Examining the Pros and Cons of Buying Versus Building a Home
Everybody loves getting brand-new things, especially if the new thing has been custom-made to fit your needs. However, whether it is a suit, a car, or a home, new things that are custom-made are more expensive and usually take longer to deliver. This is an important factor to consider when determining whether you should buy a house or have it custom-built.
A house is a major financial responsibility. Making the wrong decision could affect your budget and the level of happiness you have with your new home. The following are a few pros and cons of building a home versus purchasing one that's already built.
Is It Less Expensive to Build or Buy?
According to the National Association of Home Builders, in 2019, the average cost to build a house was more than $485,000. During that same year, the average cost of purchasing an existing house was around $309,000. This means that purchasing a pre-built home as opposed to building a custom house could save you more than $170,000.
The Benefits of Building a Home
If you take pricing off the table, there are several benefits that come from building a custom house.
Customization: If you build a house from scratch, you can include all the details that fit your lifestyle and personal taste.
Little to no competition: According to the National Association of Realtors, existing homes were only on the market for an average of 22 days in 2020. This means that competition for purchasing homes was steep. Finding a home that suits your needs at a good price is a challenge. However, if you already own the land and you want to build a home on the land you own, you face no competition.
Low maintenance: Custom-built new homes must meet building codes and use up-to-date technology. This means you won’t have major repairs or serious maintenance issues for several years. You will also have the benefit of a homebuilder’s warranty if something were to break.
The Cons of Building a House as Opposed to Purchasing One Already Built
Longer wait times: It can take an average of seven months to build a new house from scratch. This does not include the time for planning or approval. This means you may need to cover the cost of renting an apartment in addition to funding the build for a new house.
Little room for negotiation: Buyers hope they can negotiate the price of a home. With new construction, there is little wiggle room. You will probably get a bigger bang for your buck if you purchase an existing home. You can also choose to renovate an older home too.
More stress: Buying a home can be stressful. Building a home adds an additional layer of stress. You have to buy the land, work on the home design, hire contractors, and so on. You have to do all of that while working within your budget. This takes time and effort, and it brings a lot of stress.
The best way to determine if you should buy a house or build it is to discuss it with an experienced real estate agent. Think about your needs and what you can truly afford. The goal is to find a solution you will be happy with.