The differences: Buying a new or existing home

There are pros and cons to a new-construction home or existing home, so the decision may not be that easy as you consider a home purchase. No matter which way you go, you’ll probably end up making trade-offs. Choose the type of home that makes the most sense for you, your lifestyle and upcoming plans.

From an investment standpoint, it is wise to think about the future when buying. After all, you will be the seller one day and will no doubt want to get the largest possible return on your investment.

What if, for example, a home is one of the first in a new subdivision? As other houses are still being built, short-term resale of a 2-yearold house can be difficult. Given two similar choices in the same neighborhood, most buyers opt for a brand new house as opposed to one that’s been lived in. Additionally, builder incentives can make the new home down the street more attractive to buyers. This typically changes as the neighborhood matures and the builders clear out.

It’s not all about the investment, though. You must live in this home. Central air, large pantries, walk-in closets, multi-car garages, more and bigger bathrooms, and other contemporary amenities are more common in newer homes. Not many 40-year-old homes feature a master suite with a spa and two walk-in closets.

New homes are also built with infrastructure tailored to modern life — like having more electrical outlets or being prewired for security or Internet. Additionally, there are stricter building codes and significant advances in construction materials and techniques. These improvements result in safer and more energy-efficient homes.

Also, the builder may offer customization options, like color schemes, flooring, kitchen cabinets or appliances, that allow more personalization. Existing homes were built and designed to someone else’s standard and taste, which is bound to be different from yours. Also, keep in mind that many builders offer buyer incentives if the buyer chooses their corporate affiliated home-mortgage lender. But be aware that supply chain problems have delayed delivery of some building materials and that could potentially slow the home construction process.

On the flip side, many older homes have a charm from the period during which they were built. Some sit on larger parcels of land than the lots common in most new subdivisions. You also may find an existing home remodeled in a way that suits your needs.

Home maintenance comes with homeownership. There is no house that is maintenanceor defect-free — even brand new homes. In fact, it’s not uncommon to find at least one construction defect that must be addressed in a new house. So, if you do opt for a new home, make sure you understand the warranty and the process for identifying and fixing problems. As with the purchase of an existing home, buyers should have a new home inspected by a licensed third-party inspector prior to closing. Home inspectors will very likely find items that need attention and which can be easily remedied by the builder.

The neighborhood should be a significant part of your decision. Consider what you value — school district, proximity to your workplace, and day-to-day convenience are common concerns for most people, but your list may vary.

You’ll find that many residential builders acquire large tracts of land and start a subdivision from scratch. It’s more cost-effective to lay infrastructure and build if there are no obstacles. So, if you happen to be partial to large trees lining the streets, an older neighborhood may be more your style. Some new communities also initially lack services like nearby grocery stores, shopping or other things that you take for granted in established areas.

If you purchase a home before completion, delays could prevent you from moving in on schedule. This may end up being no big deal, but if the timing’s wrong, you may have to find a temporary solution. This may mean delaying closing of your current home, finding a place to rent, staying with others and finding storage.

A Realtor can help you sift through the options. Find one on HAR.com.