Build, buy new or renovate – what's the best option for you?
When it comes to purchasing your first home, there are several options to consider: building a new house, buying a newly constructed home or renovating an existing property. Each of these options has its advantages and disadvantages – and what works best for one person may not work for another. Here’s what you need to know.
Building a home from the ground up
Pros:
Customization: Building a new home allows you to create a space tailored to your preferences, style and needs. You have control over the floor plan, finishes and materials used throughout the property.
Greater resale value: Newer homes tend to stand out on the market and generally have a higher resale value due to novelty and energy efficiency.
Cons:
Cost: Building a new home can be more expensive, especially if local builders are not focused on starter homes.
Time: From decision-making and managing the project to ordering materials and working through weather conditions – the construction process can be lengthy and may require a significant investment of time.
Buying a new home
Pros:
Energy efficiency: Purchasing a newly constructed home means you can enjoy the benefits of modern, energy-efficient technology and features.
Lower maintenance costs: New homes often require fewer repairs and updates compared to older properties, which can save you a lot of money in the first few years of owning the home.
Cons:
Customization: While you may be able to select some finishes and overall decor, you generally have less control over the layout and design of the home.
Availability: The inventory of new homes on the market does not meet the demand of those who want to buy, making it more challenging to find a property that meets your needs, preferences and budget.
Renovating an existing home
Pros:
Cost: Depending on the scope of the project, renovating an existing home can be a more cost-effective option. United Housing even has loan products designed to help people make needed repairs.
Character: Older homes often have unique architectural features and a sense of charm that can be difficult to replicate in newly constructed properties.
Cons:
Unexpected expenses: Hidden issues or unforeseen repairs can significantly increase renovation or maintenance costs and extend your home’s project timeline.
Limited energy efficiency: Older homes may not be as energy efficient as new construction, which could lead to higher utility costs.
There is no one-size-fits-all solution to homeownership. Weighing the pros and cons of each option will help you determine what is the best fit for your budget. Take the time to research, consult with real estate professionals and explore the housing market to make the best decision for you.
If you live in Memphis, you can start by enrolling in our Homebuyer Education program. The 8-hour course offers information on credit management, qualifying for a mortgage, working with an agent and more. Register today at https://www.uhinc.org/education-counseling.