Buying A New Home vs. A Resale Home

Buying A New Home vs. A Resale Home

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There are many choices to make when you’re buying a home. One of the first choices you’ll make is which types of homes you look at. Are you looking for a resale home or are you looking at model homes every weekend? There are pros and cons of each plan.

The process of shopping for a home is quite different in these two scenarios. Looking at model homes is so much fun that some people do it just for entertainment. A team of professionals has designed model homes so that viewing them is a pleasant experience. Attention to detail includes staging a home so that it looks welcoming to everyone and soft music playing in the background. You don’t have to drive around a lot, because you can see 4 or 5 model homes in each tract, and often several tracts are built in the same immediate area.

When you look at resale homes, you are usually driving from home to home with a Realtor. The family who lives there is often scrambling to get out so you can see the home. Some sellers have the home staged and vacuum just before you arrive, but that’s not the norm. In the case of a distressed sale, the homeowner may make little or no effort to make the home look nice or to be absent for a showing. In the cases where there are people living in the home, they may not be motivated to stop what they’re doing, make the home look good and leave so you can see it.

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When you select a home to make an offer on, you will notice a difference between and professional seller and a private seller. Builders act more like sales people. They want you to buy, and they’re logical about making a deal that works for you. Builders often put together a team of professionals that makes it easy for you to get a home loan, title insurance and anything else you may need in one place. If sales are slow or if they’re trying to get sales completed before fiscal year end, they may offer special financial incentives to buyers. Homeowner sellers are personally attached to the home. They might get insulted if you ask for a carpet allowance to replace the carpet that they selected. Since they don’t sell real estate every day, some of the costs, such as closing costs and home repairs may be an unwelcome surprise to them. Home builders already know about these types of expenses and simply see them as a cost of doing business. Even the price at which a home is listed may be very different for a resale vs. a new home. Builders study the market and price their product accordingly. They know what their competition is and they stay competitive. Oftentimes unsophisticated homeowner sellers price their homes based on other things, like how much they need to walk away with in order to buy their new home, or how much time and money they’ve put into this house. These factors are unlikely to influence how much you are willing to pay for a home.

One of the obvious differences between a brand new home and a previously occupied home is its condition. New homes are, well, new. They come with new air conditioners and shingles, dishwashers and siding. Nothing is going to need to be repaired or replaced any time in the next few years. On the flip side, your new house will need an infusion of cash for landscaping and window treatments right away. You also don’t have to live with the previous owner’s choice in carpet and paint. Many cosmetic features are customizable, so for the price of a new home, you’ll get your choices in counter tops, carpet and bathroom fixtures. Existing homes sometimes come with outdated features or things that are not to your taste.

New homes in new communities often include extra taxes to build schools, roads, firehouses and other must haves for a new area. This usually makes the property tax rate for a new home higher than that of an existing home.

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Neighborhood is a key factor in selecting a home for your family. A resale home is in an existing neighborhood that already has characteristics. Do the homeowners have block parties every month? Is it a quiet street? Are there a lot of families with young children? Is there a neighbor who has frequent disagreements with other homeowners? Are the schools good? If you’re looking at resale homes, you can look at these neighborhood factors to determine if it’s a good fit for you. A new home in a new subdivision is like a clean slate. All of the new buyers will determine the personality of the new neighborhood.

Most home buyers look at some new homes and some resales before making a final decision. You will be able to make a better buying decision if you are aware of some of the plusses and minuses that go with each option.

If you live in Southern California, be sure to see these new homes in Chula Vista.

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