Should You Buy a New or Existing Home?
Maybe your
dream home has the intricate details that you usually find only in older
construction - wainscoting and crown molding in the interior, the front porch
with a swing, an older tree shading the back yard, and the white picket fence.
Or maybe your
dream home has all the conveniences of modern living - open floor plan in the
living and dining spaces, large windows, connected, “smart” appliances and
security systems, and minimalist design elements.
Whether you go
for a brand new construction or an existing home, both types of properties have
their pros and cons when it comes to purchasing. What type of home is right for
you will depend on which factors are most important for your lifestyle.
Build your dream home with new construction
If you’re making
a home purchase that’s still in the pre-construction phase, you may be able to
customize many of the details. Many home builders will give you the option to
add design elements that will give you the exact dream home you desire. If it’s
a new subdivision, you may even be able to pick which lot you like best.
Very early in
the building process, you may have more room to customize. For example, if the
walls aren’t complete, you may be able to add extra outlets in each of the
rooms or custom wiring for surround sound in the media room. Perhaps you could
move the laundry room to the top floor instead of the basement. You might be
able to get a separate mudroom entrance.
Later in the
building process, you may be able to add marble countertops, an island, and
custom cabinets in the kitchen. Your master bathroom could be upgraded with a
steam shower, spa tub, and European fixtures. You will want to check with the
builder to understand which features are included, and which ones are extra.
New homes save money with fewer repairs and more
efficiency
Once your home
is complete, all you’ll need to do is move in. New appliances will be under
warranty for a few years if they need repairs, and will likely work well for
several years without needing fixes. Often, new construction is under a
builder’s warranty, so any repairs needed in the first year should be covered.
New homes often
contain energy efficient and green appliances, like high-efficiency stoves,
refrigerators, washing machines, heaters, or air conditioning units. These
energy-saving appliances, along with good insulation and energy-efficient
windows, will help you save money on monthly utility bills.
New homes also
often use new building materials that require less maintenance — for example,
using composite siding instead of wood, which doesn’t need annual repainting.
You won’t need to spend as much to maintain your new home.
If you
customized it during pre-construction, you won’t need to spend any money on
renovations or upgrades for several more years. You can just enjoy it and not
worry about saving for major home repairs.
What you need to do to make a good new home purchase
Before you put
in your offer, do some research on the builder. Do they have a good reputation?
What else have they built? Did their other new properties have issues such as
poor construction or unfinished details?
You like the
model home, but will you like where it’s situated? After you look at the home
itself, come back to the neighborhood to see what it’s like at different times
of the day. Walk around during the day and in the evening, and see how you like
the area.
Brand new
communities usually attract similar types of buyers—urban professionals,
couples, or young families, for example. These will be your neighbors, so
you’ll want to make sure that you want to be part of this new, homogeneous
community.
You may also
need to be flexible with your move-in date. Builders will only be able to let
you move in if they can meet their construction schedule. If the wiring is
delayed, the walls can’t be finished. And because there are so many
construction tasks that are dependent on the completion of prior tasks,
schedules tend to slip.
Get more variety and established neighborhoods with an
existing home
Existing homes
are those that have generally been built and lived in between the 1920’s and
1970’s. With existing homes, you will get more variety in home styles, as
different types of construction have gone in and out of style throughout the
decades. Within one neighborhood, you may be able to find a mix of different
styles like Victorian, modern Tudor cottages, tract style, ranch or
split-ranch, or contemporary homes.
Existing homes
are situated in established neighborhoods, which may have more amenities nearby
that a new home in a brand new subdivision may not have. Your new neighborhood
may have restaurants, cafes, and boutiques within walking distance.
You might also
have access to more supermarkets, dry cleaners, discount stores, and gas
stations nearby. An established neighborhood might have a nice park, running
path, or playground for the kids to enjoy. You might also be closer to a
library or the post office.
Resale homes can be a less expensive purchase
If you’re
considering a resale home, you may be able to get into a beautiful, unique
property at a lower purchase price than a new home.
There are many
more resale homes available than there are new homes — according to the National Association of Homebuilders, about 10 times as many. With such a
large pool to buy from, the market for resales can be more competitive. You may
have more room to negotiate the selling
price of the home. With a brand-new construction, you won’t likely be able to
have the same kind of negotiating power.
Before putting
a home on the market, sellers often make home renovations or remodel parts of
their homes to make them more attractive to buyers and to be able to
potentially increase the list price. If the resale home has a brand new, modern
kitchen, an updated bathroom, or even a new roof or upgraded windows, you could
end up getting a home that’s comparable to new construction without having to pay
the potential more expensive new-home list price.
Existing homes
have already been inspected at least once on the last sale, so you will know
about any potential structural problems or repairs that have been made on the
home. Knowing the track record on your potential home will help you avoid
purchase mistakes—you’re much less likely to end up with a property that has a
rotting roof, dangerous electrical wiring, or a crumbling foundation. With a
new home, you could end up with incomplete construction or major issues that
you didn’t know about because they weren’t yet documented.
What you need to do to make a good resale purchase
Before you go
too far down the road to a purchase, you can protect your purchase by first
having the home inspected. A good home inspector will document all flaws, no
matter how small they appear. If the inspector finds any major problems, like
foundation cracks or leaky roofs, you may be able to counter offer and get the
seller to either fix it or reduce the selling price.
Even if the
inspection doesn’t uncover any major issues, you will need to expect the
unexpected. Older homes will eventually need replacement appliances, a new air
conditioning unit, or a plumbing repair. As long as you know that before you
buy a resale home, you can plan for surprise repairs.
With an older
home, you may want to eventually remodel parts of it. Will you be happy living
in your house while you’re doing major work on the living room or the kitchen?
If you know that it would disrupt your lifestyle too much, you may want to
consider whether you really want to buy an older property.
Whether you
choose to buy a new home or an existing home, the best way to get started is to
speak with your trusted real estate professional. We will have access to both
new properties and resale homes that may fit your goals, and will know which
neighborhoods will serve your needs.
