Buy or Build: Which is Best for You?
When you’re ready to buy a home, there are so many things to consider - from the location to the cost; there’s big decisions to be made. One of those big preliminary decisions is if you want to buy a pre-built home that may come with things needing to be fixed, painted, or moved (potentially a foreclosed home), or buy land and build a new home that suits your exact needs and could be energy efficient? There are pros and cons to both, so we’ve outlined some things to consider when making this decision.
Pre-built homes are not as energy efficient as brand new build homes. Homes built today will regularly meet and/or exceed the standards set by Energy Star and WaterSense. Energy certifications covering the roofs, windows, doors, walls, and appliances are available to newly built homes. Retrofitting a pre-built home with energy efficient appliances helps, but it can be costly. In addition, homes that are newly built can have better air filtration systems, increasing indoor air quality, and can potentially reduce the symptoms associated with asthma or allergies.
Flexibility for your needs
When you’re looking to buy a home, what you need out of it may be different than what a pre-built home has to offer. Pre-built homes may include things such as low ceiling heights, formal dining rooms, fewer bathrooms and windows, and small kitchens, which can be costly to upgrade if you’re looking for a more modern home. When building a home, you are able to participate in the design process of the construction and have a more open space with high ceilings and large windows.
Newly built homes have the advantage of being constructed with modern fire retardants in carpeting and insulation and smoke and carbon monoxide detectors hard-wired into the home. Most pre-built homes do not offer these safety features, unless the previous owners upgraded their homes to include them.
Those that are looking to purchase a pre-built home have more limited financing options than those who are buying to build. The sellers of pre-built homes may contribute to settlement charges, but they can’t assist you with your loan needs. Those looking to build can customize their financing options and often defray closing costs during settlement.
Competition from other buyers
Purchasing a pre-built home will garner competition from others who are also looking to buy, and you may find your offers being rejected. Whereas, when you’re looking to build, there is virtually no competition, and you almost always have your pick of the land that you want to build on.
When you’re buying a home, you do so with the intention of living there for many years. However, there are a myriad of reasons to sell, such as an expanding family or moving for a new job. If you choose to build and then find yourself in the position of selling, your home may not be brand new anymore, but the desirability and resale value is higher than an older home.
Whether you want to finance building a new home or repairs and upgrades to an existing home, contact Renovo and talk to one of our team members to discuss how you can efficiently secure financing for your dream home.