When house hunting for your first or next home, the idea of purchasing a new construction home may arise. Here are some things you may want to consider before looking into the idea further:
-Most new homes built these days are brought up to modern standards for energy efficiency such as solar panels, water heaters, air conditioners, etc. which limit your environmental impact as well as lower utility costs.
-Most developers have warranties on the major structural aspects of the house such as the roof, appliances, basic foundation, etc. which can give the homeowner a sense of ease in case there are any issues with the house itself in the first few years of living in it.
-The houses built these days are made for modern times with modern makings such as open floor plans, updated kitchens, etc. so it’s move-in ready for the average homebuyer and good for resale later down the road as well.
-You can review the builder who is building your house to make sure they are a reputable developer.
-Although you don’t know your neighbors, you have to know that they can only afford what you can afford. So the possibility of the neighborhood going downhill in the near future is very low provided you buy in a safe location to begin with.
-You can buy directly from the seller using their lender and receive deals. You should still scope out the rates you can get from other lenders, but more often than not, the preferred lender of the builder will work with you and may offer a better rate than any other lender so they can streamline the process. The preferred lender may also, in a lot of cases, cover some or even all of the closing costs.
-You can choose the upgrades. Do you like hardwood floors? Upgraded appliances? You can pay to have them installed before the house is even built. Sometimes, you can even negotiate to have some upgrades included for free.
-You can feel comfortable knowing you’re getting a newly built home that was built with the modern standard quality materials that are warrantied.
-Most new homes are built close to each other so a lot of them have little to no backyard space.
-Because they are built close to each other, you’re also very close to neighbors. If you get “that one neighbor” who likes to blast music from his open garage door and have loud friends over all the time, you could have a problem.
-Appreciation takes longer than an old home. Once you pay for the upgrades you want, there’s not much more you can do to it. You have to pretty much wait for the market to fluctuate in a good direction AFTER years of putting in equity. Many websites say you should stay in a new home for a minimum of 5 years in order to at least break even. 10 years is best to make a solid profit for a new construction home.
-New construction homes are more expensive than resale homes. This is a no-brainer because newer is always more pricey as with any product.
-You have to deal with construction areas within your community for a few years. If you work a normal 9-5 job, you shouldn’t have a problem because the construction crews usually work during the day and are gone by the time you get home. But if you work from home, you may not like the constant construction traffic and noise.
-New homes lack character. Old homes have stories and sometimes quirky and interesting appeal to them. Some people love a home with character and most new homes do not offer that.
In the end, there really is no wrong decision whether you buy a new or resale home. Resale homes may be cheaper but there might be extra maintenance and utility costs you’ll have to deal with more than if you bought a new construction. But that all might be worth it to be in established community with a house that has character and a lower mortgage. Likewise, a new construction home can offer a sense of security and the opportunity to build a positive environment around you from scratch.