The Dilemma Between Buying a Brand New Home and a Resale Home
July 30, 2006 by
Filed under Home Improvement
Yosi Ben Horin asked:
Most of the home buyers are facing a dilemma when deciding to move. They have to choose between two major categories - whether to buy a brand new home or a resale home. There are many advantages and disadvantages to new houses as well as for resale houses. The list of the differences is long, but for a rough comparison, we will list just the most major and bolted ones. A good real-estate agent might also help the buyer to distinguish the differences between those two categories and give a better understanding of the market, in order to reach the right decision that would suit them better.
The first conspicuous difference is that a new house is a new house. Like a brand new fresh car, there is no replacement to the feeling of having a new product that no one has used before and moving in to a new house is like starting a new chapter in life. Furthermore, with a new house, most chances that the buyer will not suffer of any major problems that might occur due to wear of its components and systems (such as leaks, for example). Most people who’s this is a major concern, are not willing to compromise on this issue and initially go on buying a brand new home. Another reason that some home buyers prefer to buy a new home is a financial reason. When buying a house at an early stage, while the construction has not yet started and the development might even be in a late planning stage, most chances are that the price would be attractive comparing to other existing homes with similar characteristics in nearby locations. The simple explanation for it is that in the first few years after the construction has ended; the new neighborhood is being developed, the trees have grew up, the amenity areas, shopping centers, schools, libraries and public transportation are already exist. However, it is not always known from advanced which kind of public services would be in the area and therefore, the buyer has to do self investigation in order to revile those thing, as this information will not be provided at the sales office. A well developed neighborhood increases the value of its houses because the other side of the equation, those home buyers who prefer to buy resale houses, are ready to pay more just in order not to suffer from the lack of basic services until the development of the neighborhood is completed.
On the other hand, home buyers who rather buying a resale house, located in an established neighborhood, have a different priority order. They take into consideration that they might be exposed to future unknown repairs that might appear and therefore they try to minimize this risk by hiring a home inspector. At this point, it is important to mention that a home inspection is not a guarantee that no unexpected problem will pop up after moving in, however, it gives the home buyers a better understanding and more information about the property they intend to purchase. A second point that worth knowing is that most home inspectors are not engineers and cannot evaluate or diagnose structural problems that the house might have. Therefore, it would be a wise idea to hire an inspector who is also a licensed Professional Engineer (P.Eng.) in Ontario. An inspection conducted by a professional engineer might cost more than an inspection conducted by a regular home inspector but this additional expense is negligible comparing to other expanses while purchasing a house and may pay itself in the long run. Nevertheless, buying a resale home has many advantages. For example, unlike new houses, which in most of the cases are sold by the builder with a basic package of upgrading, the buyer of a resale home may enjoy many improvements, which the previous owner has added to the house, such as the developing the landscape, better appliances, upgraded bathrooms and kitchens, upgraded windows ext. All those extra thing, which the buyer gets a part of the property, might cost tens of thousands of dollars and therefore should also be a major parameter in the calculation.
In conclusion, the decision between buying a brand new home and a resale home is tough for most of the home buyers. There are many parameters,which have to be considered before making a final decision. In order to assist with those conflicts, it would be a good idea to prepare a table that lists all important factors that are important for the home buyer. A visual comparison may help organize the buyer’s thoughts and help to reach the optimum decision.
Most of the home buyers are facing a dilemma when deciding to move. They have to choose between two major categories - whether to buy a brand new home or a resale home. There are many advantages and disadvantages to new houses as well as for resale houses. The list of the differences is long, but for a rough comparison, we will list just the most major and bolted ones. A good real-estate agent might also help the buyer to distinguish the differences between those two categories and give a better understanding of the market, in order to reach the right decision that would suit them better.
The first conspicuous difference is that a new house is a new house. Like a brand new fresh car, there is no replacement to the feeling of having a new product that no one has used before and moving in to a new house is like starting a new chapter in life. Furthermore, with a new house, most chances that the buyer will not suffer of any major problems that might occur due to wear of its components and systems (such as leaks, for example). Most people who’s this is a major concern, are not willing to compromise on this issue and initially go on buying a brand new home. Another reason that some home buyers prefer to buy a new home is a financial reason. When buying a house at an early stage, while the construction has not yet started and the development might even be in a late planning stage, most chances are that the price would be attractive comparing to other existing homes with similar characteristics in nearby locations. The simple explanation for it is that in the first few years after the construction has ended; the new neighborhood is being developed, the trees have grew up, the amenity areas, shopping centers, schools, libraries and public transportation are already exist. However, it is not always known from advanced which kind of public services would be in the area and therefore, the buyer has to do self investigation in order to revile those thing, as this information will not be provided at the sales office. A well developed neighborhood increases the value of its houses because the other side of the equation, those home buyers who prefer to buy resale houses, are ready to pay more just in order not to suffer from the lack of basic services until the development of the neighborhood is completed.
On the other hand, home buyers who rather buying a resale house, located in an established neighborhood, have a different priority order. They take into consideration that they might be exposed to future unknown repairs that might appear and therefore they try to minimize this risk by hiring a home inspector. At this point, it is important to mention that a home inspection is not a guarantee that no unexpected problem will pop up after moving in, however, it gives the home buyers a better understanding and more information about the property they intend to purchase. A second point that worth knowing is that most home inspectors are not engineers and cannot evaluate or diagnose structural problems that the house might have. Therefore, it would be a wise idea to hire an inspector who is also a licensed Professional Engineer (P.Eng.) in Ontario. An inspection conducted by a professional engineer might cost more than an inspection conducted by a regular home inspector but this additional expense is negligible comparing to other expanses while purchasing a house and may pay itself in the long run. Nevertheless, buying a resale home has many advantages. For example, unlike new houses, which in most of the cases are sold by the builder with a basic package of upgrading, the buyer of a resale home may enjoy many improvements, which the previous owner has added to the house, such as the developing the landscape, better appliances, upgraded bathrooms and kitchens, upgraded windows ext. All those extra thing, which the buyer gets a part of the property, might cost tens of thousands of dollars and therefore should also be a major parameter in the calculation.
In conclusion, the decision between buying a brand new home and a resale home is tough for most of the home buyers. There are many parameters,which have to be considered before making a final decision. In order to assist with those conflicts, it would be a good idea to prepare a table that lists all important factors that are important for the home buyer. A visual comparison may help organize the buyer’s thoughts and help to reach the optimum decision.