Buying A New Home Resale VS New Build

You are on the hunt to buy a new house. You have browsed some resale homes. Perhaps talked to a few different home builders in London, Ontario. 

But, what is better - building a home or buying a resale home? 

Both have their advantages and disadvantages. It really depends on you and your lifestyle, and what you want in your new home. Let’s take a more in-depth look into the advantages and disadvantages of each option.

Buying a New Home Resale

Advantages:

The neighbourhood is already established. When you go to build a home, it may be in a less developed area. When you buy a resale home, the neighbourhood has likely been around for some time. This means you can get a feel for the place before buying. You get to see the already established parks, commercial shopping areas, schools, and so on. Public transportation also likely already reaches these neighbourhoods, which is especially important if you or someone in your household relies on it.

Your home is move-in ready. You won’t have to wait a year to move into your new home. Once the offer is accepted, the process may move fairly quickly. You could potentially move in within a few months. Further, you won’t have to worry about small details, like if it has air conditioning or heating, or choosing light fixtures especially when it is covered under home warranty. Plus, the basement may already be finished, saving you the hassle of doing it later or paying extra for it.

You will save on taxes. You likely won’t have to pay HST on a resale home. If you have a tight budget, buying resale might be the better option.

Disadvantages:

An older home may require more work and renovations. Depending on the home you purchase, it may require updates or repairs. Make sure to get the home inspected before buying to limit this. But do keep in mind that an older home will come with it’s share of work over the years as things wear down.

You may have less space. If an older home was updated recently, this may not be of your concern. However, older homes may have smaller rooms and bathrooms. Yet, this does really depend on the previous owner and if they invested in renovations since the original build.

The home may be less energy-efficient. Older systems may mean it could rack up your heating and air conditioning bills. Ask the previous owners how much they pay on average before diving in headfirst.

You get what the old owners chose. You inherit the countertops, flooring, and cabinets. While you can renovate, you won’t get to customize quite like you can with a new build.

Building a New Home

Advantages:

More advanced materials are used. This means everything will be up-to-date on safety and construction standards. It also means you will have a more energy-efficient home and your cost for heating and air conditioning may be less than that of a resale home.

You are eligible for the New Home Warranty Program. What does this mean? This warranty program means you are protected against structural defects. If building codes are violated, you won’t have to pay up. Make sure you get your warranty administered. 

Forever Homes

Photo by Forever Homes, a premiere builder located in London, Ontario

You get to customize it to your exact specifications. The best part about building a new home is that you get to select everything from countertops to flooring. You get to make it yours and modernize it. Everything is brand new.

Disadvantages:

The location may not be ideal. New homes are often built in new neighbourhoods. These neighbourhoods tend to outline the city, meaning you might end up living far from the major hub of it all. You might also have to put up with ongoing construction during the first year or 2 as houses and the neighbourhood build up around you. Further, certain services that come with commercial properties may not be close by yet - remember, the area is under development. It may be a few years before you have a grocery store or schools close by or before public transportation extends out your way.

You will have to pay HST. The price may goes up when building your own home. You will have to pay the HST tax. However, this is frequently included as part of the purchase price (always make sure to double check!). 

It isn’t move-in ready. If you want a more immediate new home, building likely isn’t for you. Building a new home takes longer. When building, you also need to expect delays. The move-in date can change due to bad weather or regulation changes.

You won’t know who your neighbours are. In fact, you might not even have neighbours for a period of time. Hope for the best when they do move in!

Whether you chose to build or buy a resale home, both options have advantages and disadvantages. The important part is deciding what works best for your situation and your lifestyle. What is important to you? What are your priorities? What is your budget? Determine these things, then make a decision. Find or build the home of your dreams!

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