Know Which Choice is Best for You Between an Existing Home or New Construction
So, you’re ready to purchase a home. To avoid getting bogged down in choices of location, size and budget, it’s best to take it one step at a time. You must first set budget parameters that will act as a guiding force for the other decisions you’re faced with. You may have strong feelings for or against purchasing either an existing home or new construction. It’s true that both choices have their pros and cons. With a new construction, you’ll have the ability to put your personal touch on the majority of the home’s features. But that comes at a high cost and you may prefer the less expensive option of purchasing an existing home in a neighborhood with deeper roots.
The Draws and Drawbacks of Existing Homes
While you may have to tolerate someone else’s poor design choices until you have the means to change them, there are many upsides to buying an existing home. First and foremost, there’s the cost factor. An established home typically costs about 10-15% less than a newly constructed home of similar size in the same area. You’ll also have the benefit of living in a well-established neighborhood and a home with some history and hopefully a little charm. The fact that existing homes come with established utilities is an added perk, as the initial setup of water, electricity, cesspools, communication, and gas lines often results in delays and complications.
Purchasing an existing home isn’t without its disadvantages. While the home will have history, it may not be all that charming. Older homes that weren’t well maintained can be outdated and in need of repair. It’s a good idea to have a building inspector visit the property to provide a comprehensive report of the condition of its foundation, roof, windows, plumbing, heating, ductwork, etc. Beyond basic upkeep, the home’s design may not be your taste so you must consider the cost of renovating and/or redecorating.
The Case For and Against Having a Home Built
We’ve already gone over the additional costs involved in purchasing a new construction, but what do you get for that extra money? To start, you get a brand new home that’s decorated to your liking. You’ll also be getting a clean slate with all your utilities and appliances. On top of that, most new homes come with a warranty covering certain repairs and malfunctions for a specified time. Your new construction may even make you eligible for a better mortgage rate and homeowner’s insurance terms.
Lest you think your investment in a new home is foolproof, your new utilities have the potential for growing pains, your property could have drainage issues, and there’s a chance you’ll get hit with the additional cost of HOA dues.
It will take some effort to weed through your choices and arrive at the home of your dreams. When you’re ready to evaluate your mortgage options, Cliffco is here to help. Call (516) 408-7300 and speak to one of our home loan experts today.