If you’re just beginning the home search process, you’re probably starting to realize that it can be overwhelming. There are many decisions to be made and it’s easy to get sidetracked or discouraged. One simple way to set yourself up for success from the beginning is to be very clear about your home search criteria and end goals.
Identifying your needs versus your wants is a good place to start. For example, once you’ve identified that you need a three-bedroom home with a small yard and a traditional floor plan, you can stop wasting time browsing through photos of that ultra-cool, modern loft that will never meet your lifestyle needs.
In addition to the price range, number of bedrooms, size of the closets, school district and proximity to shops and amenities, one of the most important decisions is whether you’re looking for a new construction, a remodel or a fixer-upper. Each type of home has its pros and cons that either make sense, or don’t, depending on your situation.
[See: The Best Apps for House Hunting.]
New Construction or Developer Remodel
Many buyers in today’s market are drawn to new construction and developer remodeled homes. And that’s because, well, it’s new. New construction homes have all new systems, new plumbing, new electrical, new appliances and more. When you’re making what is likely one of the most expensive purchases you will ever make, there is peace of mind knowing that everything is shiny, new and not in need of any immediate repairs or costly fixes.
Buyers are also drawn to new homes because they are current. Home builders and developers are designing homes to specifically target today’s buyer – well-designed new homes will incorporate the latest trends, styles and up-to-date technologies.
As in any home purchase, it’s important to do your research, ask questions and perform the recommended inspections. Not all builders are created equal and just because a home is new, doesn’t guarantee that there won’t be future issues.
Another reason buyers may be preferential to a new construction is once complete, new construction homes are entirely move-in ready. Life is complicated, moving is difficult and more and more buyers are looking for a home where they can just move in, unpack, and get on with the business of living. Some homes may even offer the option to buy completely furnished.
Unless you are having a home custom built to your specifications, one potential drawback to a new construction is that since everything is done, you don’t really have an opportunity to customize or make a home your own.
Some buyers may feel that a new construction home lacks personality because it has been designed to appeal to a larger buyer pool. However, some developers do allow certain customizations. Depending on the stage of development you may actually have an opportunity to customize certain features and finishes.
In a similar vein as new construction, there are many existing homes that have been completely remodeled by developers or builders, but they do not qualify as a new construction because part of the original structure still remains. Depending on the extent and quality of the remodel, many of these homes offer the same benefits of a completely new construction.
If a new construction home puts you out of your price range, you may want to consider an owner remodel. In many cases, owners have personally remodeled a home over time.
In owner remodels, cosmetic and aesthetic decisions may not be done to your specific taste, so you may still want to make changes. If systems were updated years ago they may be in need of upgrades or repairs in the immediate or near future.
A user remodel that has been well cared for and maintained allows you to move right in and also gives you the option to make changes over time. Knowing that you don’t necessarily need to invest in modifications right away also gives you more financial flexibility in your purchase.
On the other end of the spectrum is a fixer-upper. This type of property can encompass a range of homes from a complete gut to a cosmetic fixer. If you're considering purchasing a fixer-upper, the most important considerations are:
- How much work are you willing to do and how much work will it take to get a property to where you want it?
- Are you willing to add on or tear down walls or are you really only looking to update surfaces and materials?
Then the challenge becomes identifying properties that fall within that range.
If you’re in the market for a fixer-upper, it takes a certain amount of vision to look at a property in its current state and see what kind of potential it has. You may want to consider working with an experienced real estate agent who can help you to identify suitable properties.
In addition, if you’re working with a designer, contractor or architect, you will likely want to bring them to see potential properties before making an offer or during the contingency period of your escrow. Working with seasoned professionals is important so you’re clear about what can and can’t be done to a property, and for estimating the costs of various modifications.
If you’re looking at purchasing a fixer-upper, you’ll need to consider your timeline and living situation while your home is under construction. Will you be living off site or at the property while work is happening? Do you have a tight deadline for your move-in date? Some buyers who are on a tight timeline or limited budget may be hesitant to get involved in a large renovation project because of unexpected expenses and unforeseen road blocks.
However, one major plus for purchasing a fixer-upper is that you have the freedom to transform a property to truly make it your own and make it work for you. You have control of all of the design choices and the ability to create a property that meets your unique needs that may not already exist on the market.
When deciding which is right for you – new construction, user remodel or fixer-upper – the most important consideration is to balance your time, your budget, the things you need and the things you want.
The key to finding your perfect home is clearly identifying your present and long-term needs and lifestyle goals. Work with experienced professionals and be willing to shift your vision if you realize what you started out searching for no longer matches your objectives.
She is currently Executive Director of Luxury Estates with Compass in Beverly Hills, California. Her team, SFJ Group, is comprised of agents and a full-service staff ranging across experienced marketing, listing, transaction, and operation experts.