If you are considering buying a home, you might wonder whether or not you should buy an existing home or consider new home construction. Both have their own set of advantages and disadvantages.
Advantages of Existing Homes
- Seeing the finished product. With an existing home, you know exactly what you are getting. You can actually experience the home and see the size of the rooms and quality of construction, unlike buying a new home where you might just be looking at a drawing of a floor plan.
- Well-developed neighborhoods. When purchasing an older home, you can easily research the history of the area to see how well the homes have maintained their value. You can also explore the surrounding businesses, schools, parks, and other amenities to see if they are what you like.
- Mature trees and landscaping. There is nothing like beautiful oak trees in your yard!
- Uniqueness and character. Older homes can have more unique characteristics that give them charm. You can also choose homes in central areas, closer to downtown.
Disadvantages of Existing Homes
- Possibility of repairs. Depending on how well the home was maintained, you might need to do a considerable amount of repairs or updates. Be sure to budget for updates that you want, such as new carpeting or new appliances. Will you be able to afford these after closing?
- Less energy efficient. Older homes are usually less energy efficient, which could could mean larger utility bills each month.
- Outdated floor plans. An older home might lack some features that modern homes include, such as a multi-car garage or walk in closets. Although you might be able to do some remodeling, altering the floor plan can be extremely expensive. Make sure you can live with the space you purchase.
Tip: Before buying any existing home, always get an inspection to make sure that there are no hidden problems, such as a leaky roof, termites, or structural damage.
Advantages of New Construction Homes
- Designing your own space. Do you want a media room or an large covered patio? Not only can you pick your floor plan, you can also choose your flooring, wall color, tiles, brick, stone, cabinets, etc. The home you design will have everything you like – no remodeling necessary.
- Energy savings. New homes come with more energy-efficient materials that reduce your utility bills each month. Look for builders that are Energy Star certified.
- Less maintenance. With a brand new home and appliances, you shouldn’t have to do any major repairs for a long time. New homes also come with a warranty, which can give you peace of mind. Check with each builder to make sure you understand what is covered and for how long.
- It’s new! There’s just something satisfying about owning a brand new space that has never been used by anyone else!
Disadvantages of New Construction Homes
- Unsure of the future community. If a new community has just started being built, you might risk not knowing what the area will look like when finished. Always make sure you ask what else will be built in the surrounding area, and also research the builder to make sure that they have plenty of good reviews from customers. Possibly tour another community designed by the same builder to see if you are happy with the overall look and quality.
- The “cookie cutter” look. In some new home communities, the houses look very similar. If this bothers you, look for master-planned communities in which there are multiple builders and a variety of home styles.
- Undeveloped trees and landscaping. Those skinny trees will be amazing… in about 10 years. It’s rare to find new homes with well-developed landscaping, and if there are mature trees on a lot, they will cost you extra.
- Less room to negotiate price. Builders have a small profit margin on homes, so you will rarely negotiate the sales price of a floor plan, unlike existing homes in which the owner might have considerable equity and be willing to bargain. Most builders will offer some incentives towards design options or closing costs rather than lowering the price of the home.
- Location. Typically new home communities are on the outskirts of town, which can mean a longer commute depending on where you work.
Tip: You have a better chance of getting a discount on a new home when a neighborhood is close to being complete. Builders are often eager to close out the remaining inventory homes. If a neighborhood is near completion, you also have a much better idea of the overall look and feel of the area.
Whether or not a home will appreciate over time really depends on its location. Both existing homes and new homes can be good investments if they are in the right area. It’s up to you to decide which type of home appeals to you more.
Are you considering buying this summer? Ask me for help below! I’d love to discuss your goals.