A commonly asked question when house hunting is what the differences are between new and resale properties. “New” means exactly that: a brand new property that has never been lived in or will be built from the ground up. A resale or existing property has been pre-owned.
When it comes time to purchase, there are quite a few differences between the two. Here are a few key points you should be aware of:
New Construction Pros:
- Warranties. Most new home builders will issue warranties with each of their properties. These warranties are typically in three tiers; a one year warranty, two-year warranty, and 10-year warranty. The one year warranty will cover everything that the house came with. The two-year warranty covers major systems like plumbing, electrical, and HVAC. The 10-year warranty usually covers anything structural, like the foundation of your house.
- Updated and Customized. New construction properties are typically built with a more modern aesthetic. This can be a pro or a con depending on your style. Most builders offer a degree of customization, especially if you’re building from the ground up. Some may offer tiers with different floor/paint/counter packages, while other builders have design centers for you to pick out each and every item.
- Energy Efficient. New homes almost always come with energy efficient appliances, and all builders have to build to the city code, which usually leans towards energy efficiency. Things like quality insulation and energy efficient appliances can save you money each month on utilities.
New Construction Cons:
- Builder Contract. New construction properties use a builder contract for sales, which is very different than a resale contract. The builder contract is written to give every advantage to the builder, and no “outs” for the buyer. Give Homespace a call before touring a new home community so you can understand the contract before getting locked in!
- Location. In order to build a new home community, builders first have to acquire the land. Especially in densely developed cities, this usually means that new homes are further out from the center of town. If a commute is a big concern, it may be better to find a resale house in your perfect location and renovate it over time.
- Build Quality and Delays. Newer doesn’t always mean better, and that stands true for build quality. The best thing you can do before buying a new build is to check out the builder’s reputation. Read online reviews and ask neighbors who live in the community how their experience was. Some builders take a lot of pride in their quality and hire talented, thorough contractors. Others just want the house built so they can profit from the sale, and the cut corners can hurt you down the line.
Resale Properties Pros:
- Resale Contract. The contract used for existing homes has multiple places to build in protection periods for buyers. Having this time to get a property inspection, re-tour the house, and make sure that your loan finalizes is a huge plus to buying resale.
- Location. Location, location, location. A perk of buying an existing home is that you can choose wherever you want to live. If location is highly important to you, an existing home may be the way to go.
- Aging. Buying an older home has benefits. One major perk is that the home will likely have already done most of its settling. Settling is a natural process that happens as homes age. The weight of the home moves some of the structures in the house and can cause hairline cracks, shifting frames, and some creaks. In most cases, this is nothing to be concerned about, but sometimes settling can cause large cracks, broken plumbing, etc which can point to a larger issue. All of these issues tend to happen in the first few years, so if you’re looking at older homes, what you see is what you get.
Resale Properties Cons:
- Maintenance. While a brand new home comes with warranties, an existing home does not. Any upfront issues with the house will be your responsibility to take care of. Order an inspection to make sure the house doesn’t have any major issues!
- Upgrades. Existing homes will have more quirks and character than a brand new home. Sometimes the quirks and character may not be your taste. You can always change things later, but major updates can be expensive.
As you can see, there are pros and cons to both new construction houses and resale homes. Ultimately it’s up to you and what your preferences are in a new place. If you’re thinking about buying, contact us with any questions!
August 27, 2018