Pros and Cons of Buying a New Construction Home

February 01st, 2021

Pros and Cons of Buying a New Construction Home

Pros and Cons of Buying a New Construction Home

Pros and Cons of Buying a New Construction Home - New Construction Home Buying Tips!

There are many pros and cons to buying a new construction home and it's important to understandthe whole picture before proceeding. In this article we will dive into all the benefits, drawbacks, and tips we have for buying new construction homes.

In 2019, roughly1.29 million housesbegan undergoing construction in the U.S.

With so many people buying new construction homes it's no wonder there's been a large uptick in construction.

Let's take a look at the pros and cons of new construction homes, along with some tips and tricks to help you out with the home buying process.

Pros of Buying New Construction Homes

The new construction home buying process is quite different thanbuying an existing house. Buying new build homes is popular for a number of reasons, so let's take a look at the advantages of buying a new home rather than an existing home.

Everything is Brand-New

There can be a lot of charm to older houses, but they can also come with a long list of things to repair or things that will need to be repaired soon. When you buy a new construction home, absolutely everything is brand new. This means that you likely don't have to worry about making surprise repairs anytime soon.

In your new home, all of the surfaces will be in perfect condition, the fixtures and appliances will be brand new, and all of the materials are modern. Since you're the first person to have lived in the home, you know that no one in the past has jerry-rigged weird solutions to problems.

Your Home Will Be Built to the Standards of Today

Older homes can have incredible craftsmanship, but older methods of building and installing electrical and plumbing systems can lead to costly episodes of maintenance and repairs.

When you're buying an older house, you're also always running the risk that previous owners have done unpermitted work or that things haven't been brought up to code. This can create a lot of delays and frustrations during the home-buying process. On the other hand, when you buy a new construction house, you know that the builders have followed all of the modern-day codes and energy requirements.

New Construction Home Buying Tips - Construction Worker

You'll Be Able to Customize the House

It's pretty much impossible to find an existing home that has absolutely everything you need. Sure, you can make renovations and additions to existing homes, but there are practical and financial limitations to doing so.

When you're buying a new construction home, you get to customize the house to suit your needs. You won't worry about having to retrofit an existing house with the amenities that you are looking for. Instead, you can have them built right into the house from the get-go.

Energy-Efficient Features

Older houses are typically less energy-efficient than new homes. If you buy a large New England colonial house, it's most likely beautiful and steeped in history, but there's also a high likelihood that it's drafty and more expensive to heat and cool. On top of that, an older house with outdated appliances will end up costing you when it comes time to pay the utility bill.

New build homes are built incorporating the newest technology when it comes to energy efficiency. You'll be able to outfit your home with energy-efficient appliances and technology that helps to keep your monthly bills as low as possible. This will also likely translate into having to do less maintenance in the short term.

New Build Homes Can Be Low-Maintenance

Since everything is brand new in a new build home, from the roof to the HVAC system to the appliances, they require less maintenance. What this means is that you'll be able to more accurately predict how much homeownership is going to cost you on a monthly basis. Your home will also be protected for years with warranties.

Modern Floor Plans

If you're more partial to open floor plans in homes, you'll love the style of new construction homes. These houses are typically constructed using a modern layout which gives plenty of space to breathe and incorporates tons of natural light.


New home developments are frequently located in areas that have all the amenities a modern person could want. If you're looking for an area that has nice parks and good schools nearby, you'll likely find new construction homes that could suit your needs.

New Construction Home Buying - Home Sweet Home

Cons of Buying New Construction Homes

While there are a lot of benefits to buying new construction homes, there are also a number of drawbacks. Let's take a look at the negative side of buying new-build homes to help you determine whether it's the right choice for you.

You'll Want to Vet the Builders

Before you buy a new construction home, you'll want to do as much research as possible on the company doing the construction. Building a home can be a lengthy process and you will be in contact with the builders constantly. It's important that they are people you feel comfortable working with and that you trust.

If you don't vet your builders beforehand, buying your dream home could easily become a nightmare. Not all builders are ethical or concerned with producing a high-quality final product. Without doing your research, you could end up with a house that has a long, expensive list of problems.

The Move-In Date Isn't Guaranteed

It typically takes about six months to build a new home from start to finish. However, there are a lot of different factors that could lead to it taking longer than this. Issues with the building crew, bad weather, material shortages, and many other things could hold up production.

If you have a set timeframe for moving, buying a new build home could end up throwing a wrench in your gears. It's important to have a flexible timeline if this is the route you want to go.

When it comes time to buy a new house, you're likely dealing with selling your previous home at the same time. Check out ourfree home evaluationto learn more about how your home could do on the market.

It Can Get Expensive to Personalize

While it's great that you can personalize and customize your new home to suit your needs, that doesn't mean it doesn't come at a cost.

If you want your new home to have the best appliances, fixtures, and features, then you're going to pay a pretty penny. When you're dreaming up your new home, it's easy to get carried away with what you think you want and need. If you aren't careful, you could end up running the bill far out of your intended budget.

New Construction Home Buying Process Tips

It Can Be Overwhelming and Exhausting to Make So Many Decisions

It's one thing to decide to repaint a room in your house, but it is an entirely different animal to design a home from scratch. There will be so many different decisions along the way that you can start to developdecision-making fatigue. While you might have already made broad decisions about appliances or your HVAC system, it is easier than you might think to get bogged down in decisions about cabinet hardware and light fixtures.

Getting paralyzed by all of the different options in flooring, paint colors, fixtures, features, and little details can end up slowing down the home-building process. If you have a full-time job, as most people do, you could find that the time investment you're spending on online forums finding the perfect shade of grey for the guest bedroom might start to drive you mad.

You Won't Have Much Negotiating Power

When you buy an existing home, there is an expectation that you can renegotiate the sale price after doing an inspection of the property. It is also normal and expected for there to be some negotiation during the initial back-and-forth.

However, you shouldn't anticipate the same type of wiggle room when it comes to buying new construction homes. Since these homes are usually sold by the builder, they have a set price that they are asking for and they aren't normally interested in budging.

There are Design Limitations

It is true that you will have a lot of customizable options when building a new home. However, that doesn't mean you get to create the whole blueprint from scratch.

Builders are most commonly going to have basic designs that they've found are the most appealing to most people. If you're thinking about buying a new construction home, don't expect that you'll be able to have free rein when it comes to the layout and the design.

New Home Builds Are Often Built on Smaller Lots

If your dream home has acres of fields and forests, then you probably don't want to buy a house in new home developments. This is because these homes are very commonly built on smaller lots than lots of existing, older homes. If outdoor space is important to you, you might be better off buying an existing property.

For some people, having a home built on a smaller lot is actually a plus. A smaller lot means you have less lawn to mow and less space to maintain. It can also help you save money on your utility bills, and you won't have to spend your hard-earned free time doing endless yard work.

Additionally, if you don't care much about having a big yard, then a small yard can help you out when it comes to your annual property taxes. Since the size of your yard factors into the value that your home is assessed at, you could end up with a smaller tax bill when you're home is on a smaller lot.

They Typically Use Builder-Grade Materials

Typically, new-construction homes utilize builder-grade materials. While this might sound like high-quality stuff, builder-grade materials are actually pretty cheap. This means that even though your home is brand new, you might find that you're not getting as much value as you had anticipated.

You Can't Be Certain How Much You'll Pay in Property Taxes Ahead of Time

You'll be able to get a sense of how much you'll pay in property taxes when you buy a new construction home, but it will only be an estimate based on how much your neighbors pay. This means that if the town comes back with higher property taxes once your home is built and you're moved in, there isn't much you can do. On the other hand, when you buy a pre-existing home, a tax assessor will be able to give a much more accurate number for how much you'll be set back in property taxes every year.

New Building Materials Contain VOCs

Lastly, another thing to consider is the reality that new building materials contain chemicals, known as volatile organic compounds (VOCs), that are off-gas for a period of time.

VOCs are present in building materials such as paint, flooring, carpeting, and cabinets. When you buy an existing home, these volatile organic compounds have had many years to off-gas. With new construction, it's important to ventilate the home for a period of time to ensure that you aren't exposing yourself and your family to harmful chemicals.

New Home Construction Costs

Building your own house can, on average, cost anywhere between $150,000 and $400,000 according to HomeAdvisor. There are a number of different factors that can impact how expensive this investment is, including the location, the square footage, and the types of materials used to build the home.

It's also important to understand the difference between buying a production build and a custom home. With production builds, developers have already planned out subdivisions with floor plans and lots you can choose from. With a custom home, you are buying the lot and you have full freedom to design and build the house you want.

There are obviously going to be cost differences between buying a production-built home and a custom home. Since there are so many variables that will impact how much building a home will cost you, it's hard to put an exact price on it. As a general rule of thumb, however, you'll pay twice as much for a custom-built home than a production-built home, and that's not even factoring in the cost of the land itself.

New Construction Home Buying Tips and Tricks

New Construction Home Buying Process Tips

Buying a new construction home can be exciting, but it can also be entirely overwhelming. Let's take a look at a few tips to help you make the best decisions for yourself and your family.

Learn as Much as You Can About the Process Before Hand

Not doing your research ahead of time can end up costing you tens of thousands of dollars during the purchasing process. It's important to understand how much of a time commitment it will be to make all of the little decisions required for a personalized home build, not to mention dealing with lenders and other parts of the process.

Understanding what the process consists of can help you decide whether or not being a new construction home is the right decision for you.

Decide What You Want in Advance

Before you start buying any home, whether new or existing, it's a good idea to sit down and decide what you want ahead of time. How big of a house do you want, and how many bedrooms and bathrooms will you need? Howmuchland are you looking for?

You'll also want to think about what you want out of a neighborhood. Are you looking for a quiet neighborhood that is outside of the city or are you looking for more of a suburban spot that has access to more amenities?

Making these types of decisions ahead of time can help you navigate the new construction home buying process. You don't want to only be considering these types of questions once you are in the weeds and making decisions on a deadline.

Select a Builder After Doing Thorough Research

Though it might not sound like much fun, it is well worth your time to research the best new home developments and new home builders in your area. You'll want to take a look at testimonials, reviews, or even any news reports you can find on the different developments and builders. You might even be able to connect with current residents through social media to learn more about the houses and the developments.

When you are doing your due diligence in selecting a builder you should feel free to ask the builder whatever questions you might have. The selection you make for your builder to determine whether your house-building experience is a delight or a nightmare.

Team Up With a Lender

You are definitely going to want to find the right team to work with when buying a new construction home. Finding a mortgage lender is been the most fun thing to do in the world, but it's worth shopping around. Ask at least five different lenders for their options and the rates so you can find the best option for you.

Hire a Real Estate Agent

One thing that many people might not know is that builders pay for the real estate agent commission when you are buying a new construction home. Given that, it seems like an obvious choice to hire a real estate agent to help you get the best possible deal.

You want to find a real estate agent that has experience with new construction homes. Find an agent that you like working with and that can help you understand every aspect of the process.

Make Sure Everything Is in Writing

You will be communicating with the builders of your new construction home frequently. For this reason, it is best to make sure that you get everything in writing. This way, there is less space for miscommunication or mistakes.

This is one of the reasons that you should hire a real estate agent. They will stay on top of making sure that everything important is in writing and that any necessary documents are signed.

Understand That the Model House Will Have All the Upgrades

If you take a look at the model home for development, it's important to understand that they are showing you a house with all of the possible amenities and upgrades. If you buy their standard package, the house that you buy will not look the same as the model house.

For this reason, it's important to understand what you are buying when you sign up for a new construction build. Paying for extras and upgrades can get expensive fast, so you want to run the numbers before you sign any paperwork.

Are You Looking to Buy a New Construction Home in North Carolina?

As you can see, there are plenty of benefits and drawbacks when it comes to buying new construction homes. Whether or not it's the right decision for you depends on your budget, your timeline, and your personal preferences. Here at Uphomes, we pride ourselves on helping people find their perfect homes in North Carolina.

At UpHomes, our new construction homes for sale tool is updated instantly as soon as new homes hit the market. However, it's important to understand that a lot of new construction homes don't ever end up listed on the MLS. For that reason, you shouldcontact uswhen you are considering buying a new construction home so that we can help you find the perfect new home for you.

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Ryan Fitzgerald

Ryan Fitzgerald

Hi there! My name is Ryan Fitzgerald, and I am a REALTOR®. My goal is to help you learn more about real estate through our Real Estate Blog! Hopefully, you enjoyed the above blog post and it found a way to provide help or value to you. When you're ready to buy or sell a home of your own let us know here. Please feel free to join the conversation by dropping us a comment below.