New homes versus pre-owned homes, what’s the difference?
Friday, August 15th, 2014
Issue 33, Volume 18.
Times have changed and due to all of the new housing that was constructed before the crash in the economy in the latter part of the last decade. New tracts of homes seemed to sprout up so quickly, that I would joke that all you had to do was invest in a box of toothpicks and plant them in a field and new houses would magically grow. Well, it appears as if there are new boxes of toothpicks being planted as new housing is once again rising from the once rolling hillsides of Southwest Riverside County.
The question is – Why buy a new home when there is such great inventory of pre-owned homes?
Buying a home is one of the most personal decisions you’ll ever make and deciding between new and current inventory is one that you must answer for yourself. Some want nothing more than brand new and being the ‘first’ to occupy a new house while others want the charm with the character and history of a home built years before. Of course there are other factors at work as well, including price, location, lot size just to name a few. Let’s take a look at some of the pros and cons of buying new or previously owned housing.
Advantages of pre-owned homes
Availability – Negotiate a purchase, close escrow and move in – typically not much more than that. You can be in your new home in as little as 30 days after you first walk through it.
Style – There are many styles of current housing inventory available in a relatively small area. One, two and even three story homes are available today in Temecula.
History – Every homeowner selling a home knows the history and as a matter of law every defect and issue must be fully disclosed.
Craftsmanship – Not that there are many mid-century and older homes in the region, but regardless of the exact age, most older homes were built with timbers from old growth forests and the people who built them were old school craftsman who built a home to last.
Mature Landscape – The older the home, typically the more mature the landscape. It’s pretty hard to move into a new home and expect a shade tree to filter out the afternoon sun from beating down on your home.
Established Neighborhoods – In an established neighborhood, it’s pretty much what you see is what you get. You don’t have to worry about the new home salespersons vision of this wonderful utopia becoming fulfilled in your lifetime. It’s not likely that zoning changes will take place.
Disadvantages of pre-owned homes
Maintenance – In older homes the unforeseen is bound to happen. Systems are outdated and wear out. They just require more effort (and budget) for regular and unforeseen maintenance.
Need Updating – The older the home the more likely you’ll end up updating the plumbing, electrical or HVAC systems. Many of the older systems in homes just are not compatible with the technology available today.
Remodel – Many times the new homeowner wants to modernize some of the features, such as the kitchen and baths – this can be very expensive.
Energy Efficiency – In today’s age, the cost of electricity continues to increase, there is a draught and water shortage and older homes often fall short when it comes to energy efficiency.
Storage – Most older homes don’t have walk-in closets and there is limited storage throughout. Even the garages are smaller.
Price – In some cases older homes will cost more. Add in the value of being close to schools, shopping and cultural centers and even public transportation and easy freeway access and you can understand why newer larger homes in outlying areas will cost less.
Size Matters – Most older homes are going to be smaller than the colossal homes being built today
Advantages of new homes
Make it Unique – There are many options (most with a price tag) that new home buyers get to choose from flooring, cabinets, counter tops, electrical and plumbing fixtures right down to the color of the wall paint.
Energy Efficiency – New homes today are built to the latest UBC building standards that mandate the efficiency levels of all phases of construction.
Low Maintenance – The material used in homes today, such as composite woods on the exterior, are engineered to reduce maintenance.
Wear and Tear – New homes won’t have any problems with the wear and tear the previous owners put the house through. Why? Because it’s new!
Modern Features – New homes will typically all be built with the features today’s homeowner wants…even demands. No longer will a consumer buy a home without a dishwasher and built in micro-wave. Today (here in Temecula Wine Country) you can even find new construction with built in wine-coolers! Other amenities we tend to take for granted may include a media room, master en suite, Jack-n-Jill baths and even an in-home workout room.
Warranty – All new construction will have a one year home warranty and ten years covering all of the major systems in the home – hard to beat protection like that.
HOA – While some may object to having another level of bureaucracy in their lives, HOA rules and regulations have a long-term effect of keeping property values high – after all, who wants their neighbor to paint their house sunshine yellow?
Disadvantages of new construction
Negotiations – Builders are funny in that they typically will not negotiate the price of a new home – at best work hard for some sort of perk that at least makes you feel like you got something extra…but it probably won’t be much.
Cookie Cutter Neighborhoods – Not only are all of the homes a variation of 3 to 5 models, the landscape is nearly identical on every lot. This of course, is a matter of personal preference – a complete turn-off to some and reassuring to others.
Lack of Character – It’s hard to argue that older homes have character and newer ones lack it. If you want any of the old-word charm or architectural elements, then you’ll have to spend the money (and time) and add them yourself.
House Settling – Over the course of time, all houses will settle. Expect to find cracks in door frames, the foundation and exterior walls. You may even experience cracks throughout your new tile floor (you may want to wait a year or two before you tile the entire ground floor).
HOA – While an HOA is an advantage, it is also a disadvantage. The dues can be expensive and you need to seek permission, every time you want to do something with your property.
Landscaping – Most new homes come with very basic front yard landscaping and none in the back. You’re looking at putting in your own sprinkler system, drains, sod, concrete and any plants you want. Don’t forget, if you want a patio cover, outdoor kitchen or even a pool/spa –you have to put it all in yourself – and these items never recoup what is spent on the resale.
Commute Time – Newer homes are typically further from the freeways and further from the centers of commerce where most jobs are located. Prepare yourself for ‘rush hour’ commuting.
As you can tell, there are both advantages and disadvantages to both new and pre-owned homes in any market. It’s up to you to decide what you want and what you can afford. The key to locating any home for you and your family is to seek the services of a professional local REALTOR® who knows and understands the nuances of the local market. And yes, use the services of an outside REALTOR® when shopping for a new construction home as well. Remember, real estate is localized; your REALTOR® should be too.
Call us today and get the information you need to make the right decision. The info is free, call now (951) 296-8887.
Questions regarding available inventory and/or other real estate matters please contact me, Mike@GoTakeAction.com. Mike Mason, Broker/Owner of MASON Real Estate Cal. BRE: 01483044, Board of Director of your Southwest Riverside County Association of Realtors® (SRCAR), Traveling State Director, California Association of Realtors® (C.A.R.).
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