To Build or to Buy? That is the question.
I often get questions from friends that are incredulous at the current real estate market. Right now, the most popular questions is “is it better to buy or build?”
Like most things in life, there are pros and cons to each answer. And with home ownership, there’s no right or wrong way to upgrade from your current living situation (unless that involves a payment that you cannot afford, in which I say stay put).
Buying a resale has it’s own perks, the biggest of them being a quick move in timeframe. If you are in a spot where your lease end date is coming up, or if you need to move for a new job, resale works best. There’s also the added benefit that many resales have been maintained and renovated over the years, so there might not be very much you want to change. Maybe you want your children to stay in the same school, and moving to a brand new neighborhood might not keep them there, but an established neighborhood would. Buying a resale allows you to know the neighborhood (crime stats, school info, what the neighborhood is like) before you move in.
The cons with a resale, particularly in this current market, is that there is limited inventory. You might find your dream home and have to bid 30k+ over the asking price to beat out other bidders. Other things like an appraisal gap, less inspection limits, and higher earnest money, can help your offer look best, especially when being presented by an agent, but there’s no guarantee that the seller will pick you as the buyer.
If you have the patience to wait, and the ability to take a slower process, a new build might be the way to go. You can pick out exactly what can go in your new home and where it will be built. No worries about having to tear out the old ugly shag carpet in the basement, and they usually are decked out in the latest and greatest energy efficient toys. It’s also usually cheaper to build, and you won’t have to stress about any bidding wars.
The downside is that you might not know what the neighborhood will be like in 5 years, there might be new schools to consider, and you generally won’t know who your neighbors, but the plus side to that is that all the neighbors will be new like you.
If you’re interested in building, please consult a real estate agent, as they can guide you along the way in things such as resale value, things to watch out for, and possibly negotiate on your behalf. For more information, please reach out to me on the contact us link.
