Home buyers who are looking for a new property might have noticed that listings for brand-new houses are a bit thin on the ground. Realty Trac carried out a recent survey and found that 71% of single-family homes in the US had been built before 1990, while in some states homes built before this time account for 80% of recent property sales.
The article in aol.com goes on to point out that the dearth of new homes is as a result of the recent real estate crash. Five years ago new home construction just about ground to a halt, and although it’s beginning to pick up, the big developers are still reluctant to commit to projects. Figures for this year show the construction of new homes is still 40% below long-term averages. In addition builders have chosen to increasingly focus their attention on building multifamily homes. Any single-family homes coming onto the market often cannot be accessed by individual buyers as they tend to be picked up by investors for use as rental properties.
According to the survey by Realty Trac, the average price for a home built before 1990 is 9% less than newer homes in the same area. In some areas where there are large supplies of older homes then the price differences are even more notable. In some cases older homes can cost less than half the price of a new home. The location and age of the home do affect the price. For instance homes built before 1940 often have interesting features such as large staircases, intricate molding and exposed brick. In some areas in particular Houston and Boston, homes built early last century tend to be costlier than modern homes. In contrast some postwar homes tend to include features that have since gone out of fashion, and many are a lot smaller than the typical new home today.
In spite of the drawbacks to owning an older home, experts point out that if you’re willing to do some major work on the layout and rehab of an older property you might be able to get excellent value for money. However the downside is that it will increase the cost of ownership, and older properties often tend to be more expensive to run. A recent study carried out by the National Association of Home builders found that first-year costs of home-ownership tended to be 23% lower for newer homes compared to properties built before 1960. Experts advise that home buyers walk through with their inspector as this is a great opportunity to learn more about their prospective property.