Build Idaho | 2020 BOISE IDAHO REAL ESTATE BLOG
New Construction or Existing Home? Which One Should You Buy? Main Treasure Valley Life

Buying a home is a major life decision. But does it make more sense to move into an existing home in an established neighborhood, or build a home in a new subdivision? Here is what to consider.

Around the country, there is a home buying frenzy that is exacerbating the housing shortage and driving up home prices. Boise is far from an exception. It’s very common to see multiple offers on a home and building lots are being bought as soon as they are listed. But is building a new construction home or buying an existing home right for you and your family? It depends on your needs and financial standing. Here are the differences.

Buying a new construction home

Pros:

  • New homes are more efficient: Using new appliances and better building materials for roofing, windows, doors, and walls add up to significant savings over the life of the house. Many of these materials have Energy Star ratings that prove how they are more efficient and are better for the environment.
  • Lower maintenance: New things don’t break down. And if they do, they are under warranty and can be replaced for free. In addition, leaky faucets, old paint, old insulation and other maintenance projects don’t have to be on your radar since everything is brand new.
  • Set purchasing cost: When buying a new construction home, you pay the builder for the cost of the lot and the building materials. This means that if you are quoted $543,000 for the home, that’s what you pay.
  • Customization on the high end: Building a high-end or luxury home allows you to pick nearly every facet of the house: from flooring, to countertops, to appliance finishings, to room shape. This allows you to build a dedicated home office, multipurpose room, and RV garage.
  • Brand new subdivision: Many newly developed subdivisions have amenities to help homeowners have the best experience living there. Parks, pools, clubhouses, sports courts, and ponds are part of the community’s planning and development, and help give residents fun things to do and increase their enjoyment of the subdivision.

Cons:

  • Little to no customization on the low to mid-end: Building a starter home or some mid-range homes are done mostly by production builders who have set floor plans to choose from. These homes are built in a shorter time period than a fully custom home, but you have much less to customize
  • Housing shortage effects: At this point, building lots are getting reserved and bought as fast as they are getting listed. If you are set on buying a new construction home, be prepared to act as soon as you see a lot in a subdivision you want to live in. If you wait, someone else will get it first.
  • Building timeline: Building a home takes between 8-12 months depending on the size of the house, adverse weather, materials used, and the COVID-19 pandemic. Keep this in mind when buying new construction. You basically have to buy a home, then wait a year to actually move in and start living in it; versus buying an existing home and moving into it in a few weeks to a month.

Buying an existing home

Pros:

  • Established subdivision: Many people like purchasing existing homes because they are in established residential areas. These subdivisions have mature landscaping, are closer to city centers and large employers, and the homes are usually in good condition thanks to HOAs. Many established neighborhoods have seen steady value increases over time, which leads to overall prosperity and homeowner satisfaction.
  • Negotiation: When purchasing an existing home, buyers have the ability to negotiate on the sale price in order to get the best deal possible. The result is getting a well-cared-for house at a price you are comfortable paying.
  • More flexible moving timeline: Arranging when you move in can be part of the negotiating process. Giving the sellers more time to move out will help your offer stand out, and it gives you more time to get your affairs in order before moving into your new home. 

Cons:

  • Negotiation: The converse of negotiating (especially in a hot market like the Boise area<>) is that multiple offers can be put on a house. Usually with multiple offers, buyers try to outdo the others with escalation clauses, more cash, waiving contingencies and a variety of other methods to stand out and win the bid. This adds another element of stress to the home buying process.
  • Housing shortage effects: Due to Boise’s popularity and the housing shortage, homes for sale are bought up quickly. In addition, home for sale listings in Ada County in August 2020 were down 64.5% from August 2019 (source) This has driven home prices up sharply, with existing home prices rising the fastest across all price ranges.
  • Maintenance: One thing to keep in mind is the age of the house you are buying. As a home ages, appliances and systems start to break down. Fixing the roof, plumbing, foundation, or wiring is expensive and time-consuming. Be sure to check on these systems with a home inspection.

Summary

Buying an existing home versus a new construction home all comes down to your personal preference and familial needs. They each have their pros and cons. Deciding which one to buy takes some soul-searching. If you need help deciding and want to talk about your options in the Boise housing market, call the Build Idaho agents at (208) 219-7683.

 
Posted by AndrewS at 10/3/2020 2:24:00 AM
Account Login   Account Registration
Comments (0)
No comments yet, login to post a comment.

 

Michelle Penick, Boise Idaho Real Estate Agent

How may I help you?
Michelle Penick

818.472.1767
[email protected]
Schedule Tour