Buying and renovating older homes looks so easy on HGTV, doesn’t it? In one short hour, a home goes from dog to divine. Within budget. And remarkably, within the skill set of clueless homeowners. Cue the sledgehammers and safety glasses. But—no surprise here—“reality” TV tends to gloss over the drudgery and blown budgets. So if you’re debating the purchase of a new vs. resale home, you’ll want to weigh all the pros and cons.
Kick off your own pro/con list by reading this article on Zillow. Highlights from their resale pro list: An established neighborhood with mature landscaping. Possibly more charm and character. More styles to choose from. Cons: Dated design, appliances, and amenities. More stress, time, and money spent on maintenance. Less energy efficiency and costlier to operate. New home pros: Contemporary style. Cheaper to maintain with new appliances, higher energy efficiency, and extended warranties. Some design personalization during construction. New home cons: Little bitty trees and shrubs. Less character in design (with some builders, but not those in Stepping Stone, of course).
Let’s explore the maintenance issue a little more deeply. Bankrate.com evaluates the merits of old vs. new, advising buyers to factor in replacement of old components when comparing prices. If you’re looking at a resale home, find out when the roof ($15,000), furnace ($5,000), appliances ($2,000), wiring, and plumbing were last replaced. Sometimes an older home will be completely updated; but more often than not, the home will have some deferred maintenance issues. As the article explains, “Repairs don’t create a return on the investment, and few improvements recapture 100 percent of the cost. Some improvements recapture only about half the outlay.”
Newhomesource.com is a fun, graphic source for quick comparisons. For example, plug in the age and square footage of a resale home you’re considering, and it will calculate the number of hours you’ll spend on maintenance. Buy a 2,500-square-foot 1990 home and you’ll spend 61 hours more per year doing maintenance than with a new home. That’s maintenance—not a major DIY remodel. If you go that course, add in the hours of labor and troubleshooting that could go toward family time. And of course there’s the stress…
With a new home, you’ll typically have input on the design—and you’ll know your choices are up to date in everything from cabinets, countertops, and flooring to media rooms and outdoor living spaces. With a resale home—unless you find a completely renovated home, which will be top dollar—you can count on at least some aspects feeling dated.If you do decide to renovate a resale home, keep in mind that remodeling projects typically run 10-20% over budget unless something really goes awry. Resale homes tend to have smaller kitchens and bathrooms, and those remodeling projects are the priciest: $20,000 for kitchens and $10,000 for bathrooms, on average.
Famed remodeler Bob Vila also advises DIYers to factor in hidden remodeling costs such as waste disposal, take-out food during kitchen remodels, landscaping for plants destroyed by lumber stacks and toxic spills, and post-renovation carpet and home cleaning.
One last cost comparison to consider is energy efficiency. New homes typically use 3,449 kwh less per year than their older counterparts. To put that into perspective, that’s enough energy to power your TV for 11 years. Newhomesource.com has another handy calculator for energy savings. Comparing that 1990 home again, priced at $450,000 and sized at 2,500 square feet, its new counterpart will save you $8,259 on your energy bill each year.
For some people, the historic charm of a Victorian or mid-century bungalow outweighs any facts or figures. That’s cool. But everyone should go into their purchase with eyes wide open. When it comes to saving time, money, and stress, new homes are simply tough to beat.
Check out new homes for sale now at Stepping Stone.