Building Vs Buying

Posted on by admin

Home buyers are often torn between buying an existing home or building a new home. It all boils down to your budget, patience and flexibility. Before you decide you should weigh the pros and cons associated with buying or building.

Existing home

  • It is less expensive to buy an existing home and you can move in within a month or two after an offer is accepted.
  • There is more room for negotiation on the purchase price and concessions with an existing home.
  • Existing homes often have a seasoned lawn and mature landscaping.
  • The floor plan may not be exactly what you’re looking for and there may be remodeling and repair costs.
  • Home insurance costs may be higher with an older home.

Building

  • Getting exactly what you want. Working with an architect and builder, you have the opportunity to build it exactly to your specifications. Keep in mind you may spend more than you anticipated with continuous upgrades and changes.
  • Buyers have less room to negotiate the purchase price on new construction.
  • Location; finding the right spot, builder, etc. can take some time. Issues such as water and sewage have to be addressed.
  • Everything is new. New homes are typically more energy efficient.
  • It can take 4 – 6 months to build a new home. You may have to move to a temporary location during the building process.
  • Consider the additional costs associated with landscaping, window treatments, fence installation etc. Some builders provide allowances for these expenses.

Each buyer has a difference threshold for pain. Before you make your decision, talk to others you have built a home. If you need assistance navigating your decision, feel free to contact me for more information and lenders who specialize in new construction or renovation loans.

References:

The Pros and Cons of Buying vs Building a Home (November 26, 2018). Investopedia. Retrieved from : https://www.investopedia.com/video/play/pros-and-cons-buying-vs-building-home/Kerr, J. (July 29, 2017). How to Decide Whether to Buy or Build. Go Banking Rates. Retrieved from: https://www.gobankingrates.com/investing/real-estate/building-house-versus-buying-preexisting-home/