The Rachel Cruze Show - Building Vs. Buying a House: Which Is Better?

Starting point is 00:00:05 When it comes to home ownership, there's always the question of, hey, should we just build a house? Because I feel like there's a lot of new builds happening, or should we buy an existing one? Well, it turns out there are pros and cons to both. So today, we're going to talk about what you need to think through if you are considering building a house or buying an existing home and figuring out what's best for you and your family. Now, before we jump in, make sure to like, subscribe, and share this video with a friend. All right. Now, when you talk about home ownership, again, the housing market still is pretty crazy. I feel like it's like leveled out a little bit, but there's a lot of opinions out there about when to buy a home, what kind of home to buy.

Starting point is 00:00:43 And so I think understanding, okay, we are going to go and buy a home when you are in that position financially figuring out what is best for you to go and build something or to buy an existing home. Winston and I, we have done both. We have bought an existing home and the current home we're in, we built. But to give you an idea, kind of what we're thinking, let's break it down, the pros and cons. We'll start with building. So a pro to building, probably the most obvious that most people love, is that you get to make a lot of the decisions. So you get to customize, you know, possibly the floor plan, the finishes, the fixtures, like you really get to go in. And depending on the type of development that you're, you know, building in, the builder themselves, you know,

Starting point is 00:01:24 all of that, there can be a lot of decisions that you get to make or down to, like, you get to pick a floor plan that they have that's already existing. But the idea that you kind of get to put some touches of what you like from colors to finishes, all of that's really fun. And you kind of get to create your own. I see that as a major pro. Also, most of the time, it is less maintenance than an older home. So some brand new homes, some of them, they've gone up really fast and people find that they have a lot of issues. But if it's a really well-built home, then you're going to have new things, like appliances, roof, HVAC. And again, they should be able to last you for the next, you know, multiple years ahead, and you're not feeling like you have to go and

Starting point is 00:02:03 change it out, like if it's an older home. Also, low energy costs. So new homes, it should have the latest energy efficient systems, so you possibly are paying less when it comes to your bills in that way. Now the cons. Number one is the price, and this is probably the biggest con to consider, because on average, it costs $150,000 more to build a new house. And some of those, you know, factors really are hidden costs when it comes to upgrades, unforeseen problems, post-move costs. Like, the thing about building that people always say is like it's usually going to cost way more than you think and it's going to take longer than you think. So remembering that, it can get really, really expensive, really fast. You have to be very diligent on your budget. Also, no negotiations.

Starting point is 00:02:47 So unlike buying an existing home, there's not a lot of flexibility when it comes to closing costs or the purchase price of the home, what they're building and what the builder and how they make their money, it's pretty much just set in stone. Also, the wait. It could take a year to build a new home and have everything planned out, right? So it's the planning, the approvals, the construction, all of it. So it can take a lot longer to do that. And so if you are in a position where you don't have that time, that can definitely be a con. Now, a quick side note, if you're thinking about buying a home and that's kind of stressing you out, it might be time to start eliminating some stresses in your life in other areas. And that is one reason I recommend Delete Me.

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Starting point is 00:04:04 to leave exposed. So sign up for DeleteMe and take control. Go to join DeleteMe.com slash Rachel for 20% off, bringing your monthly cost to under $9. Or you can click the link in the description. All right, we've covered the building side, right? The pros and the cons. Now let's talk about buying an existing home. So the pro is the price. Again, building a home is going to be more expensive usually than buying an existing home. And most of the time, buying an existing home is going to be cheaper. Plus, you can negotiate a lower price and even like some repairs with the seller. Like, there's more on your side there. Also, there's a quicker close. Usually you can close in 30 to 60 days. And if you have a deadline that you need to be moving, that's usually a really good option.

Starting point is 00:04:51 Also is location. So by saving money on the house itself, you may be able to buy in a more expensive or desirable neighborhood or, you know, where you are in the city because you're going to be able to say, hey, there's some savings here. Maybe we can get in a better area with an existing home. All right. Let's talk about the cons. Number one is repairs. As homes get older, they're going to need more repairs, obviously. And according to the U.S. Census Bureau, older homes, especially those built before in 1950.

Starting point is 00:05:21 tend to cost significantly more to maintain. So major repairs, you know, think about a new roof or a water heater, like all of those can be really costly. And according to Home Advisor, the average new roof costs around $6,200 to $8,400. So sometimes insurance can get in there, but also, like, oh, it can be really tough. And then we have seen with older homes, you have to be on the lookout for mold, lead paint, like all of that. So just being aware, but your inspection hopefully will cover most of that. Also, you might have to face compromises. This is a con to buying because you're not building something from the ground up that you have all the control over, you're buying something existing. So it's probably not likely that you're going to find a house that checks all of your boxes. You're probably going to settle for a couple of things. So just remembering that.

Starting point is 00:06:09 Lastly, is updates. Obviously, if the house is outdated, you're going to have to put your style, your renovations in, which can cost more. So be thinking about that ahead of time. So if you're still not sure whether you should buy or build, that's okay. look at your options. That's the thing that gives me power always when I'm thinking about something. See multiple options. So if there's like a lot and you're like, maybe we should buy the lot and build on it later, maybe look at a couple of lots when you're looking at building or different neighborhoods or if there's a house, you know, look at different existing homes out there. Like have your options because I promise things will start to look at, you'll look at the pros and cons list and quickly you'll figure out like what is best for you guys.

Starting point is 00:06:47 But when you are financially ready to buy, it is so fun. This is a fun part of life. When you get to be a homeowner, it is. It's great. And I think, again, it could be very, very stressful in so many ways. So options give you power. Just remember that. Now, if you still want to learn more, make sure to check out the real estate home base. And this is going to give you so many resources when it comes to financing and buying, even selling your home. So make sure to check that out. And if you want to keep learning on what mistakes to avoid when selling, then keep watching my next episode, five mistakes to avoid when selling your home. You can click here, or or if you're listening on podcasts, I will leave a link below. All right, you guys, as always, make sure to take control of your money and create a life you love.

The Rachel Cruze Show - Building Vs. Buying a House: Which Is Better?

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