When you buy a home, people will immediately say, “Congratulations on your new home!” And it is new…to you, the new owners. But is it really “new”?
Residential properties are as individual as the people who want to buy them. Looking for that beautiful Victorian fixer-upper in downtown San Francisco? What about a beautiful Craftsman in Sausalito or Berkeley? Can you find an Italian villa-style, new construction home in a nice suburban area, like Brentwood?
Most people looking for resale homes, whether they are Victorians or Midcentury Modern, assume that there is an intrinsic value in these homes because of their age. And, on the flip side, these people also assume that new construction homes have no such inherent value.
Buying a new construction home isn’t just about being the first person to live in a property, although that is pretty amazing. At New Home Negotiators, we decided to break down buying a new construction home into pros and cons for you.
Pro: You’ve got equity.
The value of a resale home is directly linked to its location, which can be in vogue or in decline depending on the decade. But a new construction home is in a blossoming new development fostering a burgeoning community. Buying before all stages of development are finished can really boost your equity, as values increase as new phases open and community develops. In fact, a new construction home can appraise for more than the selling price when re-appraised when the owner actually moves in.
Pro: You get a warranty.
No, it’s not a car or appliance, but much like those new purchases, getting a warranty is a big perk. Every new construction home is legally required to be protected by warranties. A warranty through Federal and state law insures that your home will maintain its structural integrity for ten years, which includes items like the foundation and roof. The builder is required to fix any problems covered under this warranty, plus they usually add another one-year warranty that covers items like HVAC systems, plumbing, electrical systems, insulation, and more. Buy a resale home? Well, just cross your fingers that the inspector didn’t overlook major structural problems.
Pro: Save on utilities.
That lovely home you’re looking at that was built in the 1950s is a fabulous buy…or is it? At 2,000 square feet, a new build home will cost around $200 a month in utilities, and older homes can cost $300 or more per month. Factor in $1,200 more a year for the Midcentury Modern house, and your savings might not be as much as you think. Plus, by having a new construction home, you have efficient heating, air, windows, toilets—all those things that can waste money in an older home. (And hurt the environment!)
New construction communities are not for everyone. There are some people that just need the character that an older property provides. These new developments can take time to build that character, but if you’re looking to stay for the long haul and raise your children, you’re prime for being those who guide the community to its future glory.
Looking for that perfect new construction home in the San Francisco Bay Area? New Home Negotiators can help you. Browse properties and communities on our website, and call 800-529-4767 for more information and to schedule your personalized home tour.