The Expert Podcast

So, have you done the math lately on buying a home versus building a home in this market? Many home buyers are finding that purchasing a new home is very, very expensive. In some cases, it’s unaffordable with the prices that resale homes have gone up and the interest rates. One way around that is to build your own property. Now, if you need a house immediately, it’s not going to work because it may take several months or up to a year to build a home. But if you’re currently renting or if you’re going to sell your existing house and buy a new house, building your own home might be an attractive option.

If you work the process properly, you can actually save a lot of money, even if you hire a full-service builder or general contractor. A lot of times, the cost is cheaper than buying a home. An article from Storage Cafe came out and did some research in different markets. They were focusing mostly on the Pacific Northwest, Oregon and Washington, but many parts of the South Atlantic have the same thing. In fact, most parts of the country, it’s actually cheaper to build than to buy an existing home.

The advantage of a new home is everything is brand new. Your roof, for example, now has that 20-year clock clicking from zero, rather than if you buy a resale house. Even if the roof is seven or eight years old, you still have to replace it after 12 years. So, you have a lot of advantages. Now, the downside to building a house is you have to go through that build process, which may add some stress and anxiety to the process because at each step, you’re going to be having to deal with permits, delays, and maybe backlogs of materials. But if you can get through that process, sometimes it’s even shorter than the process of finding the right new home.

How long have you been house shopping? If it’s been six or eight months or a year to find the right dream home, you might find that building a house might be less time than starting from scratch on house shopping for a resale home. Plus, you can have the design and layout exactly how you like it: colors, paint, flooring—exactly how you like it. It’s a lot easier to find a vacant lot than it is to find a built home. Again, there are always pros and cons, and that’s a subject for other videos we’ve done. But the big question is the pricing. Certainly, you can save money by doing the build process yourself; it’s always been the case. But right now, they’re showing that building a home may actually be cheaper across the board because of the spike in resale home prices, along with interest rates, that have put home buying out of reach for many consumers—first-time or even upgrade home buyers.