For starters … New likely means a higher price and farther out
Apples-to-apples in terms of the basics … ultimate total cost, nature of neighborhood, square feet, number of interior stories, number of bedrooms, number of parking spaces and major amenities, like a swim pool … the “rule-of-thumb” is that new costs 20% more than a comparable resale home that is closely comparable and of the same basic construction.
At a ballpark $500,000 market price, not exceptional these days, that’s ballpark $100,000 for cash to “renovate” a closer-in resale home to exactly the place where you want to live.
Below are lists of some of the choice issues … not even close to exhaustive because every individual is going to be concerned about and focused on different things … and every property is going to have its unique issues. But I believe these make clear that “new” is not necessarily the better choice.
Also, buying a mostly-constructed new home, a “spec” or one that fell out of escrow early that meets all criteria for basics and amenities and that still has interior customization choices to be made, eliminates several of new-home cons … a very “lucky” situation where available … but most of the more important “cons” remain.
|New||Resale … assuming renovation after purchase|
• Higher price
• Smaller lot
• Closer neighbors
• Longer commute
• Sterile nature of “new”
• Six month build-time wait
• Limited customization choices
• Minimal lot landscaping for year+
• Unknown nature of adjacent homes
• Construction zone after move-in until build-out
• Bare streets for year+ - no trees and other greenery
• Unlimited renovation choices – stressful process
• 30 to 60 days renovation build-time
… or live-in mess.
• Uncertain results of renovation
• Uncertain cost for renovation
• Complexities of contracting
• Better energy efficiency
• Better technology
• Better condition
• Larger lot
• Lower price
• Shorter commute
• Well-defined neighborhood
• Definitive, better-known basic product