New home vs. old home: Which should you buy?

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Susan Meyer

Senior Editorial Manager

  • Licensed Insurance Agent — Property and Casualty

Susan is a licensed insurance agent and has worked as a writer and editor for over 10 years across a number of industries. She has worked at The Zebr…

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When it comes to buying a house, there are several factors to consider like location, price, size and even the friendliness of the neighbors. If you’re ready to purchase a home, you’ll also want to think about whether a new construction or existing home is the right fit for you. 

Although interest in newly built homes surged in 2020, with homebuyers’ preferences of modern appliances and energy efficiency, older homes certainly offer their own advantages as well, such as centralized locations, established neighborhoods and lower prices. So, who will win the battle between new home vs. old home? Read on or skip to our infographic to help you decide. 

Is it better to buy an old house or a new house? 

When it comes to which property type is best, there’s no short answer. The decision to buy a new house or old house will depend on the homebuyer’s own lifestyle and financial needs. To help make this decision easier, we’ve shared pros and cons to consider before buying each type of property below. 


The pros and cons of buying an old home 

Although interest in newly built houses has surged in recent years, there are several advantages that come with purchasing an existing home. Perks like price, location and availability are all factors that add to the charm of older homes and could be difficult to find with a new construction property.

The pros 

  • Established neighborhoods: Older neighborhoods are typically more established and are unlikely to undergo zoning or developmental changes, making your surroundings more predictable. 
  • More land: Land used to cost less than it does now, so builders could create homes on larger lots to accommodate for all your spatial needs. 
  • Central locations: Older residential areas tend to have more desirable locations and could be closer to city centers, grocery stores, restaurants, or other attractions. This could also boost your home’s property value because homeowners will pay a premium for access to nearby amenities. 
  • Affordability: Although factors like location and condition determine a property’s price, an existing home in the same area and the same size as a new construction will generally cost less to purchase. 
  • Availability: Existing homes are typically available to move into sooner than a new home or new construction that may be awaiting its finishing touches, assuming that no major renovations need to be made. 

The cons

  • History: While history can add a certain element of charm to a house, some historic homes could be considered stigmatized properties with stories that may not be so appealing. 
  • Outdated building code compliance: It wasn’t long ago that lead and asbestos were commonly used in construction of homes. Now, new houses can’t get approved by building inspectors without adhering to current building codes and health and safety regulations. If you’re considering purchasing an existing home, make sure to have it inspected for hazardous materials. 
  • Potentially more maintenance or repairs: Older construction means there could be more to fix. While older homes may cost less to purchase upfront, you could end up spending more on repairs and maintenance.

The pros and cons of buying a new home

Although new homes can be on the pricier side and in higher demand, there’s something to be said about walking into a brand-new home made just for you. Before taking the plunge, here are the pros and cons of making an investment in a new property. 

The pros 

  • Brand-new: When buying a new home, there are definitely benefits to everything being new. From appliances to flooring, everything is in pristine condition and you won’t have to worry about repairing anything the previous owners left behind. 
  • Customization: Sometimes your dream home hasn’t been built yet. With new construction, you may have the option to customize interior and exterior features as your house is being built.  
  • Energy efficiency: According to the Energy Information Administration (EIA), homes built in the United States after the year 2000 are more energy efficient than those built before then — which can save homeowners significant money on utility bills in the long run. 
  • Less maintenance: Purchasing a new construction home can reduce expenses that come with upkeep and home repairs in the first few years. That said, all homes need maintenance to keep them in good shape over time, so you’re not completely off the hook! 
  • Property value: You may have to pay more up front when purchasing a new home, but that also means that the resale price will be higher. Historically, new homes cost more than resale

The cons

  • Affordability: The median cost of a new home is more expensive than the median price of an older or existing home. However, this could give you a larger square footage and more interior features and amenities. 
  • Less room for negotiation: When buying an older or resale home, negotiating the price is typically part of the buying process. When you’re buying new construction, however, what you see is typically what you’re going to pay, plus any upgrades. 
  • Location: With less land available near high value areas, new construction properties tend to be placed further away from city centers, schools, hospitals, etc. 

Still conflicted on which property type is the right investment for you? Don’t worry — we’re not done yet. Below, we’ll discuss important financial considerations to review before taking the plunge.


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Cost considerations: old vs. new


Before making your final decision on which investment route you should take, be sure to review a few cost considerations that may differ based on the property type.

Which costs more? 

The median price of a new home is $355,400, while the median cost of an old home is $240,500. While newer homes tend to cost more up front, they are more energy-efficient and may require less maintenance than an older home. In the log run, this could reduce costly bills and expenses on repairs.

Cost of insurance

There are a number of factors that determine the cost of home insurance on a property, such as year built, roof condition, construction quality and special features (like swimming pools). That said, generally, the newer the home, the cheaper it will be to insure. Homeowner’s insurance for a new construction costs around 45% less than a home built 10 years ago. 

Whether you opt for an old home or a new home, the decision will be a big one. Make sure you do your research first so that you’re happy with your new home. Regardless of which decision you make, be sure to invest in the longevity of your home and protect your finances with the right home insurance