Ask LH: Will NBN Connectivity Add Value To My House?

Dear Lifehacker, A question I haven't seen addressed yet in all the NBN debate: Does having a fibre connection to the property add to its value? Thanks, Property Watcher

Photo: Tor Lindstrand

Dear PW,

It's a tough one to answer, simply because outside of very specific (and rather geeky) circumstances, an NBN connection isn't going to be the sole selling point of a given property.

It's also hard to draw from conclusive data in this regard, because NBN connections are still relatively scarce, although it's been suggested that some new greenfields housing estates may use the existence of NBN connections as a selling — and thus upsell — point. But even the Commonwealth Bank only suggests that it might become a selling point without pointing to specific data.

As the NBN — or whatever happens to it post-election — rolls out, it'll become more of a normal service expectation in any case, at which point any price "premium" for having a connection is likely to vanish, although a house that refused to have a connection linked up may find itself slightly less desirable in a competitive marketplace if the plans in that area still call for a FTTN connection.

Still, ultimately house value is determined a complex set of variables, including location and design, nearby amenities and the like, and I'd be extremely suspicious of anyone saying that an NBN connection was a specific value addition without a lot of hard data to rest on. As yet, nobody has that hard data, so I'd say that it's unlikely to be a major factor. After all, would you live in a crime-ridden dump with terrible neighbours and no view just because it had an NBN connection?

Cheers Lifehacker

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Comments

    I think the wiring of the house is more of a value to the property than the ability to connect to an external network that is yet proven. As per the article, the more available it becomes, the less of a selling point it will be. However a smart-house with fully wired data/optics would be of more value than one without.. so will NBN increase value, I don't think so.. but wiring your house to be future-compatible "might".

      epic point. wiring matters! I hate living in a home where the only phone line connection is in the most obscure place.

      I agree that it's great to have intelligent (and copious) wiring throughout a house, but I do know for a fact that it doesn't increase the value of a house one bit. Especially not NBN connectivity. It'd be similar to expecting more for a house just because it's located in a "full bar" 4G area, or just because it has a 3-phase power supply.

      Last edited 05/03/13 4:27 pm

    During the rollout houses will be offered to get connected for free.

    Its not clear, however, if some stuckist turns down this offer and you then buy the house, if you are going to be expected to pay to get connected.

    Something to consider further down the track.

      On the contrary SirGiraffington, it's VERY clear that if you turn down the offer of free installation as they roll NBN past your house that you (or whoever buys the place after you) will have to pay a connection fee to connect at a later date.
      I'd be factoring that cost into my offer if the house wasn't connected and was in an NBN connected area.

      As such, in the event of 2 identical houses next door to each other, House A connected with fibre and house B not connected, I'd happily bid a little extra for House A.

        The connectivity of a house should be pretty far down the list when it comes to purchasing criteria, certainly not a deciding factor between two houses (unless everything else is equal). That said, each to their own, and to be honest I'd be more than a little swayed by such things as well.

        Last edited 05/03/13 4:32 pm

    It's not as if it'll reduce the value of the property. IMO if the NBN is rolling past your place and you opt out of having it connected you're insane, regardless of whether you need it.

    Also I'd argue that there's probably a tipping point, where assuming a perfect world where everything gets completely rolled out and the service becomes ubiquitous, being the one property in your suburb without NBN access would instead reduce the value of your property.

    IIRC, the Coalition are saying they're likely to make customers pay individually for FTTH. Given the relatively slow NBS connection rate so far, that means "free" connections will stop sometime after 14/9 this year. New FTTH connections will probably become pretty rare, so existing ones will be an asset to any property, albeit a relatively minor one.

    Will NBN Connectivity Add Value To My House? In the short term yes, in the long term no.

    I think only a small segment of the population would pay extra because a prospective house is connected for NBN. Personally, I think it's a nice-to-have, but so far as my money goes it's more of a red herring....anyone who is focusing on NBN connections when buying a house is a fool. It's such a small $$ proportion of the entire sale. It's kind of like if a car salesman highlights a prospective car having a roof rack....it adds value but don't let it cloud your price point....

      I think it's more like whether the house has proper plumbing or not personally.

        You're definitely in the minority with that line of thinking. When it comes to real estate valuations and property inspections, connectivity doesn't come into it in the slightest. Don't get me wrong, though: I'm not saying that it shouldn't matter to you personally (it matters to me as well) but as far as the property market is concerned, it doesn't add or subtract a single cent when it comes to the value of a home.

        Last edited 05/03/13 4:42 pm

          Oh most definitely a personal preference. If I was looking for another house NBN connectivity would be high on my list of priorities. I just hope the Libs don't frak it up if they get in... :)

            Agreed. I heard some Telstra exec on the radio the other day explaining how he's told the Coalition that the the contract with Telstra for the NBN will not be up for renegotiation should (when) they come to power. He went on to say that if the Liberals do want FTTN as opposed to FTTH then that's fine, they can do that, but the price remains the same as FTTH.

          When I made a deposit on a house, I explicitly made it conditional on whether ADSL was available. There was no way I was going to own a house limited to dialup, or at best poor Telstra NextG reception.

          The RE was fine with that.

          Last edited 05/03/13 5:09 pm

            I would not buy a house that did not have a good internet conection for myself but a rental would not care to much but if choosing to have or not I would go for it. To me I put value on a property with fast internet and have and will again offer more for that option. I am a tech head so for me and Kodi we need the speed and latency

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