10 Reasons Buyers Choose New Over Resale By Pat Curry
(BUILDER, January 2005)

The house had a great backyard, skylights in the kitchen, and a spacious master bedroom. Petri Darby and his fiancée, Shannon, were definitely interested that summer afternoon in 2002. Then, they walked into the closet and saw a pile of clothes in the laundry hamper.

“On the floor were these dirty purple panties,” says Darby, who works as a marketing director at a Houston law firm. “I stopped dead in my tracks and looked at my fiancée. Our eyes got huge, and we both said, “This is definitely not the house.”

The image nagged at them every time they went into another resale house. “We kept thinking. What’s been on this floor, this wall? What aren’t they telling us?” Darby says.

They also kept comparing every house to the model home they’d seen in a Ryland Homes neighborhood in a development called Stone Forest in the city of Spring, about 25 miles from downtown Houston.

One look at the three-bedroom, two-bath Bordeaux model and they were hooked. They loved how light flooded the rooms and the flexibility of the 2,356 square-foot floor plan. Everything about the house felt right to them.

“The prospect of starting our lives together in our own home that no one else had lived in offered that fairy-tale opportunity,” he says. They put down a deposit that evening.

Watching their house being built was so exhilarating they made a scrapbook of the construction process. And when things seemed as if they just couldn’t get any better, they met their new next-door neighbors.

“They were standing outside and said, “Would you like a beer?” We stood on the porch, having a beer, and watched our house being built. …Looking back on that is a fun experience. It was like seeing your dreams being built from the ground up.”

For the Darbys, the appeal of buying a new home was so strong they couldn’t imagine why anyone would buy resale unless they needed a house in a hurry. Still, rising construction prices, the need to build farther from urban centers, and the range of resale options can leave buyers – and builders – asking just the opposite: Why would anyone buy a new house.

Buyers most often cite the following 10 reasons for buying a new home:

1. EASE OF MAINTENANCE. New homes don’t require as much upkeep as older houses, and many are built with low- or no-maintenance materials, says Valerie Patterson, senior editor of RealEstateJournal.com, The Wall Street Journal’s online guide to property. Today’s buyers often have families or are planning families and don’t have time to spend on house projects.

   That was the No. 1 reason Quinn and Melody Warnick bought a new house when they moved from Maryland to St. George, Utah, in 2003.

   “We were moving from a 50-year-old monstrosity, so a brand-new home was like our fondest dream come true,” Melody say. “There’s something cool about living in an older house – it has a little more character – but it’s only fun to a point, and then you want your weekends back. The new home was in pristine condition. Everything was up-to-date and modern and worked, which was a miracle.”

   Many new home owners also don’t have the knowledge or tools to do extensive home repairs, Patterson notes.

   “Years ago, fathers passed along a certain range of repair and fix-it-skills to children,” Patterson says. “Somewhere along the way that’s been breaking down. Some people don’t have the confidence to even drill a hole in the drywall to hang a picture."

   Even if they were handy with household repairs, Eric and Katie Wilkinson say they’d rather not spend their time on those chores. In their new four-bedroom home built by Sundquist Homes in the Mint Grove development in Mountlake Terrace, Wash., they don’t have to worry about them.

   “We aren’t very handy,” Katie says. “With what little time we do have with our children, we don’t want to spend that time repairing floors.”

2. PERSONALIZATION. Buyers love the fact that they choose their own paint colors, cabinets, countertops, carpet, plumbing and lighting fixtures, and countless other items. Instead of a house that they’ll have to spend months, or even years, repainting, refinishing, or re-carpeting, they get a home that feels like their own the day they walk in the door.

   The ability to customize was the biggest factor in the decision to buy new for Jodi Helmer and Jeff Paramchuk, who bought a 1,700 square-foot house from JLS Custom Homes in Beaverton, ORE.

   “We wanted to be able to choose the cabinets, flooring, tile and other decorative elements,” Helmer says, “[and to] have a say in where the outlets, walls and other structural elements were placed so the house truly worked for our needs. As a result, our home truly reflects our tastes and lifestyle. We may have spent a little more money up front to customize, but I think we saved in the long run, because we won’t have to hire contractors to alter the house to suit our desires.”

   Chris and Apryl Thomas Chapman of Watkinsville, GA., saw the selection process for their new four-bedroom home by Power Builders in the Oconee Crossing development as part of a long-term investment.

   “We looked at the purchase as something we would live in for 30 years or more,” says Apryl. “We wanted something that we liked, that reflected our personal touches. We didn’t want to spend extra money for new carpet or paint. If it’s going to be an investment, we want it the way we want it.”

3. INSTANT COMMUNITY. Buyers appreciate that they’ll have something in common with their neighbors, whether it’s families with young children or active adults, says Mitchell Hochberg, president and CEO of WCI Spectrum Communities in Valhalla, NY. “Community living has become much more appealing, whether it’s a (traditional neighborhood development) with a meetinghouse or a clubhouse,” Hochberg say. “People are looking for more interaction with neighbors.”

   Katie Wilkinson says she didn’t realize just how critical this was to her family until they moved into their house. “We will never again, while our kids are young, live without sidewalks and a playground and neighbors with families, “she says. “(Those things are) a huge blessing.”

   It’s not just an issue for young families with small children, either. Bob and Christine Patti bought a Shea Homes house in Sage Meadows in Simi Valley, Calif., in 1999 after having owned four existing houses in various parts of the country. They intentionally downsized from a 2,900 square-foot house to a 2,100 square-foot home because the last of their three children had headed off to college and they didn’t see the need (and didn’t want the cost) for maintaining the extra space and a pool any longer.

   “We preferred a new development,” Bob says. “After having prior homes in established neighborhoods, we thought it would be easier to get acquainted with others who were not yet established as well.”

4. FLOOR PLANS FOR TODAY’S LIFESTYLE. The floor plans of new houses are much more in keeping with the way people live today, Hochberg says. Kitchens are more open and are integrated with living spaces to gather families together. Master suites with luxurious baths and sitting areas are restful retreats.

   An open floor plan made an impact on the Wilkinson, who were just starting their family – they have two young daughters – when they bought their house.

   “It has high ceilings and open spaces, so we can see what these monkeys are up to at all times,” Katie Wilkinson says. “It’s a good plan for a young family.”

   The Darbys say they love the flexibility of the floor plan of their house, with front and back porches and a side patio. There’s a technology nook near the kitchen and a study off the master suite that Petri uses as a home office. When they start a family, it will easily convert to a nursery.

   Compare that with the Warnicks’ 50 year-old house with a tiny, outdated kitchen that lacked storage and closet space. A wall between the kitchen and dining room made both rooms seem even smaller.

5. ENERGY EFFICIENCY. New construction techniques, materials, and appliances all work together to dramatically lower utility bills that can save families money on heating and cooling costs. The Warnicks report that they saw significant changes in their energy costs when they moved into their new home.

   “We were agog,” Melody says. “The weather in St. George is over 90 degrees for several months during the summer. Having low-E windows was a big benefit.”

   Energy efficiency was important for Helmer because it helped offset the cost of buying a new home.

   “Buying a house is expensive,” she says, “so not paying skyhigh heating bills during the winter because the house lacks insulation and updated windows was a definite selling point.””

6. APPRECIATION IN VALUE. Virtually all new homes appreciate quickly, says Jerry Kienlen, a sales associate with Burgdorff ERA in Basking Ridge, NJ. “Builders say the first buyer makes more money than the builder does,” Kienlen says. “I’ve found that generally to be true. The appreciation is significant.”

   Patterson from RealEstateJournal.com confirms Kienlen’s observation. She says new-home buyers have experienced “major run-ups in prices in the past five years. It hasn’t mattered what kind of house it is.”

   The Wilkinsons have already seen it. The houses that are being built in the next development from theirs are selling now for $100,000 more than they paid for their house two years ago.

7. SAFETY. Old homes often have hazards such as asbestos, lead-based paint, leaking gas lines, or faulty wiring. Plus they may predate current building codes for safety glass in windows or for severe weather or disasters such as hurricanes or earthquakes. New homes are built with materials that have been tested to meet the strictest safety standards.

The Warnicks “thought about safety. Our (old) house had some crazy electrical stuff. You’d go into the basement and there were wires everywhere. With a baby, I worried about having an electrical fire,” says Melody.

8. TECHNOLOGY. It’s much simpler and more cost effective to install technology options in a new home than to retrofit an old home, Hochberg says. A major component in options and upgrades, it’s sometimes impossible to install in an existing house.

   That doesn’t mean builders have to offer a home theater system to catch a buyer’s attention. For the Warnicks, it was as simple as having plenty of outlets, phone jacks, and cable boxes.

   “It gave you a lot more flexibility in where to put things, “Melody says. “In our older home we didn’t have an electrical outlet in the bathroom, so you had to set up a corner in the bedroom to blow-dry your hair. In this house we didn’t have to say “The television has to go on this wall because that’s where the only outlet is.”

9. WARRANTIES AND CUSTOMER SERVICE. Resale-home buyers often purchase a one-year home warranty, which covers appliances and some major systems, says Sierra Wilson, spokesperson for KB Home. New homes typically come with a more complete warranty. Having the builder available if buyers need help provides an added sense of security.

   “This was a big deal,” Helmer says. “We don’t have the skills to handle major repairs on our own. We wanted a home that was move-in ready without the worry of whether we’d have to replace the roof next summer or deal with an outdated heating system this winter.”

10. LEAD TIME. Purchasing a new home gives buyers lead time to sell their own home and to do some planning, Kienlen says. That’s less predictable on resale houses. “It’s been a seller’s market,” He says. “If you sell your house first, you might be under pressure to accept something less than you want.”

    It can be particularly important for relocation buyers such as the Warnicks, who were moving cross-country. “If we’d had to try to coordinate with existing owners,” Melody Warnick says, “it would have been harder.”