New Construction or an Existing Home: What’s Right for You?
Today's homebuyers are in a difficult situation. Simply put, there are not enough houses available.
In September, Austin had 3723 active listings, which equates to only 1.1 months of home inventory. This is significantly less than the six months typically required to achieve a sustainable supply-demand balance that is considered a healthy market.
Given the limited quantity of available properties, you may need to broaden your search to include both new construction and resale homes if you're a buyer in today's market. However, comparing these two options might be difficult.
Let's take a closer look at some of the aspects to consider when deciding whether to build a new home or purchase an existing one.
TIMEFRAME
How quickly do you need, or want, to move into your next home? When deciding between a new build and a resale, your timeframe can be a deciding factor.
New Construction
If you choose new construction, you might be shocked at how long it takes to obtain the keys to your new home. Many home builders are currently facing unique obstacles as a result of the COVID-19 pandemic, including rising costs, labor and material shortages, and shipment delays. While building a home used to take about five to six months, many builders are now estimating construction timeframes of a year or more.
Because of these concerns, some builders have had to cancel contracts or increase prices on unsuspecting homebuyers long after they have signed a contract with them. Unfortunately, this scenario might throw your relocation preparations into disarray and cause a big delay in your timeframe.
It's critical to have a real estate agent represent you in a new home purchase to avoid these kinds of shocks. We can assist you in negotiating better contract terms and advise you on the potential pitfalls that could come your way.
Existing Home
Are you're in a hurry to settle into your new home? You might want to consider looking for an existing property.
In most cases when you buy a resale home you will have the option to move in right after closing. The average time to close on a house purchase is 35 days; however, this might vary depending on the loan type and market activity.
If you are a cash buyer, it's may be possible to close sooner, allowing you the option to move in even quicker. Many sellers, in fact, prefer a closing as quickly as possible, so it is often an advantage in a competitive market to make a cash offer.
LOCATION
There's a lot to think about when choosing your next neighborhood, from commute times to construction finish outs to amenities.
New Construction
With a brand-new home, you're more likely to choose an area on the outskirts of town that is still being developed. This could result in a longer commute and the need for construction to continue in the community for some time.
New developments, on the other hand, can provide a wide range of perks that appeal to modern homeowners. Water features, hike-and-bike routes, tot lots, and dog parks are just a few of the new features many master-planned communities around the country are including. Some have their own urban-like hubs with restaurants, shopping, and office space, as well as new schools.
Existing Home
A pre-owned property is more likely to be in a neighborhood with mature trees, established schools, and a strong sense of community. As a result, the trajectory of the neighborhood may be more predictable than that of an up-and-coming location.
However, when compared to newer developments, facilities may be inadequate and infrastructure may be outdated. While some purchasers like an older neighborhood's charm and eclectic character, others prefer a newer development's sleek and coherent appearance.
MAINTENANCE
Do you like a low-maintenance lifestyle or are you a DIY enthusiast? Set realistic goals for how much time, work, and money you'll put into keeping your new house.
New Construction
Everything is completely fresh and new when you build a house. As a result, you should expect less required maintenance and repairs in the first few years. According to a 2019 survey, millennials' homebuying regrets are frequently due to maintenance issues rather than other worries. If you'd rather spend your weekends exploring your new area than replacing a broken faucet, a turnkey build may be the way to go.
However, this does not imply that a new home will be completely maintenance-free. In fact, depending on the builder, you may end up doing more repairs than you anticipated. Because some home builders have a bad reputation for sloppy workmanship and inferior materials, it's critical to choose one with a good track record. We can assist you in locating reputable builders in our area.
Existing Home
You may come to regret buying an older home if it costs you a lot of money in unanticipated maintenance and repairs, no matter how good of a deal you got when you bought it. Home improvements have been more expensive in recent years, according to HomeAdvisor's annual True Cost survey. For example, installing a new HVAC system could cost you $5,371 on average. And you can expect to pay nearly double that amount ($9,375) for a new roof.
Fortunately, there are strategies to budget for such major purchases. Whether buying a new or old property, we always advise our purchasers to engage a professional home inspection. We can negotiate with the seller on your behalf for acceptable repairs or concessions once we get the inspector's report.
ENVIRONMENTAL IMPACT
Do you want to live a greener life? If that's the case, there are a few things to think about while choosing your future house.
New Construction
The need for energy-efficient housing is increasing, and many builders are rising to the occasion. The Residential Energy Services Network assigned a HERS (Home Energy Rating System) Index Rating to about one-quarter of all homes completed in 2020. A HERS rating is an index score that compares a newly constructed home to those that were common in 2006. The higher the home's energy efficiency, the lower its score.
In 2020, the average home was 42 percent more energy efficient than those built in 2006, and 72 percent more efficient than those built in the 1970s. If energy efficiency is important to you, a new home with a low HERS rating can be an excellent option. You can also seek for one that is ENERGY STAR Certified, which indicates it satisfies the Environmental Protection Agency's stringent efficiency standards. Only 7.9% of homes built in the United States achieved this designation in 2020.
Existing Home
Reduce, reuse, and recycle are, of course, fundamental tenants of sustainable living. A resale home also has a lesser carbon footprint because it was previously owned. According to studies, repairing or retrofitting an older home is frequently more environmentally friendly than building one from the ground up.
Environmentally aware buyers can also feel comfortable about purchasing an existing home with some energy-saving efforts and intelligent modifications.
DESIGN
Must-have design features may influence whether you build new or buy resale.
What's important to you? Open floor plan? Kitchen island? High ceilings?
New Construction
When you move into a new home, you can be sure that everything will be shining and wonderful. Builders frequently emphasize visual features and adhere to current design trends. Newly constructed homes, for example, are more likely to have an open floor plan, a central kitchen island, and 9+ foot ceilings, all of which are desirable features for many modern buyers. They're also not likely to have carpet on the main level or laminate countertops, both of which have fallen out of favor with the general public.
However, some buyers claim that new homes have a cookie-cutter feel to them because they are generally built in the same style. That doesn't rule out the possibility of incorporating your own personal style. We can assist you in negotiating bespoke additions and upgrades to personalize and make the room feel like your own.
Existing Home
An older home with traditional styling and character can be highly sought after in some of the most prized communities. On the other hand, an existing property is more likely to appear outdated if the previous owners have failed to engage in updates that reflect current design trends.
While some homebuyers love an older home's classic style and history, others want something more modern. If that's the case, we can assist you in finding a resale home that fits within your budget and allows you to renovate or has updates to your liking.
WHICHEVER PATH YOU CHOOSE, WE CAN HELP
There is no one-size-fits-all answer when it comes to deciding between a new build and an existing home. There are a lot of things to think about, and you may have to make some sacrifices along the road. However, the home-buying process does not have to be stressful.
We're here to assist you. Our homebuyer advice and expertise are frequently provided at no cost to you! This is because the seller or builder of the home may pay us a commission at closing.
Occasionally homebuyers make the mistake of going to a builder's sales office or even buying a home without consulting a real estate agent. But keep in mind that the builder's agent or "sales consultant" is looking out for the builder's interests, not yours.
We are familiar with both new construction and resale house options in our area, and we can assist you in making an informed decision, negotiating a fair price, and avoiding costly mistakes. Give us a call now to set up a no-cost, no-obligation consultation, and let's get started on finding your next home!