“Should you buy or build home?” is a question that many people ask themselves when deciding whether to invest in real estate.
There are benefits to both building and buying, but there are also drawbacks for each option.
This article discusses the pros and cons of each choice and how to make an educated decision based on your lifestyle and personal preferences.
Draw Up a Budget to Figure Out How Much You Can Spend on a Home
The first step is to create a budget to determine how much money you have available for buying or building a house.
Once this number has been determined, it’s easier to make an informed decision about whether building or buying would be more beneficial in the long run.
If purchasing saves hundreds per month while still providing enough room for your family’s needs, then that might be something worth considering further.
Consider What Type of Home You Want – Condo, House, Townhouse
The second step is to figure out what kind of home you want and can afford. Do you need a lot of bedrooms for your family, or do one or two suffice?
Are there specific amenities that are important such as having an in-ground pool, train access nearby, a kid’s play area inside the community, etc.?
Knowing these things will help narrow down the list of homes that might work best for you and your lifestyle.
If there aren’t really any special requirements for your new home, such as extra space (laundry room), we may buy instead of building because buying would save us monthly money on our payment, which we could put towards other bills/savings accounts!
And if we build, we would have to wait for an extended period of time for the building to be complete.
Research the Housing Market in Your Area
The third step is to research the housing market in your area.
Regardless of whether you are a first-time homebuyer or seasoned investor, researching the housing market in your area is an important step. To help get you started, we have outlined some of the things to look for when analyzing your local real estate market.
You can search platforms like Better Estimate to see what homes are selling for in your neighborhood. Enter your address or interactive map, select the number of bedrooms and bathrooms you are interested in, then hit search. You’ll immediately see a map showing how many homes have recently sold nearby.
On the left side of the screen, you’ll be able to see what they each sold for, as well as other information like size, beds, baths, etc. If you click on “See Details” next to any listing, it will open another window with even more information (including estimated property taxes), photos, and details about the house.
You can also use this platform to compare prices with sale prices of similar homes in the area that aren’t currently listed on the market.
For example, suppose you live near a train line that has been expanding, and new condos are popping up everywhere.
In that case, chances are it’s going to be cheaper for you to buy rather than build due to how competitive the market already is with so many people vying for available properties.
On the other hand, if there isn’t much construction around or not as many homes on sale right now, then buying may actually cost more monthly than building.
Check Out Resale Listings and Compare Prices with New Construction
The fourth step is to check out resale listings and compare prices with new construction in your area. You can’t determine which one would be more beneficial if you don’t know the value of each property type.
If there is a significant price difference between both, then buying might end up saving you money even when considering the higher monthly payment.
Again, this depends on your budget and what you already have to work within available funds each month.
Get Input from Your Family
The fifth step is to talk it over with family members about which option might be best, depending on your situation.
It’s always good to get multiple opinions so that nothing gets missed when making an important decision like this one.
It could potentially affect many aspects of your life moving forward where the quality of living will play a significant role.
For example: If we build, there are more things involved than just purchasing existing property (time spent with family members during the construction process, financial strain on our budget, etc.).
Tips for Making an Informed Decision About What Type of House You Want to Build or Buy
If you don’t want to go through the hassle of making multiple offers on resale properties and risk getting outbid by other buyers, building might be a better option than buying.
On the other hand, purchasing an existing home saves hundreds per month while still providing enough room for your family’s needs.
The key here is to do thorough research first regarding everything involved with each housing option, like location/transportation access nearby.
The amount spent monthly on taxes & insurance costs vs. heated square footage/amount of bedrooms needed, etc.
You’ll also have to consider relocation costs like packing, loading, moving, unloading, and unpacking by the removals company before making a final decision that will affect all of your lives moving forward!
What Are the Pros and Cons of Building a Home Vs. Buying an Existing One?
Pros of Building a Home
- Increase your control over the interior design, layout, and decorating of your dream home.
- You can build in an area that is not available for purchase or where you cannot find another house to buy.
Cons of Building a Home
- Building requires time, money & effort which could be better spent elsewhere if buying fits within the budget.
- You risk losing some flexibility when it comes to choosing exactly what type and size of property you want as well as its location.
Pros of Buying an Existing House
- When choosing properties, there are more options to fit into one’s price range with little problem.
- There will likely be less work required on such houses than if one builds a home.
Cons of Buying an Existing House
- It will not fit your personal tastes or needs as well as if you built it yourself.
- There is less flexibility about the type, size & location of the property that fits within one’s budget.
What If I Still Can’t Decide?
Once you’ve gone through the steps above, there is usually enough information available to make an informed decision about whether building or buying would be more beneficial in your case.
If it’s a toss-up between both and you can’t determine which one is better for yourself, then go with what feels right!
If it feels like buying is the right choice, then do that. If building seems more ideal since you can control exactly what you want and don’t mind waiting for completion, then go with that instead!
It’s all up to your preference regardless of which one costs less overall or monthly because there are pros/cons involved no matter whether you decide to purchase an existing property or build something new from scratch.
- Draw Up a Budget to Figure Out How Much You Can Spend on a Home
- Consider What Type of Home You Want - Condo, House, Townhouse
- Research the Housing Market in Your Area
- Check Out Resale Listings and Compare Prices with New Construction
- Get Input from Your Family
- Tips for Making an Informed Decision About What Type of House You Want to Build or Buy
- What Are the Pros and Cons of Building a Home Vs. Buying an Existing One?
- What If I Still Can't Decide?