Budget, time, flexibility - there’s a lot that goes into this decision.

If you’re looking to buy a home in the near future, you may be wondering whether it’s better to build or buy. The answer typically comes down to three things:

• Your budget
• Your patience 
• Your flexibility regarding your “dream”

All of the pros and cons covered below boil down to your capacity in these areas. First, let’s look at costs.

Cost of building a house vs. buying

• The average price for a home in the U.S. is $367,711 (Zillow) 
• The average cost to build a new house in the U.S. is $439,000 (Zillow)

That’s a national average, and you may find different numbers depending on your region. But the trend is the same: It costs more to build than to buy.

But budget isn’t the only factor in this decision. Let’s dive into both scenarios to see which option may work best for you.

Pros & cons of building a house

The thought of building your own home is exciting—so many custom features and ways to put your mark on your residence. Before you get lost in the daydream of building your own house, here are some of the realities to consider:

Pros

• You can customize and personalize almost every detail of your new home—and you only have to pay for the custom features you want.
• You will have a home that is built to meet current building codes, as well as incorporate energy-efficient features and up-to-date technology.
• Your yard is an empty canvas to fill with the landscaping of your choice.

Cons

• You can’t move in right away. Be prepared to stay in your current residence when you build. The average construction time for a new home is eight months, according to the U.S. Census Bureau.
• You will likely have a lot more yard work to do (or costs for a landscaping service). Newly built homes rarely have mature landscaping. Get ready to put in some extra time or extra budget (or both).
• You may have out-of-pocket expenses sneak up on you. Before you start building, talk to your builder about base price, what buyers typically spend on upgrades and any additional potential costs at closing.
• You will have less room to negotiate when it comes to closing costs or purchase price.

Building a new home requires patience. If you're okay with the wait and willing to spend a little more to get the personal touches you want, then this option could grant you the home of your dreams.

Pros & cons of buying a house

In many respects, buying a house is a lot less stressful than building one. No scouting out plots, no picking out countertops. Already taken care of. But does that take all the fun out of a new home? Let’s take a look at the pros and cons:

Pros

• You can work with a real estate agent who can help you negotiate a terrific deal.
• You typically don’t have to wait long to move in; simply set up house right after you close.
• You can make upgrades at your own pace.

Cons

• You may have to deal with maintenance issues with an older home. However, your home inspection should uncover any potential issues and repairs before you close. You can also purchase a home warranty to help provide protection should any issues arise after buying your home.
• You could spend more for utilities when you live in an older home.
• You might regret your decision if you settled for a house that wasn’t at least somewhat close to meeting all your preferences.

Buying your next home is a great option, especially if you're working with a shorter timeframe for moving into a new home. While you might not get all of the features you want with an older home, you can make upgrades at your own pace. 

Build or buy?

Every buyer has different preferences, financial options and tolerances. Before you make up your mind, talk to others who have built and bought. They have ideas and lessons they can share with you. Finally, make sure to work with an experienced real estate agent who can help you find a home that meets your needs.

If you’re ready to speak with a Cadence Bank mortgage expert, contact us today.

This article is provided as a free service to you and is for general informational purposes only. Cadence Bank makes no representations or warranties as to the accuracy, completeness or timeliness of the content in the article. The article is not intended to provide legal, accounting or tax advice and should not be relied upon for such purposes.