When it comes to purchasing a new apartment, we seemingly have two options – purchasing a new apartment from the contractor or purchasing an apartment that was previously owned. But in fact, there is another option that completely changes the rules of the game in the real estate market – purchasing a completely new apartment from the TAMA 38 project.
The TAMA 38 plan is a collection of regulations, established as a result of a shortage of building space along with natural wear and tear created in old buildings, and is intended to encourage apartment owners to strengthen the structure against earthquakes in exchange for expanding the existing apartment, adding floors for new apartments, and upgrading common property such as stairwells, lobbies, elevators, and so on. TAMA 38 and other urban renewal projects have opened the market to additional options.
Now the question is which purchase is more affordable, an apartment in a completely new project in a new neighborhood on the outskirts of the city or an apartment from an urban renewal project in the city center. The following issues will help you determine which is the right choice for you.
A question of price
Usually the deciding factor in purchasing an apartment will be the price, so it should be said that apartments purchased in urban renewal projects are about 5% -10% cheaper than the market price. Although these are brand new apartments, since the building is an existing building that has been upgraded and renovated, its market value is accordingly.
Nevertheless, many consider purchasing an apartment from a new project to be a safer investment. Compared to an apartment in a TAMA 38 project, an apartment in a new project is an apartment that has been fully planned in advance, taking into account all environmental factors and all possible limitations, while in an urban renewal project, creative solutions are often required in planning the new spaces, and planning difficulties are often discovered along the way that delay the project.
On the other hand, in a TAMA project, each apartment is well-planned, with attention to detail and optimal utilization of its space, so that in most cases these apartments will receive double treatment in their interior planning and design. In addition, it must be taken into account that when buying an apartment in a new project, there is excavation work and laying foundations that are not required in urban renewal projects of the TAMA 38 type, and therefore the construction time in these projects will be significantly longer.
Location Location Location
Another advantage of urban renewal projects is that you can usually find them in attractive locations in city centers, as opposed to new projects that are usually located in new neighborhoods on the outskirts of cities. A TAMA 38 project in the city center benefits from the existing infrastructure in older neighborhoods, such as kindergartens, schools, and libraries, and entertainment areas such as shopping centers and restaurants close to home, while in new neighborhoods you will often have to wait a long time for appropriate infrastructure to be built.
On the other hand, it should be noted that the more TAMA 38 projects there are in a neighborhood, the more the number of residents increases and the existing infrastructure may not be able to provide a response to the growing population.
And what do we do with the parking?
A central location is a great solution for those who work in the area and don't need a car to get to work, but in the event that you need to get to a more distant destination, you need to ask yourself how much time you want to spend in your car each morning. In older neighborhoods, construction is generally lower, and hence the number of residents is smaller and traffic is lighter, while in newer neighborhoods, tall buildings and even high-rise towers are often built, and hundreds of residents can live in each tower, and these residents are forced to spend long hours in the car each morning leaving the neighborhood.
In this regard, it is also worth considering the issue of parking, an issue that may constitute an obstacle in the case of urban renewal projects, since parking shortages are a recurring narrative in city centers. In the TAMA 38 project, the developer must offer a parking solution for the new apartments only, and only if the planning allows it. In any case, it is worth checking what the local authority's policy is regarding parking, as it varies from city to city.
Ultimately, when you are required to decide whether to purchase a "new from the bag" apartment or an apartment from an urban renewal project, you need to examine your needs and which of the options can best meet them.
