while the land remains undeveloped.
Whether you choose vacant land, a completed home or a property from a developer, the right decision will depend on your budget, long-term goals and ability to cover all the costs involved. Taking the time to research every expense before signing on the dotted line could save you thousands of Rands in the long run.
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