There are many reasons to build a new home but there are just as many reasons to consider an existing home. A person considering a move should carefully weigh the costs and challenges whether to build or buy an existing home.
In Florida, the average time to complete new home construction is seven months. However, that number is somewhat misleading. Seven months is the average time that a developer takes to construct a home for sale. A person who contracts to have a custom home built usually has to wait almost a year and often more.
The single major benefit of the decision to build rather than buy existing is that you will get exactly the home you design. It is not an easy choice, build or buy an existing home. A new home will have the preferred room lay out, garage spaces, interior area and finish. It will also be the preferred location and lot size. The exterior areas will be designed to one’s specific needs and intents. Gardens are placed where needed and a lanai or pool can be just right.
The downside to building from scratch is cost. New construction can be significantly higher than the cost of a similar size, existing home. In addition, with the low cost of mortgages at this time, one may miss out on savings. When building a home, a bank will provide a “construction loan”. This is not the mortgage that an owner will have thirty years later. At the end of construction, this loan is converted to the extended mortgage. It is a gamble that interest rates will be still be low when conversion occurs.
The purchase of an existing home comes with some benefits. If a buyer finds a home that fits their needs and is a good compromise, there is money to be saved. Often, the amount saved can provide funds for remodeling and remain well below the cost of new construction. While the cost of existing homes has crept higher in recent months, it is still well below the cost of new. Using past data, this should continue.
Mortgage interest rates are at historic lows. This month economists predict rates to go even lower for the remainder of 2016 and into 2017. When deciding to build or buy an existing home, mortgage rates gives a strong advantage to the purchase of an existing home.
Suncoasteam Realty wants you to be an informed and educated real estate buyer or seller in SW Florida. Visit our Sales Reports page to view recent home and condo sales in this area or create your own custom report. Find the link: Search sold listings – Create your own custom report to compare prices in SW Florida.
On this page you can enter your own data such as town, size and age of home and features like pool, waterfront, garage, etc. With this tool you will be able to determine recent sale price of similar homes. If you are buying a home, you will know whether the seller is asking a fair price. If you are selling, you will see the price range where you should list. Remember, selling price is what counts. People can ask anything. The price at which a similar home has sold is the real value of any home.