Should I Buy a New Home, or a Previously Owned Home?

This question's an easy one to answer:  It depends!  See!  Pretty easy!

Ok, all kidding aside, I'm a huge advocate for new construction.  My wife and I have owned 3 homes over the past 12 years. Two of those were new construction.  That shows my personal taste. However, there's always two sides to the story. You can't buy a new, 1907 Victorian home in Pleasanton.  You'd be hard pressed to find a brand new home in a neighborhood with 90 year old, beautiful oak trees. You probably aren't going to find a new home in Brentwood on a half acre lot.  So, who benefits from new home construction?  Who is buying them all...and why?


Here is a list of reasons that might compel you to buy a brand new home as opposed to one that is pre-owned.

• With little to no change in sales price, new home builders often offer choices as to color and styles of the features of your home. No, these aren't upgrades, but they're still choices. Carpet color, tile, vinyl, counters, cabinets, etc.  You'll often have 3 or 4 choices in each category to choose from at no extra cost.  
• Builders often use their own lenders, which gives me, as your agent, several opportunities to negotiate: 
• 1) The price of the home. 
• 2) The terms of the loan.
• 3) Closing Cost Credits
• 4) Design Center Credits
• In my family, we had little-ones crawling and rolling around on the floors. It brought us peace of mind knowing that not just the carpet was new (and in a color we loved)...but the carpet pads and sub-flooring was new as well.  No smokers, no pets, no allergies, and no spills that are going to resurface 4 months down the road.
• Competition: Typically you're not going to compete with several other buyers for the same house. You'll likely have the choice of many new homes and models, or even the same floor plan on different lots.
• When you buy a 35 year old home, you've got 35 year old...everything else...attached.  Infrastructure: In new home communities, you've typically get new sewers, streets, lights, and more.   
• Ahhh...the dreaded home inspection!  Everything is new!  What's to inspect?  With pre-owned homes, you've got those anxious days between the time you write an offer and the time you receive your pest and home inspections.  New home construction likely allows you to skip this step altogether.
• Appraisals?  Yes, your new home must appraise in order for a lender to fund, even on new construction.  That said, it behooves the builder to price their homes accordingly.  Have I seen a new home NOT appraise?  Yes...once.  In that case, the builder simply reduced the price to the appraised value.  
• Virtually all home builders will sell to FHA and VA buyers!  These buyers are typically well qualified and committed to the process.  
• Home warranty? It comes with one!  Wait...it comes with several: Foundation, Roof, Finish, Appliances...everything!
• You've got a builder's reputation at stake, and they'll stand behind you.  With pre-owned homes...the seller's likely moved on, and you'll never see or hear from them again.

I could easily create a list that's just as long and just as compelling advocating the purchase of pre-owned homes.  In fact, I'm sure I will.  However, at this point in my personal life, and with a young family in tow, I feel very peaceful living in a newly constructed home and I'm always at peace when I help a client negotiate a deal with a home builder.

Wait!  You mean...I help people negotiate deals with home builders?
Absolutely!  Countless times! Really, at this point I couldn't guess how many times. Often enough, in fact, that periodically simply accompanying my clients on their first visit to a builder's model homes pays huge dividends to the buyers. If I accompany a buyer to a builder's sales office, it often allows me the ability to negotiate on their behalf. I've negotiated upgrades, closing cost credits, appliances...even fully landscaped backyards...at no extra cost to the buyer.  But wait, do I get paid a commission?  Yes!  Well technically no. It's customary that the seller of a home pays both sides commissions.  In the case of virtually all new home communities, they aren't going to pay a commission.  They pay a marketing expense; a referral fee.  This is not a line item on your closing statement.  It doesn't come from the sale of the home.  It's paid by a different department all together.  Often the same one that pays for TV commercials, web presence, and print advertisements.  This mean that a) you do pay me, and b) I'm absolutely committed to giving you the very best service possible and negotiating aggressively and effectively on your behalf.