Is It Better To Buy A New Home Or A Resale Home?
There are many choices to make when you’re buying a home. One of those choices is whether to buy a brand new home from a builder or to find a resale home. There are pros and cons of each plan.
One of the most obvious differences is the shopping experience. It’s kind of fun to go look at model homes. They’re beautifully decorated, music is played and someone has obviously set things up so that people looking at the homes enjoy the experience. You don’t have to drive around a lot, because you can see 4 or 5 model homes in each tract, and often several tracts are built in the same immediate area.
When you look at resale homes, you are usually driving from home to home with a Realtor. Most resales are occupied while they’re on the market, so the current owners are trying to make the home presentable and get out before you arrive. There are a few seller who have learned from the success of model homes and try to copy that by staging their home when they put it on the market. This is far from the norm, though. In the case of a distressed sale, the homeowner may make little or no effort to make the home look nice or to be absent for a showing. In the cases where there are people living in the home, they may not be motivated to stop what they’re doing, make the home look good and leave so you can see it.
Other differences between a private seller and a professional builder become apparent when you choose a home and submit an offer. Builders act more like sales people. Their goal is to sell houses and they know how to do it – by making it easy for you to buy. Builders often put together a team of professionals that makes it easy for you to get a home loan, title insurance and anything else you may need in one place. They may offer special incentives to clear homes out of inventory at the end of the year or when things are slow. Homeowner sellers are personally attached to the home. They might get insulted if you ask for a carpet allowance to replace the carpet that they selected. Also, the cost of repairs, concessions and closing costs may come as a surprise to them. Home builders see these as costs of doing business and they know what to expect. Even the price at which a home is listed may be very different for a resale vs. a new home. Home builders price their product in accordance with the market. They know what their competition is and they stay competitive. Oftentimes unsophisticated homeowner sellers price their homes based on other things, like how much they need to walk away with in order to buy their new home, or how much time and money they’ve put into this house. These factors are unlikely to influence how much you are willing to pay for a home.
One of the obvious differences between a brand new home and a previously occupied home is its condition. New homes are, well, new. They have brand new water heaters and carpet, paint jobs and thermostats. Nothing is going to need to be repaired or replaced any time in the next few years. On the flip side, your new house will need an infusion of cash for landscaping and window treatments right away. You also don’t have to live with the previous owner’s choice in carpet and paint. Many cosmetic features are customizable, so for the price of a new home, you’ll get your choices in counter tops, carpet and bathroom fixtures. Existing homes sometimes come with outdated features or things that are not to your taste.
When a new community is built, it needs infrastructure like roads, schools and fire stations. The money for these things comes from property taxes on the new homes in the area. This means that the property taxes are going to be higher on a new home. This is sometime called a Mello Roos tax.
Neighborhood is a key factor in selecting a home for your family. A resale home is in an existing neighborhood that already has characteristics. Do the homeowners have block parties every month? Is it a quiet street? Are there kids the same age as your kids? Is there a neighbor who has frequent disagreements with other homeowners? Are the schools good? If you’re looking at resale homes, you can look at these neighborhood factors to determine if it’s a good fit for you. A new home in a new subdivision is like a clean slate. All of the new buyers will determine the personality of the new neighborhood.
Most home buyers look at some new homes and some resales before making a final decision. Being aware of the pros and cons of each option will help you make the right choice for your family.
If you live in Southern California, be sure to see these new homes in Chula Vista.
