In order to decide whether a new build is right for you, you need to first understand the pros and cons of new builds.
The main advantage is that you get a brand new house never before lived in and built exactly the way you want it. Builder warranties are another benefit to prospective owners as most homes include a comprehensive short-term warranty, — usually 12 months — and long-term structural warranty. Financing incentives are also a plus, assuming you live in the house long enough to realize the gains. Most builders inflate the price of the house to buy down your interest rate, which is a long term benefit to homeowners.
However, buyers should expect to pay a premium for builder incentives, warranties, and buying new which result in a major disadvantage on new builds, cost. In addition to the house being more expensive, remember to account for post-closing expenses. Post-closing expenses include, but are not limited to:
- a patio or deck
- blinds / window treatments
- interior painting, (if you don’t want the entire house the same color)
- a finished basement
- additional landscaping
Generally speaking, new builds don’t have very good resale potential in the short term, especially while the neighborhood is still being developed as you will be competing with the builder. Homeowners, aren’t able to offer the same incentives builders do and also must inflate the price to cover transaction fees, mainly real estate commissions and title fees.
I would only recommend a new build for someone who is planning on staying in the home long-term. The added time will allow an owner to reap the benefits mentioned above and give the neighborhood needed time to mature and appreciate in value.