Making a choice between a newly constructed home and an existing home is like trying to determine if you’ll eat an apple or an orange. While they’re both tasty and provide you with nutrients, there are differences between the two. The orange requires more work to prepare it for eating, while the apple can be eaten out of hand. It’s the same with homes. New and existing homes can be attractive, and they both provide shelter. Both types of homes have their advantages and disadvantages.
You may be sick of hearing it, but location still remains the most critical aspect to consider when it’s time to purchase a home. Whether the home is brand new or 10 years old won’t make a bit of difference if you don’t like where the home is located.
The typical 10-year-old home is located in an established neighborhood with mature landscaping and a sense of community. New home developments, on the other hand, are often sparsely landscaped, and it may be years until what is there matures. Be prepared to spend thousands of dollars to have landscaping installed on your lot if it isn’t included in the price of the home.
You also have no way of knowing what type of community a new development will be until it is fully sold out and everyone has moved in. This may turn out to be a huge disappointment if you have little ones, were hoping for a family neighborhood, and it ends up looking more like a retirement community.
If amenities are important aspects of your ideal neighborhood, consider purchasing in a new home community. These neighborhoods typically offer a clubhouse, community swimming pool, playgrounds and other enticing amenities that you may not find in a 10-year-old community.
New home communities are typically located on the outskirts of town. If living close to shopping and restaurants is important to you, the older neighborhoods may fit your lifestyle better.
Proximity to work should be factored into the decision as well, especially if you are averse to commuting. That brand new housing community on the outskirts of the city may be enticing until you learn that living there means an extra half-hour commute.
One of the main attractions to a newly constructed home is the fact that all of the home’s major systems are new and less likely to need maintenance and repair. Naturally, if the older home has received no updating, many of the systems may be at the end of their lives.
Even new homes can have problems, so whether the home was just completed yesterday or 10 years ago, a home inspection is a must. That said, malfunctioning heating, ventilation and air conditioning systems as well as faulty appliances and bad roofs are some of the problems that home inspectors typically miss.
When comparing homes, hire a specialist to inspect the appliances and major systems. If you have any doubts about its age and functionality, hire a roofing contractor to inspect the roof. If any problems pop up during the inspection, ask for a repair or replacement allowance from the homeowner.
One of the most obvious differences between a new home and a 10-year-old home is that with the older home, what you see is what you get. Landscaping, window coverings, flooring and cabinetry typically remain in the home and become yours when you purchase it.
The new home, on the other hand, is a tabula rasa – a blank slate on which, for a fee, you can impose your own tastes. For some buyers, this is ideal. For others, it represents small details that they don’t want to worry about. It also represents a somewhat large chunk of money.
The older home will typically have a lower price per square foot than the new home, mainly because the cost of land has escalated. If you use the builder’s lender, however, there may be incentives that make the comparison moot. Some builders offer to pay closing costs or reduce points.
Don’t forget the hidden costs, however, in both homes. Ownership costs, as mentioned earlier, may be higher in the older home. The new home, however, may have homeowners association fees and miscellaneous assessments attached, such as for schools, roads and parks.
It’s a Lifestyle Decision
Considering the economics of a home purchase is wise, but the choice of a new home or an existing home is basically a lifestyle decision: close to town or removed, family neighborhood or sedate and quiet, the opportunity to choose the basics or what-you-see-is-what-you-get. How you choose between these and similar choices ultimately depends on your lifestyle.