Many people mistakenly believe that finding your dream home is simply a matter of browsing listings and viewing a few properties. Sounds great, right? But the reality is that it’s not always that easy. Most homebuyers spend hours searching listings and view dozens of resale homes that don’t quite match their requirements. They eventually have to give up some of their initial ideas and settle for a home that they can live with or that can be remodeled to more closely resemble what they’re looking for.
Whether you’re just starting out in your home buying journey or you’ve been searching listings but haven’t found the right house yet, it may be worth considering a newly built home. Here is a summary of the key differences between a new build home and a used home.
New Build Home
- Personalization options allow you to create your ideal home
- Modern architecture and design
- Everything is brand new
- Builder’s home warranty
- Low maintenance costs
- Energy efficient
- Lower insurance costs
- Expertly-crafted neighborhood/community
- Valuable builder incentives
- Straightforward, transparent pricing
- Higher resale value
Used Resale Home
- Remodeling may be required to make the home more ideal
- Outdated floorplans and designs
- Old and worn materials and finishings
- No warranty included with purchase
- High maintenance costs
- Higher energy bills
- Higher insurance costs
- Neighborhood/community may vary
- Minimal incentives available
- Bidding wars and minimal price certainty
- Lower resale value
As you can see, there are many benefits to buying a new construction home over a resale. Let’s take a detailed look at these differences to help you decide on the best option for you.
When you buy a resale, you would have to have incredibly good luck to find a house that exactly matches your vision of a dream home. It’s more likely that you’ll find a home that’s less than perfect but has certain important features that meet your needs or can be remodeled to suit your preferences. On the other hand, a newly constructed home can be customized and built to precisely fit your needs and preferences, particularly if you choose a custom build.
Architecture and Design
New homes are thoughtfully built using the latest architecture and design trends that appeal to today’s buyers. A resale home, on the other hand, may have been built 10, 20, or even 60 years ago and likely contains outdated design features or finishings. Sure, you can renovate a resale home, but this can be both time-consuming and expensive, not to mention that it’s a major hassle. When you choose a new build home, you choose a home that’s perfectly designed to fit your family’s lifestyle and preferences so that you can live the life you’ve always wanted.
Condition of the Home
Buying a home, whether new or used, is a major investment. In addition to outdated systems and appliances, resale homes can have hidden defects that may not be uncovered in an inspection. It’s not uncommon for buyers of resale homes to find themselves facing large bills for repairing issues just a year or two after they move in. When you buy a new construction home, however, you get a house that’s in perfect condition. From your plumbing and electrical systems to your finishings and appliances, everything is brand new and free of defects.
New home builders provide a warranty that covers the cost of any issues related to the workmanship, materials, and structure of a new home. This gives you peace of mind knowing that if any issues arise they will be fixed at no cost to you. This is something that is most certainly not available with the purchase of a resale home.
Wear and tear is a gradual process that takes place as a home ages, causing defects and issues that require repair work. The older your home, the more time and money you will likely need to spend on maintaining it. A new home, on the other hand, is just that–new. It has no damage caused by wear and tear meaning you won’t have to worry about the inconvenience and out-of-pocket expenses associated with doing repair work on your home.
The technology and building materials available today have improved the overall energy efficiency of homes. If you live in an older home, you can expect high monthly utility bills, particularly during the winter and summer months when the home needs to be heated or cooled. Not only are new homes built using the latest technology, construction materials, and building practices, but they are also required to meet higher energy efficiency standards than older homes. Therefore, by buying a new home, you will be reducing your carbon footprint while also saving money on monthly utility bills.
The age of a home affects its susceptibility to defects and damage caused by accidents or weather-related events. Since newly constructed homes are built using the latest building materials and practices, they are less likely to be faced with issues warranting an insurance claim. Insurance companies, therefore, view new construction homes as less risky to insure than older homes and charge lower insurance premiums for them as a result.
Resale homes can be found in all kinds of neighborhoods from urban to suburban and rural. Choosing the ideal neighborhood in which to buy a resale home requires that you carefully assess your needs and priorities and thoroughly research your options before making a decision. Buying a new construction home takes some of the guesswork out of finding the ideal neighborhood. New home builders carefully select the neighborhoods where they build new homes to ensure they will appeal to homebuyers and hold strong value over time. They most commonly built in suburbs that are conveniently located close to major cities and offer safe, family-friendly environments.
In decades past, home builders focused on building homes rather than communities. Recent trends indicate an increasing desire for people to gain a sense of belonging from the community they live in. From master-planned communities to active lifestyle communities and more, today’s home builders are crafting communities and neighborhoods that foster a greater quality of life for their residents by providing all kinds of conveniences and amenities. Whether you want to have a gym, swimming pool, playground, or grocery store nearby, or you want to make friends and enjoy life more, you can be sure you’ll find a new community that offers exactly the lifestyle you’re looking for.
Price negotiation is an expected part of the home buying process in the resale market, meaning that the listed price of a home is usually not the final price you will pay. This can work for or against you depending on the climate of the market and the seller’s level of motivation. For example, during the recent peak in the U.S. real estate market, more than half of all homes on the market were being sold for more than their asking price. Price negotiation is typically not a part of the buying process with new construction homes. With a new build home, you get straightforward, transparent pricing where the listed price is the price you’ll pay.
Home Buyer Incentives
New home builders offer all kinds of incentives to home buyers, including free upgrades on homes, prepaid closing costs, and discounted interest rates if you choose to work with their preferred lender. These incentives can save you a significant amount of money on a new home purchase. Sellers of used homes sometimes offer incentives to lure potential buyers, particularly during times of market slowdown. Incentives offered by private sellers typically involve leaving behind items in the home such as curtains or a mounted flat-screen TV. Since private sellers can’t upgrade a home or provide a lender, the incentives they can offer are more likely to make your life a little easier rather than save you a significant amount of money the way builders’ incentives can.
Generally speaking, older homes sell for less than new homes. This means that buying a new home may cost you more than a resale home, but you will be better off when it comes time to sell. Financial advisors recommend thinking about a home purchase in terms of the return on investment you will get over the long term. A home that is new today will be newer and more modern than most other resale homes on the market in the future. This means that, if you buy a new home today and sell it after several years, you will get a greater return on your investment than if you bought a resale home.
NewHomesMate Is Here to Assist
As you can see, there are several key differences between new build and used resale homes, with new homes offering many advantages to homebuyers. If you decide that a new construction home is the right choice for you, NewHomesMate is here to assist. On our platform, you can search for and tour thousands of new construction homes and communities in your area, and we have new home experts who are ready to guide you through the entire home buying process.
Start searching with us today!