To build or buy? Here are the pros and cons of both options…
According to Ruben Caginalp, building a home rather than buying one allows you to customize it to your needs, among other advantages. However, construction timelines have lengthened due to material and labor shortages, and this trend is being reflected in rising sale prices. The average price of a new-construction home in January 2022 was $496,900, up from a pre-pandemic $402,300 in January 2020, according to the U.S. Census Bureau.
The cost of building a home include:
- Labor
- Supplies
- Permits
- Architectural drawings and inspections.
You can cut down on expenses if you do a lot of the work yourself and select cheaper materials. Overall, the cost of building a home is largely contingent on how much you choose to spend on the current market value, transportation cost and availability, geographic location and each component of the project.
The costs of buying a home include:
- Down payment
- Closing costs (including lender fees, such as an application or an origination fee, an appraisal fee and any mortgage points)
- Mortgage insurance
- Homeowners insurance
- Property taxes
- HOA fees
- Home repairs or upgrades
One of the most significant upfront costs of buying a home is the down payment, the portion of the home’s purchase price that you pay upfront. In addition, when you apply for your mortgage, you’ll need to pay for a number of services, ranging from appraisal fees to attorney’s fees. These closing costs add up to 2 percent to 5 percent of the amount that you’re borrowing. Once you’re a homeowner, you’ll also be responsible for taxes and insurance, and you’ll need to be prepared for occasional repairs and upgrades.”
BUYING "Pro's"
You will know exactly what you’re getting and can inspect the craftsmanship before you purchase it. Future homeowners can also reject it and move on to another property with no effort.
A Buyer has more control but is more work! There may also be needed upgrades to consider! However, it can be a faster and more convenient process.
BUYING "Con's"
Finding a house that has every feature you desire isn’t easy. There’s a lot of leg-work involved and sometimes confusion and exhaustion. It could mean buying a home that needs updates and unforeseen repairs.
BUILDING "Pro's"
Every detail is customized just the way you want it, from the architectural style to the kitchen countertops.
Ensure your home is built with the best materials and equip it with state-of-the-art technology.
BUILDING "Con's"
The most common issue is staying within the budget. Expect 10-25% over the budget with a month or two in extended time due to weather and other factors. It’s a time-consuming process with plenty of decisions to be made and additional costs that always seem to pop up along the way.
