New Homes Vs Existing Homes
What are the pluses and minuses of buying a new home versus an older home. We explore the differences.
Freshly constructed homes have good quality control standards, newer construction techniques, and better energy efficiency than many older homes.
The newer homes have great insulation properties and normally consume very little electricity. One of the largest costs of having a home is electricity. The normal temperature for the majority of the year is near 100 degrees. New insulation techniques in building walls, double pained windows, and excellent insulation in the attic area, help make up the excellent cost savings of having a new home.
They often carry a 1 to 10 year warranty and good financing options. What I like is that many new home builders have their own financing division. This usually means that they approve Buyers with “less than perfect” credit scores. I work with many builders that approve 580 and above credit scores.
The downside is that while they are easy to get into, it is very difficult to sell them for a few years. What I mean here is this. If the builder is still in the subdivision, they are still selling new homes at their “retail street price”. The new home price is often higher than what a one, two, or five year home would sell for. Loans in their early stages are mostly interest payments and little is applied to the principle of the loan. My comment is that you may have troubles selling in the 1 to 5 year period if the builder is still in the area building.
Another downside to a new neighborhood is trees and lot sizes. I hear this more than you can imagine. Buyers ALWAYS want an area with established yards and big trees, but do not like the older homes and outdated features in an older home.
In a newer subdivision, the neighborhood will not be established, there will be very few shade trees like in an older neighborhood, and it will have more of a frontier feel.
If you like “new” and “shiny” like a new car, then the clean smell of a new home will be your thing.
These are owned by homeowners who want to sell their homes.
They have been seasoned, and may be better constructed than newer homes. I say that with a caveat. Up until the late 2000s, many homes shared the same styles of construction and energy saving features. The builder, and his reputation as a quality builder, usually made up the key difference in whether to purchase a certain home over another.
As mentioned above, new building techniques and insulation features have edged out older homes ability to compete on equal grounds. This is my opinion, and I feel that through the years of selling and helping Buyers buy homes, older homes are great but newer is better.
Many people like the fact that they have the charm and history of having been lived in – in fact, many buyers think that a new home is “cold” if it hasn’t been lived in.
Their age gives them respectability, and they are in established neighborhoods with tall trees and established neighbors and schools. They may be funky/customized with interesting quirks. These are for people who like “established” OR “different.”
They are much easier to sell soon after you buy one. Many also carry a 1-year warranty. This 1 year warranty would be from a independent warranty company that covers the used components of a used home.
They may not appeal to people who like being the first in a home or who want one built especially for them.
Which do you like better – New or Existing?
People who like one may not like the other, though there are many exceptions who like both. I have seen used homes with so much character and charm. I also have seen many that are “train wrecks” in function and layouts.
If you are looking for a new home, I would invite you to contact me. I can provide you with many tools to make your home hunting a lot easier. Free of charge, of course.
Make sure you look at my experience and use it to your advantage, for free. As a Buyer’s Agent, I represent YOU and your best interests. My fee is paid by the Seller’s Agent splitting the commission IF they sell the home. The Agent’s name on the sign works for the Seller. In Texas, you have the right to have representation. Do the right thing and call me.
I work with new construction builders and have a handle on the new neighborhoods, the schools, and the models available within the area.
Resources: RGV Builders Association