Buying vs. Building a Home: Advantages and Disadvantages of Each

Buying vs. Building a Home: Advantages and Disadvantages of Each

It’s one of the oldest questions around when it comes to real estate: Should you buy or build a home? The answer isn’t always cut and dry. There are definite advantages and disadvantages to both approaches. Here are a few things worth keeping in mind if you’re deciding whether to buy or build your next home.

What’s Your Timeline?

Time is a huge factor in determining if you should buy a home or go ahead and build your own. Unless you’re really looking for the perfect place, it will take longer to build a new home than to buy one. Essentially all you have to do in order to buy a home is get approved for a loan, find the right house, get a home inspection, then sign. Of course, there are intermediary steps; but that’s really the crux of it.

Building your own house requires a lot more legwork. First you need to have a vision of what you actually want in a home. Then you have to find a reliable architect and contractor and create a blueprint. You also need to get permits. You’ll need to dig a well and have electricity brought to the property. This all needs to happen before you even break ground on actually building the home, which will have its own set of complications. If you’re crunched for time, building a new house probably won’t be the best option.

How Much Can You Spend?

Your budget will also help determine whether you’ll be better off buying a home or building a new one. It’s typically more affordable to purchase a pre-existing house than it is to build a home. There’s simply too much more work that goes into new construction. However, upfront costs aren’t always representative of long-term spending. Purchasing an older home—even for a more modest price tag than new construction—can end up costing you more in the long run.

Here are a few expenses often associated with older properties:

More Maintenance: A new home should (hopefully) not incur too many major maintenance costs (new roof, foundation, updates, siding, etc.). Houses with decades of history often need big renovations. These costs can add up to a lot really fast.

Higher Insurance: New homes tend to be safer and sturdier than older ones. Compare home insurance quotes to see how the age of a home can affect rates. Newer houses generally mean better rates.

Energy Costs: Modern homes are much more energy efficient than ones built many years ago. Energy costs can quickly get out of hand if your house isn’t well insulated.

How Picky Are You?

Of course, possibly the most desirable aspect of building your own home is the fact that you get to make every design decision. When purchasing a pre-existing house, you’re at the mercy of whatever’s already there. You will have to pay to replace anything you don’t like, which will run up your costs. Building your dream homes lets you be in total control. All your idiosyncratic tendencies can be appeased by your design decisions.

On the flip side, you should be mindful of how far you take your personal whims. Every choice will affect your ability to sell the house in the future should you ever want to move again. People will be turned off if your customizations are detestable to everyone but you.

There are myriad things to consider when deciding whether to buy or build a home. Don’t worry; it’s totally normal to feel overwhelmed by this process. Try writing down your own list of pros and cons to supplement these overarching concepts.

Comments

  1. Cynthia R says:

    We’ve been deliberating this. In our area the housing market is crazy, houses get scopped up by multiple offers by the end of the first weekend. Also he seems to be picky… building seems like such a pain but it may be the way to go for us.

  2. Lauralee Hensley says:

    Also with new home building versus an older home that you want to update things in, you don’t have various contractors coming in replacing this or that in your older home that you didn’t like in the first place and wanted changed to your preferences. So that means someone has to be home to let those contractors in and be there while they work. Sometimes they don’t show up as promised or leave in the middle to go give quotes to others calling them on their phones, or even in a flooring case I had leave a job partially done to go and do a bigger job they just got over the phone because it would bring them in bigger money than just the one little room I wanted done. This messed up plans I had to be able to get my mom who was ill in that bedroom on time. She had to stay at my sister’s home for a few days and my sister didn’t really have the proper medical training to take care of her. Sis was calling me with questions on what to do and how to do it for our mother. I couldn’t really leave my home either to go and check on my mom at my sis’s home because I didn’t know if that guy would show up or not. I got this contractor through Lowe’s. When the job was done I did get a call from Lowe’s asking me to score my experience, boy did they get more info than they wanted. Yet, they did say they thought they’d be taking that contractor off of their lists of job referrals. I know Lowe’s gave him a talking to because he called me and wanted me to call Lowe’s and tell them that this was how all contractors had to budget their time to be able to make a living. I didn’t though, because I thought his excuse was lame. So how many people and for how long do you want them coming into your older home and fixing those things you don’t like doesn’t just have to do with the money, but the disruptions they can cause, especially all the adults in the homes have jobs that they have to take time off of to be home for the changes/repairs.

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