Strategic Points Group: Buying Homes: 4 reasons to buy a new home over a resale home

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I'm sure you could probably come up with more than 4 reasons. Builders could certainly fill a book with reasons to buy new instead of resale. I will only cite of few of the most important ones so that those home buyers that are literally up for grabs and are trying to decide for themselves.

Appreciation
Residential real estate experiences a life on its own, similar to the growth of an individual, many experts agree. The first five to seven years are usually its "formative" years, where the most appreciation can occur. It is during this time that a new home can have the most appeal, and appreciate with its surrounding area and economy. The second stage may be referred to as the "maturing" period. This can extend into year 15 or so, and may find the now "not so new" home stabilizing in terms of appreciation. This is when depreciation can add to the equation. The home's features and trappings can begin to look "dated" and some items may need to be replaced, such as A/C, roofing, flooring, carpeting, etc. Keeping up with these items as the years go by may help buyers hang on to a good chunk of the original appreciation from its first few years. However, a few buyers willing to invest in updating their homes in a given neighborhood may not be enough to convince an appraiser that the entire neighborhood is as concerned with keeping the values up.

Years 15-30 are sometimes referred to as the period of "built-in obsolescence". By this amount of time home builders have so significantly changed features, energy efficiency, and floor plans to suit the buying public's emerging lifestyles that a major re-model of an aging home may need to take place, should the occupants be interested in getting top dollar for their home. Appreciation becomes an issue primarily when selling or refinancing your home. Neither of these issues are usually of significant importance to those wishing to stay put through retirement, have a tolerable interest rate for their home loan, or own their homes outright. Without knowing the future, it is difficult to tell when homeowners may need to sell, accept employment relocation opportunities, or decide to downscale as their families grow up and move out. This is why homeowners tend to remain concerned with their investments in terms of appreciation and future value.

Warranty
New homes carry better new home warranties as products improve and builders feel increasingly confident in them. The first two years of a new home warranty may cover almost everything from carpeting, to air conditioning systems (heavier on the first year) and the first ten years usually carries a required ten-year structural clause. Structural problems in a house can be the source of many problems, but I prefer to liken the idea of a structural problem to a picture one can conjure up fairly easily. Imagine you are standing at your entry, and one foot literally feels to be on higher ground than the other. Looking down, you see a ridge in your floor as if an earthquake may have happened under foot. This is a structural problem. This can be caused by a number of reasons, ranging from erosion of the grading of your property, to the shifting of cobble beneath the structure. A concrete slab which may not have been up to snuff may require the builder to hold its concrete sub-contractors feet to the fire to repair the slab if it is within its warranty period. (Raised sub-floor carries some different issues) Dealing with issues like this, as most would agree, can be a nightmare. When a home is past its first decade or so, recourse to address problems such as this is difficult to pursue, and you may literally be out thousands of dollars when all is said and done to fix it. Although real estate laws have been progressively designed to help protect the consumer, with disclosures abounding in real estate contracts throughout the country, "caveat emptor" (let the buyer beware) remains inherently implied in buying real estate. A new home buyer is simply more informed about his new home community and structure because of the amount of disclosure builders are required to supply, that there may indeed be lessened risk-taking in buying a new home today.

Better product
Up to date technology in new construction, more and more timely inspections required by city and county entities, and features that reflect consumers' changing needs and desires are showcased in new home construction. Builders want protection from defect litigation by enlisting suppliers who help eliminate warranty work.

Requirements to increase energy efficiency by local utility companies literally force builders to find new and better ways to lower your utility bills and save the environment. Many new homes are now equipped with dual-paned "low-E squared" glass, likened to putting sunglasses on a new home, providing more energy efficiency and less fading to furniture, cabinetry and carpeting in brutal sun-lit areas. The newer vinyl frames are less prone to leakage from moisture and air, provide more noise abatement, and even glide more easily than aluminum or wood frames. Innovations such as these in new home construction help contribute to a lower budget for utilities, less frequent home repairs, and more peace of mind in the future. Innovations in insulation, trusses, and concrete continue to be showcased at major builder conferences nationwide, adding to the appeal and quality going into new homes.

Pride of ownership
It's new and it's yours and no one else has ever lived in it. A new home is typically an expression of its first owners. Options to the floor plan, colors and materials chosen to decorate it, and even the excitement felt during the walkthrough with the builder, make up a snapshot of you and you alone. No one else's cooking smells, pet odors, cigarette smoke, or family squabbles ever took place in your new home. The pride taken in fine-tuning a home's trappings and landscaping the first few years adds to its character and fills up photo albums. The neighborhood is filled with people reflecting much of the same pride and concerns for the future of the neighborhood. A natural commonality created by everyone being literally in the same boat at the same time (putting in landscaping, pools, or enhancing their new homes) breeds a rapport unlike established neighborhoods. This is your history and of those around you, taking pride in either your beginnings or your accomplishments. It is a place where Thanksgiving dinners, new babies, the eventual empty nest, and family memories are happening.

Buying a home is, of course, a very special and very emotional decision for most people. Whether to buy new or used will continue to be a topic of discussion for some time, and there hasn't been a better time to buy in the past decade than right now. Interest rates are low, a good economy, and consumer confidence all add to a good feeling about the future, in many buyers' estimations.

In the building industry, however, many professionals will smile when asked why to buy a new home instead of one with previous experience. "Well," they'll smugly reply, "because it's brand new!".

Try these other related FAQ sections:


			New Mortgage

			Refinance

			Home Equity

			Debt Consolidation

			Construction

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