According to FiveThiryEight.com the average American moves over 11 times in their life. Most of these moves are on the rental side prior to home ownership, but even as a homeowner you still average over three purchases in your lifetime. These three purchases are often some of the largest and most important purchases you will ever have.
Many buyers want their next purchase to be their last. They will do whatever it takes to find their dream home and stay there forever. Instead of buying a home, they consider building it. Building doesn’t work for every buyer in every market, but in the right situation it can make sense. You will pay a premium for what you want but you will most likely never move again. Here are a few pros and cons of buying vs. building your dream home:
Inventory. There is such a thing as the perfect home. You may need to make subtle tweaks to your liking, but the perfect home is out there. Buying an existing home is cheaper and more convenient than building. Any changes or modifications you make to an existing home are often much cheaper than building a new one. If the location is right and the property has what you want, personalizing it to your tastes beats building.
Market Preference. There is something to be said about buying in the right neighborhood. Many buyers start by choosing the area rather than anything specific with the property. You may be able to build your dream home, but it might be 20 miles away. If you love a certain location and market you are better off buying than building. There simply may not be the land available to build in the location you want. You think you may learn to like the market, but ultimately the location is just as important as the property.
Specification.Building a home gives you the opportunity to have exactly what you want. Instead of making changes to the existing property, you can build to your liking. As appealing as this sounds, it isn’t without some hurdles. First, you need to have the time to wait for the property to be built. Depending on your requests, this could take as long as a year from start to finish. Secondly, you need to have the capital available to pay for the property while still maintaining your existing mortgage. Building a property can cost you hundreds of thousands of dollars that you need to have on hand prior to starting. That being said, once your house is finished, you will have exactly what you want. You can come home happy every day knowing there is nothing in the house that you didn’t have a hand in developing. You may not be able to put a price on how happy you will be in the house you built.
Unexpected Hurdles.Building a property is a lot more difficult than it may appear. In addition to the financial obligation, there are potential issues with zoning, permits, contracts, and schedules all before ground is ever broken. During the actual build, there will be unexpected hurdles that can be frustrating and time-consuming. If you are the type of person who doesn’t like surprises, building a home may not be for you.
Ultimately, the decision to buy or build is based on your individual desires and several other factors. Either option can deliver your dream home. You just have to go about it in different ways. After hearing arguments on both sides, would you rather buy or build your dream home?