A home is one of the biggest investments you can make, and the American Dream for many. Most people spend significant time finding or designing their “dream home.” The first decision is whether to buy or build.
As of September 2018, the average sales price of a new home was $377,200, according to joint data collected from the U.S. Census Bureau and the Department of Housing and Urban Development. Existing homes sales price was approximately $258,100, according to the National Association of Realtors.
New homes attract bigger prices than existing ones, meaning building costs are also high. So, how do you decide what is best for you?
Here are five factors to consider.
Time
Building a home takes time since you must complete several phases. You must buy land, find an architect to design, get building permits, find a contractor and start building. It can take between six months and a year before you move into your new home.
Buying an existing home shortens that time. For a new house, you can move in once the escrow closes. Older homes may require renovations, but it won’t take long.
Home Design
Building your home gives you the benefit of customization. Working with your architect, you can design your dream home to reflect your taste and preference. Buying an existing home, means you may have to compromise on a few aspects.
Energy Efficiency
Rising energy costs is a concern to potential homeowners. Designing your own home means you can incorporate measures to be energy efficient. Buying an old home may require more resources to upgrade. That might end up hitting your wallet harder.
Fortunately, most homebuilders are responding to market demands for energy efficient homes. Most new homes meet these standards.
Budget
Budget is an important consideration when buying or building your home. A buying price on an existing home reflects the value of the house.
Building, on the other hand, means you have to juggle a budget constantly throughout the construction period. It is not uncommon to spend more than you budgeted for initially.
Even if you decide to find a perfect existing home, you may finally opt to build. Conversely, you may strategize to build and later choose to buy an existing home. In both cases, working with qualified professionals such as a trusted mortgage lender, real estate agent or a builder can make the process seamless.
Saving up for a down payment can feel overwhelming. Most people have never saved up the kind of money it takes for a down payment. It can be done, though. The goal is to put 20% down on a house. This is what it takes if you don’t want to have to pay private mortgage insurance every month.
A title search is an early warning system for buyers and lenders. It reveals flaws the owner must resolve prior to a closing or refinance request. This allows the owner to clear any issues on the title so that the process can move forward. Also, it protects the buyer or lender from assuming an obligation they aren’t responsible for. 
Last week’s economic reports included National Association of Home Builders’ Housing Market Index, the Federal Reserve’s Beige Book report and the University of Michigan’s Consumer Sentiment Index. Weekly readings on mortgage rates and first-time jobless claims were also released.
Buying your home can be nerve-racking, especially if it’s the first time. The buying process is exciting and often complex. The chances of making a mistake are relatively high. 
After two months of declining builder confidence, the National Association of Home Builders Housing Market Index gained two points in January with a reading of 58. Component readings of the HMI were also higher with builder confidence in current market conditions rose two points to an index reading of 63. Builder confidence in housing market conditions over the next six months rose three points to 64.
When you make an offer on a home, you wait anxiously to see if it will be accepted. Sometimes you’re lucky enough to hear back within hours. Other times you could wait days or even weeks.
Atlanta, Charlotte, New York and Los Angeles are always on the real estate radar because of big ticket sales and good media coverage. The secondary markets – those markets without the celebrity undertones – may actually be better deals. With the price of borrowing money rising and occupation rates dropping in primary markets, places like Nashville and Birmingham are looking better to investors.
Last week’s economic reports included remarks by Federal Reserve Chair Jerome Powell, readings on inflation and core inflation. Weekly readings on mortgage rates and first-tome jobless claims were also released. If the government shutdown continues, it is expected to impact release dates for readings from federal government agencies.
If you’re looking to get an untraditional deal on a new home purchase, you may encounter either a short sale or a foreclosure. These two terms refer to sales that are not usual. As a homebuyer, it’s important to understand the differences between them and how each one might affect your buying experience.