Here's a list of the pro's and con's of buying a new home and a previously owned home:
NEW HOMES
Advantages
A properly constructed new home is built to satisfy today's buyers.
Choosing a new home produced by a reputable builder of high-quality properties gives you the peace of mind of knowing that your home asbestos, lead-based paints, formaldehyde, or other hazardous substances. Furthermore, you can rest assured that your new home complies with current building, fire, safety and environmental codes.
A properly constructed new home should be cheaper than a used home to operate and maintain.
Latest technology in energy-efficient heating and cooling systems, modern plumbing and electrical service, energy-efficient appliances, and proper insulation levels.
A properly designed new home won't force you to adjust your lifestyle to its limitations.
New homes have enough wall and floor outlets to accommodate all you high-tech goodies--microwave oven; espresso machine; cable outlets; home-office gear such as computers, monitors, printers, broadband Internet connections and so on.
REMEMBER: New homes are only as good as the developers who build them.
Disadvantages
What you see isn't usually what you get.
You see a professionally decorated, exquistely furnished, beautifully landscaped model home. You buy a bare-bones, unfinished house where nearly everything-appliances, carpets, window coverings, painting, fireplace finishes, landscaping, and so on- is an extra that isn't included in the base price. When touring a model home, ask the salesperson to explain exactly what is and isn't included in the base price.
Prices are less negotiable.
Developers maintain price integrity to protect the value of their unsold inventory of homes and to sustain appraised values for loan purposes. Rather than reducing the asking price, developers might bargain with you by throwing in free extras or giving you upgrades in lieu of price reduction.
On a price-per-square-foot basis, new homes are usually more expensive than previously owned ones.
No surprise. Land, labour, and material costs are higher today than they were years ago, when the previously owned homes were built. And don't forget, you're buying a home without any wear and tear.
New homes in more developed areas are generally built in spots previously considered undesirable or unbuildable.
It's the old "first come, first served" principle. Earlier developments got better sites.
New homes may have hidden operating costs.
Developments with extensive amenities usually charge the homeowners dues to cover operating and maintenance expenses of common areas such as swimming pools, tennis courts, exercise facilities, clubhouses, and the like.
You may have to use the developer's real estate sales person to represent you.
Developers always have their own sales staff and their own purchase contracts. Some developers, however, let you be represented by an outside real estate agent.
PREVIOUSLY OWNED HOMES
Advantages
Previously owned homes are usually less expensive than new homes.
As a rule, people who bought houses years ago paid less for their homes than developers charfe to build comparable new homes today. Furthermore, at any given time, more previously owned homes are on the market than new homes today.
Asking prices of previously owned homes are generally much more negotiable than asking prices of new homes.
Sellers of previously owned homes don't have to protect the property values of an entire development. They typically just want to get their money and move on to life's next great adventure.
Previously owned homes are usually located in well-established, proven neighbourhoods.
With a used home, you don't have to worry about what a neighbourhood will be like in a few years when it's fully developed.
Previously owned homes have been field tested.
By the time you buy a previously owned home, its previuos owners have usually discovered and corrected most of the problems that developed over time due to settling, structural defects, and construction flaws.
Previously owned homes are usually "done" properties.
When you buy a previously owned home, you generally don't have to go through the hassle and expense of buying and installing carpets, window coverings, light fixtures, finishing off the fireplace, planting a lawn, landscaping the grounds, building fences and patios, and so on. (*Unless the home is a major rehab project!)
Buying a previously owned home may be the only way to get the architectural style, craftsmanship, or construction material you want.
What if your heart is set on having plaster walls, parquet floors, stained-glass windows, or some other kinds of materials or craftsmanship that is unaffordable, if not impossible to find in new homes?
Disadvantages
Previously owned homes are generally more expensive than new homes to operate and maintain.
Some previously owned homes have been retrofitted with energy-efficient heating and cooling systems. Even so, a previously owned home with 12-foot-high ceilings will always be more expensive to heat than a new home with 9-foot-high ceilings. By the same token, the older a previously owned home's roof, gutters, plumbing system, furnace, water heater, appliances, and so on, the sooner you'll need to repair or replace them.
Used homes generally have some degree of functional obsolescence.
Examples of functional obsolescence due to outdates floor plans or design features are things like the lack of a master bedroom, one bathroom in a three bedroom house, no garage, inadequate electrical service, and no central heating or air conditioning.
Wonderful previously owned homes are sometimes located in less-than-wonderful neighbourhoods.
You may be attracted to an utterly charming older home in a lousy neighbourhood. Despite how much you think you'd love living in it, don't forget that you'll have to travel through the undesirable surrounding area every time you want to get in and out of your dream home.