Purchasing a home is a big decision that involves exploring various options such as the type of ownership, the kind of property and last but not least, the budget. Buying a home is exciting, but it can also be stressful especially if you are not familiar with the process and associated costs. For the first time or second time home buyer, you can either go with a New home purchase or can go with a resale. Both new homes vs resale homes have their own sets of advantages and disadvantages.
The biggest factor when purchasing a home is Cost and there is a sizable gap between the price of a newly constructed home and that of a resale property. Here we discuss the Pros and cons of both New Construction or Existing Homes.
New homes are typically built on the outer boundaries of the city which makes them far off and therefore commute times can be longer if you are working in downtown or other neighboring cities. Newer localities has limited access to public transportation and therefore your daily drive can be long and expensive. Homes in cities that have little room for expansion tend to be more valuable than those in cities that have plenty of room. For example, areas in downtown Toronto are far more expensive than outer Toronto area even though they are much smaller in size. Plans for schools, hospitals, public transportation, and other public infrastructure can dramatically improve property values in the new areas.
Repairs and Enhancements
A newly built home requires less maintenance since everything from appliances to the HVAC system and roof are brand new. This means you can better predict monthly homeownership costs, since you’ll likely spend less to maintain your home.
Brand new homes come with active warranties and your choice of floor plan which can be customized. Rooms in new construction homes including bedrooms and bathrooms tend to be brighter, with lots of natural light saving you valuable energy.
A resale home purchase can lead to inherited repair issues but Luckily, a Home inspection can prevent this problem from plaguing you. Home inspections are a critical piece of the home buying riddle because not only can they help you uncover repair potential problems, but can help you address them in a timely and efficient manner so you can get these addressed before moving into your new home. A home inspection clause home should be a must for every resale home. This condition gives the buyer the right to have the home professionally inspected by a certified home inspector to evaluate the house that is being sold. The house must pass the inspection for you to proceed on with the purchase and you have every right to get that fixed the problem or can cancel the transaction. You can also add a cost-of-repair contingency if you are really interested to purchase the home.
Both new homes and resale homes with their own set of advantages and disadvantages. New homes are expensive and don’t always have higher-quality features than older homes. The builder also sell the home on list price with minimum basic features and you might to spend a fortune to upgrade several items like Hardwood flooring, upgraded Kitchen Cabinets, bigger windows, closet shelving and more. All of these things can not only add up cost of purchasing a brand new home. New-construction homes tend to come with higher property taxes as compared to resale homes or similarly sized older properties in the same neighborhood. Construction delays are a common practice and can lead to several issues for buyers especially if you are planning to sell your old home and moving into a new construction home.
New homes on the other hand are untouched and repair free as they come with Warranty by Tarion. You are entitled to warranty coverage up to a maximum of $300,000 for most types of claims covered by the one, two and seven year warranties. There is a maximum of $15,000 for warranted damage caused by environmentally harmful substances or hazards, and a maximum of $25,000 for coverage of septic systems. You won’t have to worry about the typical costs of homeownership for the first several years. New homes comes with latest and upgraded home appliances and systems that are also backed by manufacturers’ warranties. New homes usually are well-insulated due to better windows, more efficient heating and cooling equipment, and greater use of insulation.
Both new and resale homes come with their own set of pros and cons. It’s all about what really suits your need and budget. Check out similar article on Move-in-Ready vs. New Construction Homes