Should you buy a new home from a builder or look at the resale market on MLS? It’s a tough question with plenty of things to consider. Like so many things in life, there are pros and cons to each approach.
The Pros of New Construction Homes
Customization Options
You can do your new build however you like, especially if you are using a smaller boutique contractor. There’s plenty of choice for fixtures, counter-tops and flooring. Ceiling height and room layouts, lighting type and location, bathtub, shower or both, it’s all up to you.
Low Maintenance Costs
A new build is exactly that, new. You can expect hassle free living without the worry of things breaking for at least a few years anyway. You’ve got a Tarion new home warranty as well for bigger issues, if they arise during the warranty period.
Cutting Edge Features
Building new will almost always get you the latest in design and materials. HRVs, low E glass, heat pumps, car chargers and high R value insulation are all available in new construction.
Modern Design and Layouts
Open concept living areas are pretty typical in new homes, as are larger, more useful kitchen spaces. Ensuites are a given and most of the time easy maintenance flooring choices like luxury vinyl or engineered hardwood make broadloom a thing of the past. Basements, even unfinished usually have higher ceilings and roughed in bathroom plumbing for when you are ready for more space.
The Cons Of New Construction Homes
Higher Price Tag
New builds are considerably more expensive than 30 year old homes. They are usually more money than a 5 year old home too. Part of the reason is tax and the rest is simply market economics, as home builders generally will not negotiate price unlike the resale market. And here in Ontario, builders usually eat the HST by making you sign over your rights to the HST rebate offered by the government. Another concern is falling sale prices after you’ve purchased, something that can happen with long lead times on pre-construction sales.
Landscaping, Amenities and Community
New neighbourhoods suffer a dearth of trees and sometimes sod as well. Fences, decks and driveways are often unfinished when you take possession. Schools, parks and grocery stores are ‘to be determined’ and there are no bus routes either. Neighbourhoods are nothing more than a collection of homes with plenty of construction vehicles and dust to deal with.
Possible Delays
Your possession date is not guaranteed. In your contract, there are usually 3 dates the builder can be late by before penalties even begin. You could potentially find yourself homeless while you wait for the builder to finish.
Limited Locations
Land in Waterloo Region is a bit scarce. You cannot buy a single building lot anywhere so you are mostly stuck buying in the bigger new developments on the outskirts of the tri-cities.
The Pros Of Resale Homes
Established Neighbourhoods
You’re buying into an established community, with stores, parks, activities and schools already in place. Older neighbourhoods have a sense of community that new ones lack.
More Affordable
The older you go, the more bang for your buck. Mature neighbourhoods can be 100k (or more) cheaper than the newest builds.
Move-In Ready
There’s no waiting for the builder, no waiting for landscaping, no waiting for anything. Get the keys on possession and walk in the front door.
Lot Size
Older communities usually have generous lot sizes, unlike the postage stamp ones in new suburbia. Your neighbour’s house is often 10, 20 or 30 feet away, not 3.
The Cons Of Resale Homes
Higher Maintenance and Repair Costs
Things need repair and this happens a bit more frequently the older a house is. Roofs, furnaces and ACs all have lifespans. Windows are good for 25 years at best. These items are all things you need to consider when buying resale.
Less Energy Efficient
HVAC and insulation isn’t usually done to current standards in older properties unless retrofitting and updating has been done. Vapour barriers in walls will be absent.
Outdated Layouts
Older homes are often cramped with tighter hallways and smallish bedrooms. Bathrooms are fewer and not as well appointed. Ensuites off the master are uncommon.
Limited Customization
What you see is what you get with a resale home. Anything major you want to change will be costly and/or labour intensive.
Summary
That new build smell and feel can’t be duplicated in a resale home. No one except you will be living there. If you want that, along with modern features and customization, a new home makes sense. There won’t be much in the way of maintenance either, at least over the first few years.
Resale offers cost savings and character. Neighbourhoods are established with the landscaping fully grown in. You usually get a much nicer lot along with better street parking. If you’re careful you can get the features and layout you want, even if that requires additional work after your purchase. There are plenty of resale homes on the market with spectacular renovations.
Consider the pros and cons of new vs. resale and factor in your needs before deciding. Get hold of an agent and take a look at some homes in established communities. Visit a few builders too, and see what they can offer you. The more you can learn about each option the happier you’ll ultimately be.
