While older homes often have a certain charm that’s appealing to buyers, there’s something about a new construction that others love. The thought of being the first person to live in the home is enticing. You can leave your mark and in some cases have the home built to your specifications.
As great as this sounds, there is still the question of whether a newly built home is worth the investment.
Advantages of Investing in a Newly Constructed Home
One of the primary reasons people buy a newly built home is to be the first one to live in it. They feel confident that there aren’t any hidden surprises that often pop-up in older homes with multiple owners over the years.
Walls, pipes, and wiring are all up to current code standards, which means the new owners won’t be shelling out money for repairs after moving in. You also have the advantage of the active warranties that come with a new home build.
If you’re there at the start of the build, you often have several options to choose from. Do you want a dedicated nursey or a home office added in? You can also select wall colors, fixtures, energy-saving appliances, and flooring.
What about a home theater room for your laser projector and screen? You can have the builder add one in with the perfect amount of lighting.
Financing is a concern for most buyers, regardless of the home’s age. With a new house, you have the option of securing financing through the builder. It’s often easier to qualify for financing through the builder, instead of the bank. You do want to compare mortgage interest rates before you sign any contracts.
Buying a newly constructed home can also be a good investment. Depending on the upgrades you choose the price is often higher than an older home, but if the location is right when you’re ready to sell you might realize a profit.
Disadvantages of Buying a Newly Built Home
The main drawback to buying a new home is the price. The base price may look attractive but once you start adding on options, before you realize it, the cost of the home can increase by several thousand dollars.
The new home market is also highly competitive right now, which means you could find yourself in a bidding war for the property.
Simply because you are the home’s first owner doesn’t automatically mean that there won’t be problems. Before closing on the sale it is recommended that you hire an independent home inspector separate from the one used by the builder. It will be an additional cost that you are expected to cover.
You might also have to deal with nearby construction for a few years as the builders continue creating the neighborhood.
Other disadvantages to consider include the unknown property value. You could be surprised with higher property taxes than you were prepared for. If character in a home is important, you might be disappointed in a new build. Often home builders only follow a couple of designs to give the new neighborhood a uniform appearance.
There are always pros and cons whether you’re buying a new house or an older one. You do get the opportunity to put your touches on a new home as it’s being built. It can be customized to your tastes and preferences, but this luxury also comes at a higher price.
Older homes are generally priced lower, but there can also be unseen problems that you don’t notice until after moving in. Some might be minor repairs, while others can be expensive.
Before you fall in love with a new home, do your research. Check the builder’s reputation and the approximate property values of other homes in the neighborhood. If you’re happy with the information you find, a newly built home can be a good investment over time.