Today?s real estate market is like no other in recent history. Since the 2007 bubble burst, real estate has taken on unexpected struggles. Lending institutions have placed more restrictions on prospective borrowers making it more difficult to obtain home loans. Property values plummeted resulting in people reluctant to purchase homes until the re-stabilization of the market is in site. However, in recent months it has become apparent that the real estate market has begun to bottom out and lending institutions are again making it easier to borrow money for prospective home buyers. With this good news, home buyers now have the ability to purchase homes at the bottom of the market, potentially saving them thousands of dollars in the future as home values again appreciate. The question many folks have is whether to buy an existing property or build a new home. Both types of properties have their pros and cons, but by building a new home consumers will enjoy higher property appreciation, a more sellable home in the future, and the warranty perks attached with new construction.
When a residential appraiser values a property, one of the first things he/she does is find the year in which the home was built. New homes typically hold a higher value than older properties. This is why new construction is typically worth more than older existing homes. Additionally, new homes will often establish home values in the surrounding area. New homes have a big impact on the real estate market as well as the economy.
In many cities, new construction is the driving force behind the ?up and coming parts? of town. Often times, people are drawn to these types of locations thus increasing the demand for residency. Increased demand, leads to higher prices and more opportunities for perspective home buyers. The old adage is true; it?s all about location!
In today?s real estate market, many home buyers have shown interest in short sales and bank owned property due to low pricing. However, many people fail to factor in the remodeling costs associated with these types of properties. Often the repair pricing can become so expensive that purchasing some properties is unwise. Additionally, it is hard to maintain peace of mind not knowing exactly what type of physical/structural problems you may encounter when purchasing such a property. Often it is difficult to be thorough in investigating distressed properties during a due diligence period prior to purchase. Frequently, problems are only found after one lives in the home for a period of time. By purchasing new construction, you have great benefit of obtaining a one year warranty on the home that protects against any defects. Also, by purchasing new construction, one may have more confidence in the home knowing the integrity of the home is built to the latest building code standards and requirements.
With such a long depressed real estate cycle, pent up home demand is high. Once the home market corrects itself, homes could begin to sell very quickly. Now is the time to decide, what is the most relevant home to purchase in today?s real estate market? One may take a risk on a distressed property or one can have the peace of mind that comes with new construction knowing it will more quickly appreciate in value, be easier to sell in the future, and be free of defects in material and structural workmanship. Please see this link on how to build a house for more information on home building.
Please see this link on how to build a house for more information on home building.
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Source: http://www.mycontentbuilder.com/why-building-a-home-is-better-than-buying-existing/
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