The difference between turnkey, ready built & completed homes
- Upsizing
The short version
- Ready Built and Completed mean the same thing: the home is built, or nearly built, before you choose it.
- A turnkey home only starts construction once you've signed the contract. You wait longer, but you get more say over where it goes.
- In NSW a builder can't ask for more than a 10 percent deposit, and any job over $20,000 needs Home Building Compensation Fund cover.
- First home buyers can claim the $10,000 First Home Owner Grant on a new home up to $750,000, and may pay no transfer duty on a new home up to $800,000.
- The First Home Guarantee lets eligible buyers get in with a 5 percent deposit and no lenders mortgage insurance.
Just like in any industry, building terms can be confusing for someone who doesn't work in the field. Particularly tricky are the terms:
- Turnkey
- Ready Built
- Completed
That’s because different builders use these terms in a variety of ways, especially when you compare across countries. Even within Australia, what one builder considers a standard inclusion in a turnkey home might cost extra with another company.
It’s worth a moment to reflect on the benefits of ALL of these ways of choosing a new home.
- You’re buying a brand new home that needs no renovations so is awaiting the addition of your personal touch through furnishings.
- Quality choices of design, fixtures and fittings have been made for you, saving hours of research and the agony of decisions.
- The contracts and finance are more straightforward, and if it's your first home there's a fair bit of government help on the table. More on both further down.
Let’s now look at each term in turn (try saying ‘term in turn’ five times quickly!) then summarise the overlaps and differences.
Turnkey
The term ‘turnkey’ is a cute way of summing up the situation of when a house is ready for you to turn the key in the front door and move on in. However, that front door will only start to be built once you’ve signed a contract.
Turnkey Pros and Cons
Pros of turnkey homes: You’ll have more options of the exact site of your home.
Cons of turnkey homes: You’ll need to wait between signing the contract and when your home is built.
Ready Built
A Ready Built home is exactly what the name suggests: a home that’s already (or very nearly) fully built and is ready to move into. We’ve already chosen an ideal floorplan and facade for the block, then added in classic contemporary design features, saving you the stress of making dozens of decisions.
Ready Built houses are waiting for you to choose your ideal home. And, because they’re either already built or will be finished in the next couple of months, move-in day can happen far sooner than other newly built home options.
Ready Built Pros and Cons
Pros of Ready Built homes: There’s no need to delay moving into your new home as it’s either already, or very nearly, built.
Cons of Ready Built Homes: As ready built homes are already built, there will be a limited number of options to choose from at any one point in time.
Completed Homes
The term ‘Completed Home’ is simply another way of saying ‘Ready Built’. So, this one’s an easy one: simply refer to the section immediately above, which outlines how these homes are not only already designed and planned but constructed.
Completed Pros and Cons
Pros of Completed Homes: Just like for Ready Built, Completed Homes are available to consider, view and choose whenever you’re ready to buy.
Cons of Completed Homes: Just like for Ready Built, supply and demand will determine how many Completed Homes are available for your consideration at any one time.
In summary
Let’s refresh the similarities and differences between these three new home building styles.
One way to simplify the three categories is to combine two, as Ready Built and Completed mean the same thing. With both, construction is already complete (or, at least, well underway) even before a buyer has chosen it as their home. So, in essence, you have access to a completely built home that’s ready to move into as soon as you are.
Then, the most significant difference between these two and a turnkey home is the timing, because a turnkey home only commences construction once you’ve signed a contract.
| Turnkey | Ready Built / Completed | |
|---|---|---|
| Timing | Construction starts after you sign. You wait for the build. | Already built or nearly there. Move in within a couple of months, sometimes sooner. |
| Choice | More say over the block, and the design is matched to it. | Design, façade and finishes already chosen. Limited stock at any one time. |
| Contract and finance | Often a split contract: one for the land and one for the home construction. The building deposit is capped at 10 percent in NSW. | A single contract. We only charge a 5 percent deposit on our Ready Built homes. |
| Grants | FHOG and transfer duty exemption can apply to a new build. | FHOG and transfer duty exemption can apply, as the home is brand new and unlived in. |
The contract and the money
We said earlier that the contracts are simpler. If you're buying in NSW, that comes down to a couple of rules.
A turnkey home is built under a home building contract. According to the NSW Government's home building contracts page, your builder can't ask for a deposit of more than 10 percent of the contract price, and any job worth more than $20,000 has to be covered by insurance under the Home Building Compensation Fund.
With a Ready Built home you're buying something that's already built or nearly there, and you can walk through the real thing before you sign rather than squint at a floorplan.
Grants and concessions for first home buyers
If this is your first home, both options can put you in line for some help.
- The First Home Owner Grant is $10,000 for a new home. Revenue NSW says it applies to new home purchases and building contracts up to $750,000. A Ready Built home has never been lived in, so it counts as a new home for the grant. Check your own situation with Revenue NSW before you bank on it.
- The First Home Buyers Assistance Scheme can take your transfer duty (the tax formerly known as stamp duty) down to zero on a new home up to $800,000.
- The First Home Guarantee, run by Housing Australia, lets eligible buyers borrow with a 5 percent deposit and no lenders mortgage insurance. Price caps change by location, so use the price cap tool on the Housing Australia site to check your suburb.
None of this is a substitute for a chat with a broker, but it's a good reason to have that chat before you rule anything out.
Turning the focus to you
Which option is right for you? This will depend on where you’re up to in your home-planning process. Have you got a deposit saved and your finances organised? (See our Ready Built Buyer's Guide) If so, you can look at either Ready Built / Completed Homes or turnkey Homes.
Need mortgage advice? Book an appointment with our finance partner at Mortgage Advice Bureau.
It will also depend on how specific you would like to be in terms of the specific location of your home, as this will influence whether you’re open to homes already built or not.
Why choose Rawson Homes?
With over 45 years of building homes, Rawson Homes are experts in knowing what new home-owners love. Our range of floorplans, facades and interiors appeal to everyone from couples to growing families and beyond.
We understand how significant every new house is for home-owners. We know that choosing a Ready Built or turnkey home can help make the process straightforward and transparent. After all, we want you to look forward with confidence to your moving day.
So, if you’re looking for a new home, please reach out to say hello today or explore our Ready Built Homes for sale.
