Is it better to buy or to build? That’s a great, age-old question! When it comes down to it, the decision to buy or to build is completely up to your unique situation. Consider things such as whether you’ve owned a home before, what your budget is, your household’s anticipated growth, your timeline, and the availability of land when contemplating what will work for you.
Previous homeownership
Many times, choosing to build comes after having owned a home for the first time. This is primarily because homeowners, and occasionally renters, learn from their experiences and are better able to recognize their preferred home layout, what home size works best for them, and what they like and dislike about the home they currently live in.
Budget
Considering your budget is important when deciding whether you should buy or build a home. Many times, though not always, building costs more than buying an existing home. That is often why first-time homeownership comes before building.
Aside from the wait time, the processes for financing a new build and getting a mortgage on an already existing home are very similar. Keep in mind the variable down payment options with mortgages, as well as loan buydown options.
Another thing to keep in mind during budgeting for building is the cost of building materials. This can be a large factor in whether or not it’s the time to build a home. An additional cost that’s important to consider is the purchase of new land, if necessary. Land cost, if not already owned, is an important factor to consider when budgeting for building a home.
Household size and growth
Though it’s difficult to predict the future, something to consider when considering a build is the size of your family and whether your family will grow. Building is often a more permanent decision than buying a pre-owned home, so it’s important to consider the future if you want to build and remain in the home permanently. Ensure you know how many beds and baths you want in the house, as the addition of rooms can increase the cost of the home. If you expect growth in the future, prepare for that by planning for extra bedrooms and bathrooms.
Land availability
One of the biggest things to consider in your decision to build or buy is the availability and cost of land. Have you already purchased land that’s ready for a home? Are you prepared to buy land for a new home? It’s important to keep land availability and price in mind when choosing to build.
Timeline
What is your timeline for moving into a new home? Do you need to or want to be moved in within 3 months? Are you comfortable waiting another year to move? One of the biggest differences between building and buying is the timeline! When you buy a home, you can move in within a month, in many cases. However, when building a home, you can expect a multi-month, or even multi-year, wait before moving in.
Pro Tip: While you’re waiting for your dream home to be built, consider taking advantage of Flat Branch Home Loans’ Extended Lock option, which allows you to lock in your desired interest rate for up to 240 days while your home is being built. This is a wonderful benefit to help you secure the best rate option for your home.
Building is a great thing to consider, and Flat Branch can easily help you! With buydown options, extended locks, and mortgage options, building is a great option to move into a permanent home.
