When buyers are looking for their next home they may decide that New Construction is more desirable than an existing home resale. Wondering what makes them so different besides their built date? Check out this video from our team member Shane Burgman where he describes what the pros and cons are for each and what it means for pricing:
First Let’s Consider the Price
After analyzing 2,400 closed sales from 2018, priced between $200k – $500K and built up to 2017, we found that the median sales price was $300,000. In contrast, when analyzing sales in the past 12 months of homes that were built after 2017, the median sales price was $377,436. To break it down, that means there is a 20% premium on new construction versus pre-existing homes.
Next Consider Maintenance & Warranties
When you buy a new construction home the builder will typically offer a standard one year warranty on the construction. Also, since everything is new, your appliances will all come with their own manufacturer warranties which range in length depending on the appliance – sometimes lasting up to ten years.
When buying a pre-existing home, buyers are typically most concerned with two major items: the roof and the HVAC. The age of the roof can be a deal breaker when trying to obtain insurance, sometimes meaning a new roof needs to be installed before closing or shortly thereafter. If the a/c unit goes out shortly after purchasing, you could be looking at anywhere from $2,500 to close to $10,000 depending on the type of a/c unit needed or the level of equipment necessary for the home and/or your personal preferences.
Of course, there is also the concern about style and taste – most older homes unless recently updated will have certain features that new buyers will want to update. This could be anything from simple cosmetic changes like paint colors but could also include full-scale renovations to the kitchen and/or baths. Kitchens and baths are the two spaces most often referred to when buyers look to renovate.
Let’s Talk Design
With new construction, you can expect a certain design aesthetic to both the exterior and the interior. Newer homes offer a more modern or contemporary look and they also tend to offer more storage space (hello walk-in closets!) and open floorplans. Older properties tend to have lower ceilings, smaller closets or less of them and can be more compartmentalized with smaller defined spaces. Bedrooms and garages will tend to be smaller as well.
As mentioned above, kitchens and baths are going to be much different in an older home. Besides the layout, which will tend to be more blocked off from the rest of the home, you’ll also find more traditional styled cabinetry and finishes.
These are just a few things to consider when debating on whether to buy a pre-existing home or to buy or build a new construction home. If you would like more information on your options and help deciding which is the right fit for you, contact any of us at the Carpenter Kessel Homeselling Team and we will guide you through the process!