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New build vs. older home

When it comes to pricing and financing is one better than the other? The neighborhood I was admiring appears to have homes that were built 8 years ago or more recently but there are other parts of the neighborhood where they are building brand new.  The list prices on the older homes are obviously lower than what the prices show for a new build. Is there any negotiation of price when it comes to new build? Does one need an agent for buying brand new? What are the differences when it comes to financing new vs older homes?
  • January 28 2013 - Fort Bend - Houston
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Answers (9)

Whether your're buying a new house or "resale" house I would work with a Realtor.  As I'm sure someone has already said, the listing agent or the new home sales person only represents the Seller and cannot give you advice. Prices and terms of the contract are usually negotiable. You need a Realtor to advise and advocate for you with new homes and resale homes. As for new vs. old, all things being equal a new home would be worth more, but few homes are identical to each other these days. There are differences in lot sizes, location, upgrades, updates, materials, and condition, just to name a few. These things and many others affect the price.
  • February 23 2013
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Profile picture for sunnyview
Honestly, you don't need any agent to tell you that the new house you are looking to buy today will not be new when you go to sell. That writing is on the financial wall already.

You see than the houses in the last phase from 8 years ago are priced lower than the new ones. When you go to sell, you too will be competing with the builder and their next phase unless the neighborhood is 100% built out.

New does not mean no problems. It also does not mean nicer than existing homes. Buying new you still need to get an inspection. You may or may not use an agent, but I would suggest having an attorney look over the builders "standard contract". Often there are legal points that you will need to have reviewed by your own expert not related to the sales process or builder.
  • February 21 2013
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While buying a used or new home is largely a lifestyle decision, that still shouldn't prevent you from also thinking like a seller because you will be selling the house someday. 

Hence, it is advisable to contact an experienced agent who can provide you with all the information you need about pricing, financing, the neighbourhood etc. in making your decision.

  • February 21 2013
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You need professional and competent representation, so yes you should consider bringing in a Buyer Agent. With a new property, the home will be built "up to current code" which is nice for you and eliminates costs.
Often it will have all the upgrades that are desired by buyers. There is also the advantage of it being new. It has been my experience that many buyers love new homes.
  • February 20 2013
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Profile picture for sunnyview
People often overpay for brand new houses. If you can buy a house that is solid and 8 years old for less, the owners have already taken that financial hit. They also have added fences, landscaping, blinds and other things to the home that new houses often don't have. Just remember, when you go to sell the house will not be "new" anymore and no one will be willing to pay you a premium for a 5 year old house.

You should get a good inspection whether you are buying new or existing. New does not mean no issues and there are things that pop up from basic code issues to unfinished work on new houses. I would never buy new without an attorney to review the "standard" builder contract and without a good inspection.
  • January 29 2013
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Profile picture for Ofe Polack

It is not a bad idea to have representation when signing a contract and negotiating with the builder.  Builders tend to like to keep the listing prices, but experienced buyer agents can request options to be included in the price.  When it comes to financing, the appraiser will compensate for the age of the  properties included in the appraisal.  Some buyers prefer existing homes with upgrades and established gardens to new homes, others the opposite.  It is a personal decision, I guess.  The best of luck! 

  • January 29 2013
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Profile picture for ScottBROKER209
If you are financing, you are going to need an appraisal on the property and the appraiser is trained to search comparable sales that are most similar to the property you are in contract on.  So even though there are differences in your particular neighborhood, the appraiser will find fair market value.

Also if you are a serious buyer...find a real estate agent to assist you in both finding the right property and making sure you don't make the wrong offer on a home that is priced to high.  Furthermore, if you go to a NEW home sales tract to purchase, understand that the sales person works for the BUILDER, and you may feel you do not have much support on your side if issues arise, so an agent is worth every penny.  

Builders generally do not play with the price much as they prefer to give upgrades away instead, so if you bring an agent in...the builder still pays them and you get assistance.

Good luck!
  • January 28 2013
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Hello. It's in your best interest to work with a professional/REALTOR who will advocate for and negotiate on your behalf. It's also important to align yourself with a mortgage expert who understands the area you are interested in and its market (i.e. new and old construction).  Feel free to contact me directly (dena.ray@cbmoves.com / 917.295.5423) for more info that could help you.  Good luck! :-Dena Ray, Coldwell Banker Residential Brokerage
  • January 28 2013
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There really isn't any difference. It just depends on your preference. On Newly build homes sometimes they have an onsite model and they offer incentives to buy directly from maker. However, price always varies whether the house is new or old based on square footage, location and the properties ameneties... Hope this helped you a little. Either way contact a good real estate agent to assist you, especially for comparables.
  • January 28 2013
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