Keystone Blog
Purchasing a home is a major life decision and a serious investment. One of the first choices to make in the homebuying process is whether buying new construction or an existing home is the best option for you. Learn about the cost associated with either option and whether it is better to buy a home or build one with Keystone Custom Homes.
When comparing the cost of building a home vs. buying an existing home, consider all variables associated with the final price. On average, buying an existing home is cheaper than building a new home at the time of purchase, but the cost at signing doesn’t account for the ability to customize — an unquantifiable value — and the long-term financial impact of new construction vs. existing homes.
Calculating the average cost of a custom-built home is more difficult than an existing home, as each build is unique and customized to personal preference. Some home builders will offer a cost-per-square-foot pricing model. Keystone Custom Homes doesn’t use this model because the cost of a basic homesite is included in all pricing!
Building a new house has several advantages to consider:
When building a new home, you are able to see the quality of the construction at every stage of the process! We encourage our customers to take photos of their home pre-drywall so that they can easily reference piping and electrical wiring for any future desired changes. It's much easier to plan ahead rather than demo existing structures or surfaces.
Minimize surprises, expensive repairs, and unwanted smells when building a new home vs. buying a used house. Building new guarantees that your home is safe and up to date using the newest technology and materials available.
Energy-efficiency is an important factor when comparing the cost of building a new house vs. buying an older home. Because they’re built with durable technology and equipped with Energy Star products, new construction homes are 70% more energy-efficient than resale homes. This efficiency makes for less expensive energy bills, as well.
Not only does an energy-efficient home leave less of a carbon footprint, it also helps lower monthly utility bills. Aged windows, inefficient lighting, and outdated appliances found in older homes are often the source of hidden energy costs that drive utility bills through the roof. Keystone Custom Homes’ Energy Plus homes are constructed for maximum insulation and include energy-efficient appliances that make them 40% more energy-efficient than other new homes!
Building a new home allows you to choose options and make selections that support your design preferences and lifestyle needs. Keystone offers over 10,000 clickable options on our most popular plans, including structural changes! Building customization into a new home requires less effort and achieves your ideal look, rather than retroactively fitting your design into an existing space.
When deciding between new construction vs. existing homes, consider your ideal budget, timeline, and location.
Building a new home may result in higher mortgage rates than for buying an existing home. Construction projects can be complex, so lenders tend to set higher interest rates to offset their risk.
New homes can take several months to complete, depending on various factors, such as the weather and material availability. If you need to move in quickly, buying an existing home may be a better option unless you choose to purchase a nearly-completed or recently-completed home.
New homes are often built in open spaces that are farther away from urban areas. Depending on your preferences, the distance from city centers and their amenities may be a downside. You could have longer commute times to work, shopping, and dining options. Building a new home also means that landscaping will not be mature in the area.
Investing in an existing home can have many benefits that suit your lifestyle and preferences.
When you build a new home, you are dependent on the builder's timeline and any delays they may encounter. Buying an existing home allows you to move in much more quickly. The faster timing may be ideal for you as long as the home doesn't require significant renovations.
Existing homes are usually found in established communities with mature landscaping and a sense of history and character. The homes may have unique architectural details that would be difficult to replicate. It may be easier to find an existing home closer to city centers and features you enjoy.
You may be able to find an existing home that already fits all of your needs. You can customize the space with renovations or retain what is there and adapt it to your lifestyle. With fewer decisions to make, you can enjoy your new-to-you home sooner.
Determining whether you should invest in a new build vs. an existing home depends on your budget and how you want to customize the space to meet your needs.
Older homes have outdated floorplans that may not work for your family and lifestyle. Remodeling the home to create open floorplans, add more windows, or expand spaces can be complex and expensive. The dated features may or may not suit your preferences.
While upfront costs for buying an existing home tend to be lower than building a home, long-term expenses could be higher. Older homes are generally less energy-efficient due to older appliances and insufficient insulation. The home could use or lose excess energy, leading to increased utility bills.
Depending on the home's age and condition, it may require more maintenance and repairs. You might need to replace large components like appliances, heaters, or the roof sooner rather than later. Older homes may also have hidden problems, such as mold or pests, that could lead to costly repairs.
Outside of existing new home communities, Keystone Custom Homes offers the option to build a new home on your own lot. This is the most flexible way to build a new home and enjoy maximum customization, but it is more expensive than both a traditional new construction home and an older existing home.
The typical price to build a new home on your own land includes:
In addition, the buyer must cover the expense for a percolation test to determine whether the homesite is buildable. In the event of a negative test, additional costs will be tacked on in order to move forward with construction. For more information about building a home on your own land, visit Keystone Custom Homes’ On Your Lot FAQ page.
Typical costs of building a new home include:
When buying an existing home, the property is sold in its current condition or with some minor repairs as stated in the offer. Additional investments are required for remodeling, renovations, and decorating, where new construction allows specific customizations for a one-of-a-kind home built for longevity.
Renovating an existing home offers the option of customization at a lower price than a new construction home. However, renovations aren’t always straightforward and may end up costing more in the long run. Consider the following costs of renovation vs. new construction.
After finalizing the purchase, homeowners are tasked with planning renovations — a tedious and often time-consuming process before any selections are made. The planning phase of renovations includes:
Remaining within the established budget is often a challenge, as hidden costs tend to add up in various forms. Because inspectors can’t move anything during a home inspection, costly issues that weren’t originally identified can increase the renovation bill.
Examples of roadblocks in the renovation process that delay progress and drain funds from your budget:
The price of new construction at signing is higher when choosing a new home vs. an old home, but renovation costs can match or exceed new construction in the long term. Buying new construction is more straightforward, and you can customize the home to your exact preferences instead of completing laborious renovations on an older home. To see how easy it is to start a new construction home versus starting a renovation, visit the Building Process page.
So, is it better to buy a home or build one? Building new construction offers an array of benefits, and the final price can be in the same ballpark as buying an existing home after renovations. The upfront cost of new construction includes full customization — with thousands of options to choose from — diverse location options, and the ability to build on your own land. Utilizing energy-efficient technology and appliances, a new construction home is built for durability and longevity.
Coming to a decision between the cost of building a house vs. buying an existing home can be difficult. If you’re struggling to come to a final verdict, the Keystone Custom Homes team is here to answer any questions you may have about building a new home in PA, MD, or NC. To talk with a team member, call 717-368-9831, chat with one of our Online Advisors or fill out a contact form.
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