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To Buy and Existing Home or Build New; How to Decide?

Updated: Nov 11, 2022

Families needing a new living space that have decided they need a new home, now face the challenge of deciding whether they build a new home or buy and existing home where they want to live. For those who have never built a home, the prospect of building can be daunting.

There are many factors to consider so discussing them all is not possible here in a single page. What we can do is look at the Build vs Buy options from a 50,000 foot level. With these high-level perspectives you will be prepared to meet with a specialist at Morgan Davonn to dive into the many details.

When you buy an existing home there is always a degree of uncertainty about hidden issues that might not be found by a home inspector or spotted by you. Despite some recent slowing down of the real estate market, it can still be very competitive. When preparing to make offers on existing homes, you must be prepared to make a decision quickly. If this is your path, be prepared before starting the process. Learn about financing and what you qualify for, learn about the neighborhood and consider crime statistics, schools, nearby businesses.

Building a new home has some advantages and will probably cost about the same when you consider the cost of bringing an older home up to current standards and tastes. The primary advantage is that you can get exactly what you want and not have to settle for a home that only “mostly” meets you family’s needs. Your investment of time and number of decisions to make is significantly greater with new home construction. You will also have to learn about construction financing and also be prepared to wait some months for the new home to be built.

When building a new home you will need a construction loan to pay the individual costs as various parts of the home are completed and approved by both the inspectors and the lender. The construction loan is a temporary loan that must be paid off after construction is complete before you are then given a permanent mortgage loan. Some lenders provide the two loans with only one closing and one application, but you need to ask if that is an option for your lender.

The good and bad news about building a new home is that it will be exactly the way you want it. That means you will need plans and specifications that are the result of 100s of decisions you will need to make. If you have never done this before, working with an architect or a project development company such as Morgan Davonn may be the best way to get it done. With the help of your project manager who protects your best interests, the project will take from 9-12 months and can face delays or cost overruns that are outside the purview of your general contractor.

There are many personal rewards and satisfactions in building, but you will need to create a team that consists of your design and project management professional, your contractor and his subs, you,r lender and the local zoning and building officials. With a competent professional orchestrating this process you will get the perfect home with a warranty and many years of maintenance-free enjoyment for you and your family.

Reach out to one of our team members and we will walk you through the building process.

If you opt for an existing home, you will also need a team to evaluate the condition of the prospective new home, prepare the best acceptable offer for the home, and guide you through the process to make sure your new investment meets your needs.

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