New Home or Existing- Which Do You Prefer?

By
Real Estate Agent with Utah Homes 9188867-SA00

I have spent a great number of years purchasing homes for resell, or helping my investor clients do the same.

However, I have also spent quite a bit of time with people who are looking for a band new home.

There is something exciting about being the first person to live in the home. You enjoy some nicities, such as:

  • Warranties on every other new thing in the home. Sometimes the builder will even extend the existing warranties beyond the normal time frame.
  • You can attaing that pioneer feeling of being the first to a community or city. I'm currently in the process of living in a town that didn't even exist a few short years ago. The neighbors and businesses that surround us are in the same boat- we're getting to know each other and have the common background of embarking on this space together.
  • You can plant build fresh landscaping and watch these houses turn into homes. Within a few years the trees will be taller and the homogeneity of the place will lessen. Younger neighborhoods simply appeal to a certain percentage of the population.

Are there any disadvantages?

To a certain extent, these are the converse of the above. For instance:

  • You can buy a home warranty for an existing home.
  • Some people prefer seeing an "end result" neighborhood were there are fewer unknowns to the views outside your window. Also, well established business go a long way to creating an extra sense of community.
  • Mature trees and shrubs often contributes positively to that "it just feels like home" quality. Some older neighborhoods have an outstanding curb appeal.

When I work with investors, they often follow a tight plan that can be very similar to the goals of persons purchasing a move-in, owner occupied home. Some prefer condos, others prefer single family homes. Some like to purchase homes on large lots and others want urban dwellings in areas undergoing a gentrification. I also have investor clients who want homes that are as new as possible- often these are the easiest to rent out.

Real estate agents: which do your clients seem to prefer these days? New or existing homes?

Home buyers: what is your preference?

I'd love to find out.

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Winston Heverly 09/18/2015 01:13 PM
  2. Praful Thakkar 02/18/2016 11:12 AM
Topic:
Home Buying
Tags:
new homes investment properties

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Rainer
105,381
Chris Mamone
Mortgage Master Service Corporation - Tacoma, WA
Loan Officer

The market in my area is very unique. There are very old homes in most areas and then brand new homes. So the swing is age and type of structure can vary.

Based on my experiences in the area, I would have to say new homes have a great advantage of reducing the expenses of home ownership due to everything being new and sometimes under warranty. Older homes you often have to replace, fix, or repair areas of the home that can cost thousands in addition to your monthly payment. Buying an older home is about being selective and asking those hard questions of can I afford to fix what I want to fix and still come out ok? or is it better to spend more and get a new place without having to fix so much?

Feb 02, 2015 02:51 AM #46
Rainmaker
286,828
Dana Basiliere
Rossi & Riina Real Estate - Williston, VT
Making deals "Happen"

Decades ago it there was a financial advantage to purchasing new. In this current market (Chittenden County VT) the price of new construction is higher per sf than nice quality existing so times have changed.

Feb 02, 2015 03:46 AM #47
Rainer
14,055
Brad Gustafson

Having sold home in Las Vegas for 18 years, where 50% of the market was new construction & 50% was resale, I explained the choice to my buyer clients as follows:

Consider who you are buying FROM.  When buying a new home, you're buying from the most sophisticated sellers in the marketplace.  They sell home for a living.  They know how to stage a house and make it look it's very best.  

They take the interior doors off and put under-sized furniture in to make if feel more spacious.  They put window trimmings on that don't block any light to make if feel brighter, etc...  Once you move in, it'll never look as good as the model does.

They do everything they can to sell their home for as much as possible.  But they do no over-price their homes because they can't afford to sit on inventory.  So, if you want to get a fair price on a move-in ready house, go for new.

On the other hand, the individual sellers, for he most part, are not so sophisticated.  They typically think their homes are worth far more than the market says.  But, you can find individual sellers that are motivated and/or desperate to sell, so you can find better "deals."

So, if you want to find a nice house, quickly for a fair price, go for new.  If you want to find a bargain, and are willing to spend a lot of time looking, go for resale.

 

18% off my online Udemy.com class:  Task Management: How to Use & Share Checklist on GoogleDocs

Feb 02, 2015 03:52 AM #48
Rainmaker
557,456
Chuck & Lucy Willman UtahHomes.me
Utah Homes - Alpine, UT
Utah Homes

Liane: Really? I wasn't aware of that. Is that a new thing?

Rafi: That is a possiblity. In Arizona many of the foundations on new homes have foundations with additional framing that is under compression which helps keep it sound in the event there could be expansive soil issues.

Hella: Yes, for those who buy in communities that are large and mostly un-built the annoyances of dust and early morning construction crews can be tough.

Ed: I guess the tax issue is more than a California thing.

Feb 02, 2015 05:01 AM #49
Rainmaker
557,456
Chuck & Lucy Willman UtahHomes.me
Utah Homes - Alpine, UT
Utah Homes

Kevin: During the market correction there were entire new home communities that were not worth the price the owners paid. This created painful side effects such as foreclosures and short sales and HOA's that operated on a minimal budget as many homeowners stopped paying. Fortunately homes are less upside down in the past couple years.

Lyn: Hey, thanks for noticing; it's good to be back.

Chris: That's an interesting market condition. There are a few places in my market where there are old homes and new builds in close proximity. The maintenance costs vs the established look seem to be factors that my buyers have mentioned most in such places.

Dana: It appears (based on comments so far) that in the east, especially the north east, new is less economical.

Feb 02, 2015 05:10 AM #50
Rainmaker
557,456
Chuck & Lucy Willman UtahHomes.me
Utah Homes - Alpine, UT
Utah Homes

Brad: I agree- if one becomes a new homes buyer's rep, it's essential to learn the difference in the quality of the build. Some home builders can wheel and deal. Certain builders throw in more upgrades in their basic model. It's also good to realize that the builder will want to move homes that are "quick move-in". These are homes that are already built or close to finished. In many instances those are homes that someone qualified for at build time but no longer qualify as the move-in date approaches.

Feb 02, 2015 05:14 AM #51
Rainer
51,186
Marilyn O'Donoghue
Long & Foster Avalon - Avalon, NJ

I work in a resort area and most buyers looking at an older house will plan to tear down and rebuild.  As a result of Hurricane Sandy, if you add any square footage to the house, you have to raise the foundation so most think why bother- just build new.

Feb 02, 2015 10:00 AM #52
Rainmaker
557,456
Chuck & Lucy Willman UtahHomes.me
Utah Homes - Alpine, UT
Utah Homes

Marilyn: I wondered what real estate effect Hurrican Sandy had- that's extremely interesting.

Feb 02, 2015 10:25 AM #53
Rainmaker
534,446
Claude Labbe
Real Living | At Home - Washington, DC
Realty for Your Busy Life

It depends on what's available.

New has lots of benefits.  BUT it may be new but not fully to your taste.  It may not be fully in the location you'd like.

Existing...well, it can be tweaked to your taste and may be in the location you want.

The buyer who has time...will find the existing or new, in the location and with the amenities they like.   IF they have time (and the appropriate budget)

Feb 03, 2015 12:12 PM #54
Rainer
436,260
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

It depends on the neighborhood, doesn't it? I wouldn't buy a new development home asking over $1m in an area that has average sale price homes of $600k, although new homes are probably built better than older homes. 

Feb 03, 2015 05:10 PM #55
Rainmaker
557,456
Chuck & Lucy Willman UtahHomes.me
Utah Homes - Alpine, UT
Utah Homes

Claude: Location, at least in my experience, has been a big differentiating force.

Kimo: I have heard of situations like that- where basically you're buying an overpriced tract home where much better deals can be had in the existing home market.

Feb 03, 2015 09:40 PM #56
Rainmaker
712,039
Wayne Johnson
Coldwell Banker D'Ann Harper REALTORS® - San Antonio, TX
San Antonio REALTOR, San Antonio Homes For Sale

Chuck Willman it's pretty evenly divided here for me with clients. Personally, I prefer to buy new homes for my purposes.

Feb 04, 2015 12:49 PM #57
Rainmaker
1,428,654
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

I think you get more for your money buying an existing home (used is not a nice word).  I feel that homes 5 to 10 years old that have been well cared for make good buys.  They have the bugs out of them (hopefully), are priced at market, and are still new enough they are up to date.

Feb 05, 2015 02:10 AM #58
Rainmaker
557,456
Chuck & Lucy Willman UtahHomes.me
Utah Homes - Alpine, UT
Utah Homes

Wayne: Having lived in San Antonio before (I graduated High School there), it has been a while since I've been there. I'd love to see what the market looks like.

Gene: I agree- it's much better to call it an "existing" home.

Feb 05, 2015 06:36 AM #59
Rainmaker
1,673,488
Winston Heverly
Winston Realty, Inc. - Atlantis, FL
GRI, ABR, SFR, CDPE, CIAS, PA

I think going back and reading some of Active Rains best Archives  likes this one should be shared again.

Mar 25, 2015 11:40 AM #60
Ambassador
1,087,800
Celeste "SALLY" Cheeseman
Century 21 Liberty Homes - Mililani, HI
(RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE

Well, on Oahu, there is just so little buildable land (where we have agricultural, preservation, conservation, county, industrial etc)  so the majority of areas that are building new homes are in areas not all desire. Resales here are most likely the best bet....the fruit trees are bearing fruit, the plumeria trees have lots of blooms, the seller had remodeled the kitchen, extended to include a family room (all permitted of course). I have sold a few new builds and the biggest cost was the wall, fence, landscaping, another bedroom, bath etc. pros/cons and definitely the preference of the buyer.

Jul 19, 2015 10:28 AM #61
Rainmaker
617,843
Morgan Evans
Douglas Elliman Real Estate - Manhattan, NY
LICENSED REAL ESTATE SALESPERSON

Here in Manhattan, new construction condos sell at a big premium compared to the majority of re-sale property.  So if you want "new" you will definitely pay for it.  For me, I'm going to be a location based buyer first, I want to purchase a property in my desired location, I can always renovate later to at least make it compete with the newer condos in the neighborhood.

Aug 25, 2015 01:19 AM #62
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Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams fox cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Interesting thoughts, buying a new home never really interested me but you do make some good arguments for them.

Sep 18, 2015 01:40 PM #63
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Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Chuck Willman UtahHomes.me was searching for an answer to my buyer's question and came across this great post agian. Also, re-blogged.

Thanks a lot for making it simple for me, to answer this question.

Feb 18, 2016 11:15 AM #64
Rainmaker
758,060
Troy Erickson
Diverse Solutions Realty www.ChandlerRealEstate.weebly.com - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

Chuck - I think buyers today like new, or "like new" homes where they can move in and have no issues. If they buy a resale home, they want one that has been updated. The biggest difference between new and resale is the price. You can usually get much more home for the money buying resale.

Feb 18, 2016 02:44 PM #65
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