March 2019 Posts
There are several pros and cons that come with buying an existing home and with building a new home. This is often a big decision for those shopping for a new home as they may prefer something specific drawing them to one or the other. If you are trying to decide between buying an existing home or building a new home, it may help to look at the pros and cons of both.
Pros of Buying an Existing Home
Buying an existing home means that it has been lived in before. Sometimes, this home could be just a couple of years old. A few pros for buying an existing home include:
Faster closing and move in – Compared to waiting for your home to be built, you will be able to buy and move into an existing home in about 30 to 60 days.
Better Overall Value – An existing home has already established value, and you will be paying a price based on value, not based on the construction costs of the home.
Established Neighborhood – Most existing homes are found in neighborhoods that are well established.
Potential for Charm – You cannot build a historic home, and some features found in homes from previous decades are not found in new homes today.
There are several other pros to buying an existing home, but these are the main ones.
Cons of Buying an Existing Home
Of course, nothing is perfect and you will find some cons to buying an existing home, such as:
No options – You cannot customize the home to fit your needs.
Renovations/Upgrades – You may need to pay for renovations or upgrades.
Used – It has been lived in before.
While there are not many cons and some may be mitigated based on the home you choose, there are a few cons to buying an existing home.
Pros of Building a New Home
Just like with buying an existing home, building a new home will have its own set of pros and cons. Some of the pros of building a new home include:
Fully Customizable – The only limit to customizing your home will be your budget. You can set it up to be the way you want without any concessions.
It is Brand New – You will be the first and only person to live in the home, which can be a big pro for many people.
More Efficient – Compared to an older home that has not been upgraded, a new construction home will be more efficient.
Warranties – New homes come with warranties making home maintenance much easier and less of a worry for the first few years.
No Worries of Health Hazards – Older homes may have asbestos, moisture issues, mold or even radon. New homes will not come with any of these worries.
Building a new home can have plenty of benefits and these are the main ones.
Cons of Building a New Home
There are some cons to consider if you are thinking about building, however. Some of the main cons of building a new home include:
Appreciation – Resale value may not be so high, and it may take years to gain the appreciation necessary to make it worth the investment.
Closing Costs – Upfront costs will be much higher compared to buying an existing home.
Delivery Date – It will take longer to build a home than to close and move into an existing home with the average build time taking 120 to 150 days or longer.
Predictability – You may encounter unexpected costs along the way.
Noise – You may be living in a construction zone until the neighborhood is fully developed.
There is plenty to think about when comparing the option of buying an existing home to building a new home. Regardless of your decision, it is best to hire YOUR OWN real estate agent to help you throughout the entire process, even when building a new home.
Congrats! You just matched at MUSC! And the #1 City in the World, Charleston!
The Pulse Charleston is a real estate team who specializes in relocating medical professionals to and from the area. Over the years, we have built the largest network of past clients who are currently working at MUSC, and we would love to help you too!
One of us is always available to show houses or answer questions. We copy each other on every email, so don’t be afraid to reach out to either of us and expect both of us to work on your relocation. Two people working on your behalf!
The doctor loan is a fantastic option for you. It is 100% financing with no mortgage insurance. The banks don’t use your student loan debt in your debt to income ratio as long as your loans are deferred, and you are able to close on a home up to 60 days before starting your program. The going rate for a 7/1 year ARM is really low, which is what most of our residents pick because they know they won’t be in the area forever. You will have a lower mortgage payment, including taxes and insurance, than your rent would be. It is a fantastic opportunity for you.
Our rental capacity is at 97%, so it is very frustrating finding a rental and then keeping it for the entire residency. Based on your salary alone at MUSC, you can usually qualify up to $300,000 depending on your credit score, and if you don’t have any revolving payments (like a car loan or credit card). Of course, if you have a spouse who has a job in the area that starts around the same time as you, their income can be added as well allowing you to qualify for more.
We saw a lot of our clients leave the area this past year after completing their residencies. After selling their home, all left the closing table with $30,000-%55,000, depending on how long they were in the area. All basically lived in Charleston for free while they were here. That definitely beats sinking that money or more into a rental and never seeing it again.
Most of our clients who are residents/fellows live on James Island, Johns Island, or in Park Circle or West Ashley. Some choose to live in Mount Pleasant or on Daniel Island, but it is more expensive.
We would be happy to meet with you when you come into town. Feel free to contact us to speak further about your relocation. Congrats again!