When you are looking for a home, you have two choices. You can buy and existing home or you can buy a new one, either a spec home that’s already built or a custom home that’s built to your specifications. There are advantages and disadvantages to buying new homes and existing homes. You need to weigh the pros and cons before making a decision.
Cost is a big factor when you are deciding between a new or existing home. Comparing apples to apples, building a home is usually more expensive than buying an existing home. That’s largely because labor and materials costs have risen much faster than home values over time. Of course, there are always exceptions, as extremely desirable areas may command huge premiums. But, in general, expect to pay more for a new house.
One big advantage of new home construction is that you will get a home in pristine condition. Since everything is new, you will have modern design features that should keep your home in updated condition for quite some time. Also, since all the systems are new, it should be years before you are faced with making major repairs or replacements to your home. Even heavily updated existing homes tend to have hidden problems that can reveal themselves soon after you move in. Since about one-third of home buyers are first-time buyers, who often don’t want to do a lot of work to a home, a new home can be the right choice.
When it comes to being able to customize your home the way you want it, whether that’s with a modern design or something more traditional, there is a big advantage to buying new, especially if you are having a home custom built. Building from scratch gives you the chance to get everything the way you want it, from where bedrooms and bathrooms are placed in the house to how the kitchen is set up. If you buy an existing home, unless you get really lucky and find someone with the exact same tastes, you likely will find yourself redesigning a kitchen, bathroom or some other room in the house. That can add a lot to your budget, especially if you are buying a luxury home that is already coming in at nearly $1 million.
As of February 2018, there had already been 1.3 million new homes built in the U.S. While there are many more existing homes for sale, there still are plenty of choices of both. If you want modern design, customization and reliability, a new home is probably your best choice. If cost and a certain neighborhood are your main goals, then existing homes are likely to be your best bet.