Are you planning on buying a house soon? Before buying, it is important to study all your options, which is rather dizzying! A property acquisition encompasses a ton of decisions and choices, and each one must meet your needs. How can you find out if you should buy a new or used house? Let’s demystify everything together!
Whether you are looking for a new construction or a used home, several factors will be used in your decision process:
Property’s Purchase Price
Acquiring a home is a big investment. Moreover, buying a new one is usually more expensive. The difference can be justified by the selling price, already higher, landscaping expenses, taxes (GST and QST), and all the extras you wish to add, such as security devices, different materials than the ones included in the contract, etc. Most of the time, the house is sold by a real estate developer, reducing your negotiation power. You should also know that you might be eligible to government’s tax credits when going for a new construction.
As for used houses, you will probably pay less, since it is easier to negotiate with the seller. In addition, you will not have to pay GST or QST; this could allow you to make small renovations in the house, or to acquire a property with a slightly higher value. Don’t forget that you will have to pay the welcome tax at the moment of the transaction.
By acquiring a new home, you ensure that you will not have big renovations to do before a few years. However, it is not the case when you buy a used home. Maintenance costs are usually higher and you are more exposed to unforeseen events such as hidden defects. It is important to have the home thoroughly inspected prior to purchase and to plan a budget for the required works to be done.
New houses are built according to the new standards, you should have no surprises. However, find out about the builder’s past achievements and make sure the details are clear and agreed when signing the sales contract. You should usually be protected by a guarantee, which means that construction related problems, if any, would be at the contractor’s expense.
Buying a House… and its Neighborhood
Do not forget that no matter the house you buy, you buy the neighborhood with it. The property location in relation to amenities must be consistent with your needs. There is also often less vegetation in newly developed neighbourhoods, as opposite to well-established ones.
Time to Spend on Your Home
A house takes time, new or used. However, a multi-year property may require more in the long term. Indeed, renovations and maintenance will surely be more demanding. When looking into a new house, it will take a lot of time to design and build due to site visits and customization options. However, once those steps are completed, you will not need to invest as much time.
Consider Energy Efficiency
It’s hard to ignore energy efficiency as it could affect your electricity bill. Recent properties are built according to new, stricter standards. Thus, a new house will cost less energy than an older comparable one. In case you would like to buy an older property, it may be worth choosing a home that has already undergone insulation renovations. You could also do this kind of work after the purchase, but make sure that the future savings justify the costs of doing so.
These factors will guide you in taking the best decision. It is important that your head is involved in the process of informed purchase, but we also wish you a crush for your next home!