To build or to buy – that is the question. The competition is fierce when looking to buy a home. This is causing a lot of people to look at new builds.
However, you may not be sure which is the best fit for you. Let’s take a look at some of the major differences between building versus buying.
How Long Does It Take to Build vs Buy a House?
The timeline for building a house is usually misconstrued. People often think building a home means they won’t move in for a long time. However, you might be surprised that the length of time to build a custom home can be less than a year.
In the past, buying a house typically required a few months of searching, followed by 30 to 45 days for closing. But since the COVID-19 global pandemic, the market has dramatically changed.
According to a recent report from Rocket Mortgage, buying a house in 2022 could easily take a year, if not more.
How Much Does It Cost to Build vs Buy?
The cost of each highly depends on the location. A three-bedroom house in Texas, on average, is around $220,161, while a three-bedroom house in Massachusetts costs around $473,000.
The average cost to build a house in the United States is around $284,057 – again, depending on location and what customizations you want to make.
The benefit of building is that you can start from scratch to get exactly what you want.
Pros and Cons of Building a House
Building a house comes with a few main advantages, particularly in today’s market. First, you don’t have to worry about competition. New construction offers you the ability to buy land, whether privately-owned or through property development.
While it may not be as convenient as buying a house that’s already built, it does alleviate months, if not years of stress when it comes to property hunting.
Usually, existing developments will be within communities that are run by a Homeowners Association. These are the people who set and enforce rules and regulations throughout the community for an annual fee.
Unfortunately, this can sometimes mean having more limitations on what you can do. For instance, they may have only certain floorplans you can choose from, or require certain aesthetics such as house colors, trees in the yard, vinyl flooring, etc.
On the flip side, these types of developments usually offer extra amenities you won’t get elsewhere, such as a community pool or a fitness center.
Pros and Cons of Buying a House
Buying a house provides you with the benefit of convenience. Sure, you still have to work with a real estate agent to search for the house, perform proper inspections, and handle all of the closing procedures. But once the deal is done, you’re able to move into your house.
Another benefit is having a mature landscape and community. This means the grass will be planted, plants and trees will already be in place, and you’ll likely be moving into an established neighborhood.
However, this means you won’t be able to customize your house nearly as much. If you want to make changes, you’ll have to pay for renovations or house additions.
Summary
Deciding on whether to build or buy a house depends on two main factors: convenience and cost. You’ll need to weigh your priorities and determine what’s more important to you.
It comes down to what’s best for your specific needs and financial situation. Talk to a real estate agent as well as a few local lenders to find out what your realistic options are before making any major decisions.
