If you've always lived in homes with "character," you may be excited at the thought of building your own custom home with every element just as you've planned it. But supervising the construction of a custom home can be an all-consuming process that may wind up being more expensive than purchasing an already constructed home. Read on for some of the pros, cons, and factors to consider when deciding whether to buy or build your next home.
Is Resale Value Important to You?
Even if your "must have" list is comprised of universally liked features, it's unlikely that your custom-built home will appeal to anyone else quite as much as it appeals to you. This means that any big bucks you shell out for ultra-customized elements may not be recouped during a sale, and in some cases, they can even make your home tougher to market. (For example, a gorgeous spiral staircase that leads to a loft area may appeal only to buyers who don't have young children and who are spry enough to navigate this staircase unassisted, significantly reducing the pool of potential buyers.)
Many who supervise the construction of their custom home are well aware that their hand-picked elements may not be everyone's cup of tea. However, if you're hoping to be able to get out of your home everything you put into it, you'll want to focus on custom elements that still have broad appeal.
How Long Do You Plan to Stay?
Most custom builds are more expensive than buying a house that's already on the market. As a result, paying extra for custom elements and then turning around and selling your home just a few years later may not be the most cost-effective option.
On the other hand, if you're planning to stay in your custom home for decades, it can make good sense to construct your home in a way that works well for your lifestyle, interests, and needs.
Is This Your Retirement Home?
If your long-term plans for your home include retirement, you'll want to make sure that it's designed to be as accessible as possible. Elements like wide doorways, minimal stairs, and large bathrooms can help create a home that you and your loved ones can grow old in with ease.
What Are Your Financing Options?
Already-built homes can generally be financed through a traditional mortgage, with a small-to-moderate down payment and a competitive interest rate. But constructing your own home from the ground up is much different; lenders won't generally extend a mortgage for a home that's not already built (and appraised), which means that you'll need a construction loan instead. These loans can have more stringent terms than traditional mortgages, and if your construction project goes over budget, you could find yourself with a far larger house payment than you expected.
If you're looking for a new home, speak with a professional about the pros and cons.Share