Is it better to build or buy a home? Depending on the market you are in, it may save you money and time to buy an existing home, rather than build a new one. Richard Fryer, a real estate school president...
Richard Fryer, a real estate school president with 30 years of experience in the field, says that the decision to build or buy a home is a matter of personal choice that is based on what a person, couple or family is looking for in a home. "It depends on the market you are in. Again, it varies from one part of the country to another. There are a lot of people (and especially younger people) who like to have a new home because they want different things than their parents wanted in a house. The eco-boomers, the Gen X, Gen Y and the Millennium generations don't want the same things in the house that the baby boomers wanted," Fryer explains. Personal style and taste comes into play a great deal when it comes to deceiving if it is better to build or to buy. If you like more traditional amenities, chances are that there are many existing homes out there that would best suit your needs. If you like more modern features, it may be difficult to find a home that fits your style, and building a home from scratch may be your best option. "[Many younger buyers] don't want living rooms and they don't want dining rooms. They would rather have a media room and trying to find a house that has the things they look for could be difficult," Fryer explains. If you are particularly interested in having a state of the art home with the latest technology or having a more energy-efficient, environment=friendly home, building may appeal to you as well.
You should also consider whether or not you want to make home improvements. If you want to make renovations on an existing home that you have purchased, you will either need to pay the money up front, take out a home improvement loan or tap into your home's equity in order to pay for the repairs and renovations. If you are building your house from scratch, you can purchase "upgrades" that you can either pay upfront or add on to your monthly mortgage payments.
Another thing you should consider is how soon you want to be moved in. In some higher-priced markets, the turnaround time for buying a home is very quick and you can be all settled in as little as two to three months. If you are building a house, the process will take much longer. Not only is the actual process of building a house is a lengthy one, but there are often long waiting lists for builders. Fryer says that "most builders or production builders are leased a year out. If you ordered a house today, you are not going to get it in less than a year. Some builders are more than that and it's a result of the very high demand situation."
Many people have the idea that if they build a home from scratch, they will have a maintenance-free house. Fryer states that this may not always be the case. "There are...maintenance expenses, even in a brand new house. You are going to have some items that come up periodically that you have to take care of and you have got to be concerned with, are you going to fix it or if you are going to pay somebody else to do it. Are you going to be the person to take care of a swimming pool, or are you going to pay someone else to do that? If so, then there is...the time and expense of doing so. Even though it's not terribly expensive to maintain a pool today, it's something that you haven't had and then there are just basic costs."
