Making the Best Real Estate Investment: Buying Existing vs Building
What is a better investment, building a new home or buying an existing one? When we talk to our clients about this topic, we like to discuss not only the financial aspect, but also the opportunity cost of their time and money
The convenience of buying an existing home is you’re able to move in quickly. On the other hand, building can take a year or two to accomplish. If you’re in a hurry, or if you’re not willing to deal with the stresses involved in building a new home, you might want to consider buying an existing home.
Building a new home can be more expensive than buying a pre-existing one, but the benefit is you can design it exactly how you want. If you’re looking at existing homes, you might not find the perfect one. This could lead to you having to do expensive and time-consuming renovations to get the exact home you want. In order to do these, you’ll have to get architects, engineers, and contractors involved. So, given your particular situation, it might actually be more expensive to buy an existing home than to build a new one!
You need to be aware that the financing for new construction loans is different from buying an existing home. You need to talk to a lender about what you can afford and how you can expect to make back your invested dollars. In the end, you need to determine what your priorities are; if you have particular tastes about the design of your home and the size and location of your lot, building might be the best option for you.
If you have any questions about buying, selling, or investing in real estate we would love to help. Give us a call or shoot us an email at any time. We would love to be your real estate resource!