So, you’re looking at homes and you’ve seen some existing homes as well as some brand-new ones. What are the pros and cons of buying a new home versus an existing one?
There are some great pros to buying a new home. With a new home, you get the newest appliances, the newest finishes, oftentimes great locations and layouts, and that fresh, contemporary feel. These are all important because the person you sell your home to later will also find it appealing.
One thing you want to keep in mind, however, is if there is tax abatement in place that can erode your equity over time. Also, at what point in the sales cycle are you purchasing? If you are the first person in and you want to wait until they sell the last location, sometimes you can make 50% on your money or triple your cash down payment. It is a great investment.
"It is most often the case that an existing home bought at the right price is undoubtedly the way to go."
However, your equity could also be gutted if they have trouble selling the last quarter of the available properties and have a fire sale.
You do not want to make the wrong choice when you are stressed and looking to buy a home and all of these indicators are telling you that it’s a good idea because it’s new and it’s got great salespeople and a nice smell.
Now to look at resale homes. A resale home may or may not have been recently renovated, and it may involve more negotiation, whereas a new home doesn’t involve much negotiation at all. Existing homes, however, are a great way to make the most equity because you can make small improvements to it. Existing homes also have some of the best neighborhoods because they have been lived in longer.
When it comes to investing in your home, the truth is it’s really an outlying occurrence when buying a new home is a better investment. It’s most often the case that an existing home bought at the right price is undoubtedly the way to go.
If you have any further questions about this or are interested in buying or selling, please feel free to reach out to me. I look forward to speaking with you soon.