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Your First Home: Should You Buy or Should You Build?

new vs existing home purchase

Now that you’ve saved enough money for your first home, the first order of business is to give yourself a well-deserved pat on the back. Congratulations, you are about to achieve another significant milestone in your adult life!

However, don’t get too carried away just yet. There’s a lot to do to get your new home online.

First off, it is crucial to consider the type of home you want. There are many options from buying an existing home to going for a custom new build, which is all constructed on-site and then there’s also the pre-fab homes, aka modular homes built off-site.

So many options and they all come with different challenges so take your time and weigh up your options carefully. Research online, including property forums, where answers from people who have been where you are will help you decide what type of property to buy. Plus, when you finally decide to put in an offer – make it conditional on a building inspection before signing the contract. See this home maintenance guide so you’re aware of the areas of a home a building inspection report covers.

New vs Existing

Typically, if you are buying a pre-fab home or planning to custom build, beware that it may seem attractive on cost, but it will be hard to stick to a budget, whatever it is. New figures take time and usually cost more due to ‘scope creep’, a term used a lot in the professional world of business for changing one’s mind. Designing a house is tough going, and you will change your mind on what you want.

New constructions also have so many variables that easily bump up the costs unexpectedly and thus make it hard to keep within the initial budget. An obvious challenge with exposed constructions is the weather. Little work can be done when it rains if the building is not sealed – i.e. windows in, roof on, etc.

Another common challenge is the cost of materials and if the products change and you’re in for paying for a more expensive option for one reason or another. Then there’s the compliance costs and other professional fees. Any delay in construction could easily exaggerate the costs of time taken, and before you know it, the budget is blown. There is potentially less opportunity for scope creeps with modular homes, so while they may be more expensive than a custom build, generally, the costs can be locked down.

However if you’re going to buy an existing property there’s the opportunity to negotiate on price. This is favoured by most first home buyers, who are also attracted to the much quicker turnaround time for a first home.

Everything has an expiry date, and there will be parts of the house that need replacement or maintenance. It could also be a good negotiating strategy if something needs immediate replacement at a hefty cost.

On the other hand, newly-built houses are almost worry-free because everything is new and is expected to function correctly and, of course, under warrantee.

So which is better? There is no one answer for all as it all depends on your situation. What hasn’t been covered is buying a new home that’s already been built but has not been lived in. Many new homes are for sale and whole new communities like San Juan Capistrano homes in the cove community. This option gives you a new home without the hassle of having to wait until it’s built and fit for purpose. Good luck with your decision! Whatever you choose to do, there’s always your next home.

Did you know…most of us change homes up to 15 times in our lifetime? It’s true for Americans. However, if you’re in Europe, you’re moving less often – maybe only a couple of times. Staying close to family is the motive of Europeans, so they’re less transient than people from newer regions like America, Canada and Australia.

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While moving house is a big decision so too it seems to unpack as most of us take 180 days to unpack all our stuff after we’ve moved house, so it’s no wonder what to buy is a huge challenge and one not to be taken lightly.

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