Buying New Construction Versus Existing Homes
One of the biggest distinctions between the types of property available in the U.S. housing market is a fairly simple one: new vs. existing homes. While buyers might not initially think much of it, the difference between buying new construction and purchasing an existing home includes many choices concerning price, practicality, resale value and much more.
Benefits of new construction
Some of the most obvious advantages of new construction homes involve quality and personalization. If the home is completely custom-built, the buyer has a say in everything about its design and construction. From the floor plan and layout right down to the placement of lights and electrical outlets, your budget and your imagination are the only true limits in a custom build.
Even in semi-custom homes built in a master-planned community, it’s fair to expect the quality and condition of a new home to be top-notch. Homes built today must adhere to all the latest standards for safety and efficiency from which many existing homes are exempt. That usually means new construction will include the latest-and-greatest in home tech, including floor plans designed for maximum energy efficiency and building materials that can withstand the weather, and then some.
Some additional benefits of new construction homes when compared to existing homes include little details that could make these properties generally more livable over the short- and long-term:
- New homes should require much less maintenance than older homes - after all, every component should be brand new. That makes budget planning for homeowners a little easier, not to mention less stressful for those who aren’t especially handy with repairs.
- Whether you are picking the exact location to build your custom home or buying a new unit in a planned community, buyers of new construction tend to be more pleased with their neighborhood’s amenities. Communities with a great deal of new construction are often centrally located, with easy access to transportation, grocery stores, parks and recreation facilities, and more top-notch community institutions.
- Buying new construction can be less of a hassle in terms of timing, too. If you’re going the full-custom route, the only uncertainty around your move-in date depends on the progress made by your contractors. The median time to complete a typical single-family home is around five months.
Existing homes: Benefits and drawbacks
The most obvious benefits of buying an existing home, as the vast majority of homebuyers do in the U.S., are simply the inverse of new construction’s biggest selling points. Some of these are basic economics, while many others are matters of taste or opinion.
Naturally, brand new homes come at a premium compared to most existing homes on the market. According to the U.S. Census Bureau, the median cost of new construction single-family residences came to around $304,500, while the national median for existing homes was $72,000 less. Of course, this figure doesn’t account for location, size, age or many other important factors.
The location of a new home is often a key selling point, but it could also be a detractor for certain buyers. Since space is lacking within densely populated urban areas, most new residences are built further out from the core of a city. That could mean longer commutes and more limited access to certain amenities. Brand new homes that are located closer to the city tend to be smaller and significantly more expensive than those that are further out.
Finally, the choice between a new home and an existing one could depend on seemingly minor details. Landscaping is one practical example: The older a home is, the more likely it will be surrounded by mature shade trees and vegetation tested by erosion and time. Good landscaping design makes for more than a pretty backyard - it can also mean stronger trees that protect the house from damaging wind and sun, as well as soil that absorbs or diverts water away from the foundation.
Keep these differences between new and existing homes in mind as you browse listings and come up with a homebuying plan, so you’ll be as prepared as possible. And when you are ready to start the mortgage process, the professionals at Trustmark will be ready to guide you through every step of the way.