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As a first time home buyer, you have two options. You can save money by going into an established neighborhood and updating an older home to your specifications, or you can buy a smaller new home. At the very least, your decision will be based largely on compromise -- new home/smaller space versus older home/remodeling costs.
Depending on where you live, new homes may be very affordable or very difficult to find. In Dallas, Texas homes are selling more than 10 percent above last year's prices, new "starter" homes are at a premium and well above the $100,000 ceiling of the mid-90s. Affordable new homes in a "tight" market can begin at $120,000 to $150,000 in more desirable neighborhoods, placing them well out of reach for much of the first-time market. Add to that the burgeoning costs of new materials and the scarcity of labor, and you have new construction at a premium. If a new 2,000-square-foot home generally averages $75 per square foot, a comparably sized older home in the same neighborhood may cost as much as one-third less. So just what do you get for the difference in costs? |
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More amenities and convenience
New homes feature built-in appliances, including dishwashers, and nearly all have central air and heat. They also feature more electrical outlets. Amenities include vanity cabinets, large mirrors, medicine cabinets, whirlpool tubs, and easy-to-clean plastic tub enclosures. |
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Safety
Occupants of new homes are almost six times less likely to die from fire than occupants of older homes. Many new homes come equipped with hard-wired smoke detectors on every level, complete with battery back-up should the power go out. Fires are diminished due to the lack of need for space heaters and because of more efficient central heating systems and better insulation. Electrical power systems in new homes are properly sized for the heavier electrical demands of today's homes, and wiring systems are less likely to cause fires. Circuit breakers have replaced fuse boxes, which can be overloaded by using the wrong-size fuse. Ground fault interrupters for bathrooms, kitchens, and outside receptacles reduce the chance of fire and electrocution. Today's glass in tub enclosures and patio doors in new homes must be tempered so that it will crumble if broken instead of shattering into large jagged pieces that can seriously injure people.. |
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Health
The building industry has responded to the health risks of certain products by building with products and systems that make new homes better for your health. Asbestos, which can increase the risk of respiratory disease, has been eliminated from shingles, pipe, cement board, roof tar, floor tiles, ceiling tiles, and insulation. Lead, a potential poison, is no longer used as an ingredient in paint or as solder for plumbing. Formaldehyde emissions from particle board and hardwood plywood have been greatly reduced in new homes. And urea-formaldehyde finishes on most kitchen cabinets are now baked or cured to minimize emissions. Builders are now installing systems to control radon gas, where it is a problem. These systems usually include installation of gravel and polyethylene film beneath basement floors and concrete slabs, and provide for later installation of vent pipes and fans, if required. Older homes frequently have no gravel in which to collect the gas, no polyethylene film to retard movement of the gas through the slab, and no vent pipes. Mitigating radon from an existing home is generally far more expensive than building radon prevention techniques into a new home. |
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Energy efficiency
Because of better windows, more efficient heating and cooling equipment, better control of air infiltration, and greater use of insulation, new homes consume half as much energy as homes built prior to 1980. Old homes tend to be drafty and less comfortable, and frost and condensation are more likely to appear on windows, drip down, and cause deterioration of wood trim and walls. |
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Lower maintenance
New homes require less maintenance. New homes are available with siding, windows, and trim that never need painting. Wood decks are typically made of pressure-treated lumber resistant to rot and insects. Pressure-treated wood is also used where wood comes in contact with concrete. |
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Obtain one or more bids
Choose a builder for the construction of your home. The builder you select may be the same one who has assisted you thus far with the process of building your new home. You might decide to obtain one or more formal bids for building your home. The bidding builders will assemble subcontractors' bids, suppliers' proposals and other estimates into a formal cost analysis based on the complete written specifications for your home. |
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Finance your home
At this point in the process, you'll be ready to arrange the short-term construction financing and the long-term residential mortgage for your new home. |
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Obtain permits
Obtain construction-related approvals and permits. Before construction can begin, you'll need official signoffs from the local government building department, utility services and the architectural control board or committee, if any, that has authority over your site. |
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Build your home
If your plan has been well-executed, the construction of your home could be the easiest part of the process. |
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Completion
Closing and completion of final work. After your home is built, the lender will fund your residential mortgage loan and the builder will make any repairs necessary under the home warranty. |
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Qualify with a Lender Here! |
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