Your dream home will have French double doors, a wood-burning fireplace, a fully finished basement, and a private office in the back of the house. Should you just build a custom home? Click through to learn what this involves.
In a perfect world you could have the perfect home of your dreams. Who wouldn't want a brand-new home that no one has ever lived in, designed to their specifications? Perhaps you've always wanted a sunken living room or a huge bay window with cushioned seats or even a spa-style master bathroom, but there are no similar homes in your area. Building is a no-brainer right? Not so fast!
Temptations of Building a Home
Most homebuyers want a brand-new home even if most buyers go for resale homes. Trulia found that all things being equal, more than 40% of homebuyers would rather own a newly built home over an existing one.
At the beginning of the year, the NAHB (National Association of Home Builders) compared the average price of a new home to existing homes. There was a more than $70,000 difference, with new homes costing considerably more. However, many builders will offer you enough discounts to make building tempting.
Besides the obvious benefit of building a new home, like being able to make it exactly the way that you want it, there are many other pros that can be very tempting including:
● Modern floor plans.
● Upgraded features.
● Energy-efficient appliances/equipment.
● Cheaper than a remodel.
● Practically no maintenance/repair costs.
Building today comes with built-in savings. For instance, with newly built homes those energy efficiencies built into the windows and appliances can add up to thousands of dollars off of your energy bill each year. You don't have to worry about undisclosed leaky basements or hidden water-damaged ceilings.
So why isn't every homeowner opting for a newly built home? It's because we have only given you the pluses. Let's take a look at the reasons why you should factor in the cons too before choosing to build a home.
Reasons to Think Long and Hard
Many builders offer big enough discounts to lure you in and make building as cost effective as buying resale, but are they? Often those discounts do not account for upgraded features. You may be shown a model home with everything that you want in your newly built home.
However, that discounted price goes up exponentially when you start adding in the features that you really want. A newly built home will cost between 10% and 20% more than a comparable existing home.
The difference may be negligible on a million-dollar home, but if you are counting on financing and a huge debt burden to buy it, you should take a moment to think long and hard about it. Keep in mind the points below.
● Too far away: Your commute may get ten times longer in order to build where there is space.
● Takes too long: It can take up to six months before you can live in your new home and that's if permits and other delays haven't extended the construction time.
● Finding some place to live: While your home is built, you will need to rent an apartment or a hotel room for six months at least! Are you prepared for that?
Think about all of the things that you want in a new home and search for resale homes first. If certain features are that important to you and worth the extra cost, then go for it.