Are New Homes Actually Cheaper than Used Homes?
Buying a home is a big decision. You want to account for everything. The first question you’ll need to answer is whether you want to look at new homes, or used homes. A new home builder can build your home to your exact needs and wants. A used home might cost less at first, but are there hidden costs to owning a used home?
On Energy Efficiency
If you want to be mindful of your environmental impact, new homes will tend to be better at that. Additionally, the energy savings can be out of this world. New homes built today have much higher standards for energy efficiency, even from just a few years ago. Many new homes even come with energy certifications covering your walls, roofs, windows, and doors.
You could retrofit a used home to improve your energy efficiency, but it won’t ever be as efficient as a new home build to current standards. As well as being less efficient, retrofitting a used home can be wildly expensive. In addition to better energy efficiency from the start, new homes usually have better air filtration. This will make life better if you suffer from asthma or allergies.
When you’re buying a used home, you get what you get. The room layouts, the lighting, and the ceiling heights are already in place. You’re also stuck with the wiring, and where the outlets are. However, when considering new homes, you can be a part of the design of the house.
With new homes, you may have the opportunity to customize your wiring to support the high-speed electronics and internet you’re planning to have in your new home. The cost of overhauling your wiring in an old home is far too high to be practical.
But What Kind of Cost are We Talking About?
With a new house, everything is new. This means you won’t need to spend extra money replacing this equipment. Additionally, most of the equipment in new homes comes with a warranty, protecting you from the hassle and expense of replacing aging equipment.
So, what are you looking at spending if you replace these pieces of equipment?
- Most furnaces have about a 20-year life span, while central AC lasts around 15 years. The AC runs around $4,000, and the furnace is in the ballpark of $3,600.
- Whatever flooring you’re going with, you’re probably going to have to replace at least some of it in a resale home. This can run anywhere from just a couple thousand dollars, to more than ten thousand dollars.
- Your average shingled roof has a life span of 25 years. Replacing your roof could cost five thousand dollars or more.
- Unless you can get lucky and find a house with the color you want, you’ll probably want to repaint it. A professional paint job could be yet another five thousand or more.
- Just like your exterior paint, you’re probably going to want to repaint the inside of your house. Even if you do this yourself, you’re still going to spend time and money finding the color you want.
- Kitchen remodeling could cost as much as $40,000 or more depending on your design.
- Bathroom remodeling could cost $15,000 or more.
While you’re the one in charge of your spending here, you’re probably going to spend money on at least some of these capital improvements. These are costs are hidden when you don’t buy new homes.
New Homes Have Better Safety Features
Particularly in terms of fire safety, new homes are built much better. New homes usually come with fire retardant material in the carpeting, as well as the insulation. This isn’t something you’ll find in a resale home. Most new homes also have hard-wired smoke and carbon monoxide detectors, which means you won’t need to rely on less reliable battery-operated detectors.
What about Financing?
Many builders can help you customize your financing. They can set the down payment, “points”, fees and interest rates based on your circumstances. You can even get help defraying your closing costs at settlement. While you’ll probably get to know the seller of a resale home, you can be sure they’re not going to have their own mortgage company.
So Why Do People Buy Resale Homes?
There are a few reasons to buy a resale home instead of new. Even if the resale home needs work, if you have your heart set on a specific neighborhood, or a close-in suburb, the only way to get a new home is often to tear down a used home and build a new one on the lot. Another good reason to buy a resale home is if you’re a serious do-it-yourselfer, but you have to be ok with the time and money commitments that will be required.
As covered here, you can see that buying resale homes are cheaper than new homes up front, but may cost more overall. If you’re not trying to move in to a specific neighborhood, or don’t want to take on a big project, you should definitely consider new construction homes.
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This post was written by Chetty Builders