Are you considering buying a new home in a newly developed development? Are you tempted to the sparkle and style of new construction? Are you set to make the move to a newly built house, but don’t know what questions to ask?
buying new construction is significantly various than buying a used house. It isn’t always harder (in many ways it’s easier) but you do need to consider many factors and ask different questions.
With older construction, you need to bring in an engineer to inspect the house and look for defects. Every used house will have problems, and very often the repair will fall on the new housebuyer. From the seller’s angle, their offering it at this price for the condition it’s in; while the condition is not perfect, you’re not paying for new construction.
In other words, they’re charging less for a older home because it needs repairs.
New construction, in contrast, should be delivered in excellent condition. While you will certainly want to do a walk-through inspection prior to closing, the procedure is much simpler. During construction, you can very often inspect the progression of building as it is being completed. If you find something that is an issue, you are able to promptly correct it during the building phase as opposed to going back and fixing it at a later time. Since many repairs and existing homes are the result of the age-such as split foundations, sagging walls, leaky ceilings, and dripping pipes, damaged faucets, broken tiles, drafty windows, lack of insulation, etc., you will have very little of these issues with a newly built house.
While you may surely hire an engineer to inspect a newly built house, they’re usually looking for defects that usually are not present in a new house. Further, since most new homes have a warranty, you have a level of protection you would not have with a old house.
Don’t be misled by the cost of an old house. The asking price is just one piece of the picture. The remodels and repairs necessary to get the house in the way you want can add tens or hundreds of thousands of dollars to the price of that home. Furthermore, you often need to come up with that money “out of pocket.” In contrast, the newly built house is in as good of condition as possible, which is built into the purchase price, and can be paid for with your mortgage.
Let’s look at an example: a new construction in Commack NY that is over 3400 sq.ft. is just over $1 million. The house is in brand-new excellent condition and ready to move-in. A similar “old” house in the neighborhood of the same size could be $950,000. While it may seem that you “saved” $75,000 on a old house, you’re purchasing a house that’s twenty years old, will last twenty years less, and already has twenty years of wear and tear. Since most homes have a useful life of 65-80 years, you’d be purchasing a house with less long term value.
With existing houses, you could need to renovate. The kitchen may need to be replaced, bathrooms replaced, and other repairs made. The used home may not be the exact layout you like. This may require structural changes to the home – which may demand six months of remodeling while you’re living in the house. These remodeling could cost $50-$100,000 and will be money you will need to produce out of pocket. Had you bought the new house for slightly more, you would not need to come up with an additional $75,000 out of pocket, would not need to live free six months of construction, and would have a perfect ready to occupy a home on the day you close.
So does this mean new homes are perfect? No. But generally speaking, they are the better option. When talking about something this size and the scale of the new house, there will always be problems. It is far easier to deal with those problems with a reputable builder during the construction process than it is to deal with them on your own after you have bought the home and have no one to turn to. Items such as a leaky faucet or cracked tile can easily be fixed or replaced by the builder at no additional cost whereas doing the repairs on your own with the used house needs time and cash on your part.
TIP: Be sure to work with a creditable builder in your area who you can turn to with questions and ideas. Try to produce as many ideas as possible at the very beginning of the process before construction; relocating walls after rooms have been constructed can be extremely expensive, whereas moving them before building is started will carry relatively low cost.
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