You’ve done the groundwork in preparation to buy your first home. Your credit is impeccable, your debt-to-income ratio is low, and you have a mortgage preapproval in hand. As you start looking at building or buying, you must decide if you would like to go with a new home or with an older one. Each has its pluses and minuses to consider.
NEW HOMES: Whether the new home you are considering is being custom-built just for you, or if it’s an already-built new home being sold, new homes have some facets which are positive and others which should be considered.
Pluses: A new home is … well, NEW! That means that every system and every part of the structure, if well-built, should last a substantial time before needing replaced. Appliances and systems come with a manufacturer’s warranty, whether it’s your refrigerator or your AC. The framing is built to modern codes and standards, the electrical wiring is up-to-date and the foundation is likely water-tight. In addition, if your builder offers a 10-year warranty, you know that you have protection, as stated in your warranty, for 10 years.
New homes generally are in the suburbs, rather than the city. Probably, unless your new home is custom-built, your development has a homogenous style of home; not identical, but similar in appearance and design. New homes in a development may offer community amenities, such as a community pool or a common playground.
A new home will likely have updated technology, such as Bluetooth-controlled systems and sufficient outlets to accommodate modern living and technological needs. It will also be energy-efficient and well insulated.
Minuses: Your new home is probably not going to look like the incredible model home you may have toured in the development. Keep in mind that a model home will often include optional upgrades. The baseline model with no upgrades may not be as same cosmetically. And every upgrade comes with a price tag.
New homes also will likely have immature landscaping. Your lawn will not be full and lush immediately, and your trees and shrubs will look small and scrawny until they mature and grow. You also might choose to not complete your entire landscaping at first in order to save money.
Another consideration with a new home is that with any new construction, you might have some settling and subsidence to some degree, which depends a lot on your soil type. Land which has been excavated takes some time to stabilize. This settling may cause a few cracks or separation of trim in some spots.
OLD HOMES: An old home is one which has been previously owned. It might be a Craftsman from the early 1900’s, or it might be a ranch from the 1960’s. Again, like new homes, old homes have benefits and drawbacks.
Pluses: To many people, an older home has charm and personality that newer homes lack. It may have plaster walls, beautiful wood trim, hardwood floors, coffered ceilings, stained glass windows and other attractive features which would be unaffordable in new construction. Some older homes were hand built and have painstaking and artistic craftsmanship. Generally, older homes are unique and distinctive from the others around them.
If it has been updated with modern wiring and systems, an older home may be a good option for some. The construction has already settled, so no new cracks should appear.
The yard and landscaping of an older home is mature. Trees tower and provide shade. The lawn is full and lush. Often, the yard of an older home is larger than that of a new one.
Minuses: If it has not been updated, an older home may have systems and appliances that need to be updated. Perhaps the electrical service hasn’t been upgraded. This would be a problem if you have modern electronics which draw a heavier load on the wiring. There also may not be as many outlets.
Additionally, pipes may need replaced. Over time, galvanized piping may have rusted. Whether it’s asbestos insulation on your furnace pipes or lead paint on the walls, older homes also may contain dangerous materials. The basement may not be waterproofed, and you might get water when it rains. And those mature trees you love in the yard may have invasive roots which could have damaged the exterior underground water and sewer pipes.
In an older home, rooms are often smaller and have less storage space. If you were to decide to add on, you might run into code violations and construction problems which would require additional money to update.
The bottom line is if you do decide to buy an older home, be sure to have it inspected so there are no surprises.
IN CONCLUSION: It really comes down to your taste and your economic goals. Evaluate the homes, both new and old, you view in the areas of taste, such as function and aesthetics, and in areas of economics, such as initial cost, maintenance cost, location and energy efficiency. Also consider the investment and how it may increase in value over time. Then, choose a home you like which suits you best in those areas.
This information is being provided as a courtesy for those considering buying a home. Be sure to consult professionals for legal, financial and real estate advice.