In today’s hot housing market, buyers are likely to consider every available home for sale. And while each home has its unique charms, newly built homes and resale homes come with different upsides and downsides.
As you weigh whether to buy a brand new home or a pre-owned one, here are some factors to consider.
Benefits of new construction
Timing: The time to complete new construction can provide some breathing room when you’re shopping, especially if you’re in a competitive market with compressed deadlines for making an offer on a resale home. The time will vary, of course, but to give you an idea, the average length of time from start to completion for a newly built single family home is 6.8 months. For multi-family homes, such as condos, the average is 15.3 months, according to the U.S. Census’ New Residential Construction survey of 2020, the most recent available.
Floor plan: If you opt for a custom-built home, you’ll work with the contractor to create a traditional or modern layout that works for your life. If you’re hankering for a home office for remote work, they can build it. If you’re buying new construction that’s already been completed, chances are good the layout will lean to modern, with wide-open floor plans. Rooms in new construction homes — especially bedrooms and bathrooms — tend to be larger and brighter, with lots of natural light.
Personalization: Even if you’re not opting for a custom home, you may be able to upgrade finishes from builder-grade materials if you connect with the builder before construction is completed. It may cost you a bit more, but adding your own personal touches may be worth it to you.
Efficiency: New appliances and home systems are more energy efficient. More efficient insulation and windows create buttoned up homes that are less expensive to heat and cool than older models. All of that translates into lower utility bills.
Smart and healthy: “Smart” technology options allow you to automate internet, cable, speakers and even an alarm system. And new homes often use low- and zero-VOC (volatile organic compound) paints and building materials, improving indoor air quality.
Maintenance: 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. Warranties can protect your new home for years before you need to undertake any major repairs.
Amenities: Buying new construction often means buying a lifestyle. Master or planned communities often include amenities like parks and community spaces that are close to schools and transit. The key is finding a builder who offers what you care about.
The flip side
Price: New construction is usually more expensive than a resale home. For instance, the median sales price of an existing home in the U.S. rose to nearly $354,000 in fall 2021, while the median price of a brand new home topped $400,000.
Location: New construction typically grows up in exurbia where land is plentiful but commutes can be longer if you have to go into work. In cities, new construction tends to be high-rise condos or in-fill homes on smaller urban lots, with very little outdoor space.
Landscaping: Existing construction is often surrounded by mature trees that shade the home in summer, protect against wind in winter, and block out traffic noises at bedtime. Mature trees may be salvaged at new building sites but often the landscaping takes years to grow into itself.
Floor plan: Builders, especially in planned communities, tend to stick with exterior design styles and finishes that appeal to the broadest range of customers. You may have to rely on post-purchase painting and decorating to stand out from your neighbors.
Waiting: If you’re looking at new homes that are already built, this isn’t a factor. But if you’re building a custom home or signing up for a home during the construction phase, it could take several months longer than moving into an existing home. The amount of time will vary by market and builder.
If you’re interested in new construction, read about the types of new homes, the steps to building a custom home, and tips for buying a brand new home.