When buying a new house, one of the first decisions you’ll make is whether to buy a resale property or a pre-construction home. Each has its own set of pros and cons and what’s right for you will depend on your unique tastes and needs.
Buying a new home is exciting – But it can also be overwhelming to narrow down what you’re looking for. Choosing to purchase resale or new is the perfect place to start when crafting a list of needs and wants.
Is a Resale Home Right for You?
Often times, resale homes are less expensive than pre-construction homes, and there is more room to negotiate. You move into an already built home in a developed neighbourhood, with everything ready to go.
Pros of Resale Homes:
- Typically less expensive than pre-construction with more opportunity to negotiate the price
- More desirable locations (particularly in urban areas short on space for new builds)
- Neighbourhoods are more established with known dynamics
- Known proximity to schools, shopping, and community amenities
- Generally, more character and space compared to modern designs
- Potentially lower tax profile
Cons of Buying Resale Homes:
- Tricky to narrow down your ‘perfect home’ with everything you need (you might have to compromise)
- May require extensive repairs and/or renovations to make it your own
- Unless updated, fewer amenities and older appliances than in new builds
- Competition could be high with other buyers in the market
- Older homes may mean surprise repairs pop up
Will You Opt for A Pre-Construction Build?
If you want a customized, brand-new home, pre-construction might be right for you. One of the main advantages of purchasing a new build is the degree of personalization. You can choose finishes to ensure you get a look you love for a space all your own. And, with a brand-new home, you can bank on not having major repairs for the next few years.
Pros of Pre-Construction:
- A pre-construction home is a version of that new car smell!
- Brand new construction with active warranties means fewer repairs in the first few years
- Customizable floor plans so you can tailor the space to your needs
- Cost of upgraded features can be folded into the mortgage
- Green appliances with the latest technology allow for better energy efficiency
- Financing may be available through the builder, which could makes it easier to qualify for a mortgage
Cons of Pre-Construction:
- Often more expensive than resale properties
- Might be in an undeveloped area
- Property values are unknown and possibly more volatile
- Pre-construction homes don’t have the same character as older houses
- There will be ongoing construction in the neighbourhood, especially if you are one of the first to move in
- The closing process could be more complicated and longer
- Potentially a greater tax burden
Questions to ask when choosing resale or pre-construction
How much time do you have before you need to move in? Pre-construction homes take much longer to access, and there can be delays during construction that can affect your closing dates. You’ll be able to get into a resale home much faster with a specified closing date.
Where do you want to be? Do you want to be in a specific neighbourhood or area? As a general rule of thumb, finding new builds in heavily populated urban areas is more challenging as there isn’t as much undeveloped land.
What type of neighbourhood do you want to be in? Do you like being in an established neighbourhood, or do you prefer an actively growing community? Pre-construction homes are generally in developing areas. Depending on your priorities, this can be a pro or con. Read more about the neighbourhoods that The David Bradica Team specializes in here.
How much control do you want over the process? When buying a pre-construction home, you have much more control over choosing the design and features of your new space – there are many choices to make. Some consider this a bonus, while others don’t want to spend the time weighing their options.
What is available? Take a peek at the home inventory in your town before you make your decision. Are there new developments within your timeline? Are there many resale homes available? Is buying a lot and building your own home a possibility?
How important is customization? Getting everything you want in a home is usually more expensive than purchasing an already built home. If you are dead set on the exact floorplan and finishes you want, you may want to buy new so you won’t have to compromise on as many details.
What are your priorities? What are the most critical factors in your new home? Make a needs and wants list to help you in your decision. If things like customizing the interior or a specific floor plan are high on your list, pre-construction might be best for you. A resale home might be a good idea if a quick move-in date or a particular community is top of your list.
Making the Decision Between Resale Homes and Pre-construction
Whether pre-construction or resale home, buying a new house is an exciting time! There is no one correct answer that applies to everyone. Take a step back and look at which factors are most important to you. Learn as much as you can about your options and get an experienced realtor on your side to help you make the choice.