Fans of home-flipping shows may think they have what it takes to renovate a fixer-upper. However, in reality, they have a big decision when faced with buying a new or old home. With pros and cons to each, you must weigh your options carefully.

Advantages of Buying New Construction

Buying a new home has perks, such as being ready to move in from the start. If you’re planning a new construction, you can tweak features to your liking, from cabinet colors and styles to flooring. New homes also offer far more flexibility when it comes to the layout.

Of course, a new home offers more than just shiny, modern fixtures and finishes. It also means you get brand-new systems and appliances, including your home’s roof, plumbing, electrical, appliances and HVAC unit. With this comes builder’s and manufacturer’s warranties to cover defects, breakdowns and other issues you might face in the first couple of years of ownership. However, it’s important to note you’ll also have warranties for an older home.

Other advantages of buying a new home build include the following:

• Up to code with the latest building and safety standards

• Won’t require upfront costs for repairs

• May come with smart home technologies and energy-efficient products

• Often built in a new community with growth potential

Of course, a new community may mean you’ll have to wait for amenities. If it isn’t a problem for you, getting in at the ground level may be appealing.

How Does a Fixer-Upper Compare to a New Home Build?

New construction could be more expensive than a fixer-upper because of the latter’s condition. According to the U.S. Census Bureau, the median sales price of a new home was $426,300 in September 2024 — the average was $501,000. As such, people with a tight budget willing to get their hands dirty may be more inclined to buy a fixer-upper.

Whereas potential buyers can customize a new home to their liking, those who purchase a fixer-upper must work with the home’s existing layout and limitations. These older homes are ideal for do-it-yourself projects, but you must also be open to working with an experienced contractor to complete a renovation correctly. 

Conversely, new construction is primarily hands-off once the house is built. Leading up to it, you won’t have to worry about delays as new construction tends to have tighter timelines. However, if you want to build equity by reselling the house after renovating it, a fixer-upper is your best option.

What to Consider When Deciding Between New and Old Homes

Even with the advantages of new construction, buying a new home build versus a fixer-upper is a complex decision. There is much to consider before putting an offer down. First, you must decide whether to live in or sell the house as a flip. Older homes, in particular, require several expensive renovations to bring them up to today’s standards. 

For example, a fixer-upper may have foundation issues you’re unaware of — foreclosed or auction houses may not be inspected before the bidder takes possession. This repair could eat into your budget, considering cement costs saw double-digit increases year-over-year in September 2022. The same goes for plumbing and electrical upgrades.

Newer homes are often equipped with energy efficiency, fresh insulation and new appliances, helping you save money. The building warranties will also cover any structural defects. However, newer build neighborhoods may lack the characteristics you’ll find in homes in a traditional neighborhood — this may be important to some homeowners. 

The Hidden Costs of a Fixer-Upper

You could pay less for a fixer-upper — on average, an older home costs $225,000 in the U.S. — but you may be left to cover the costs of pricey repairs and replacements once you move in, such as a new $10,000 HVAC unit.

You should be aware of numerous hidden costs associated with fixer-uppers beforehand. For example, older homes are more susceptible to pest and mold problems, which are expensive to remediate. Mold removal is usually $1,223 to $3,749, while mitigating pest infestations is $250 to $850, depending on the severity. 

Other hidden costs may relate to construction permits, upgrades to meet municipal criteria, invisible structural issues and outdated systems. Of course, you may also need to factor in temporary housing costs if you can’t live on the property during renovation.

Historic homes, especially, may be more costly to fix. For one thing, you’ll need to invest in historically accurate materials to maintain the house’s integrity. You’ll also need to pay for specialized labor and underdog stricter permitting procedures.

It’s always best to consider how strict your budget is to determine if you can afford the hidden costs of a fixer-upper. If you can only afford a $450,000 house, you can buy a new home built on the high end of your budget or buy a home between $350,000 and $400,000 to upgrade the house as necessary.

Buy New or Old? It Comes Down to Budget

Buying something move-in ready may be more costly than an older house, but you won’t have to spend time or money on upgrades. Of course, if you have the budget and determination to take on projects, a fixer-upper could be your best option. Consider how much you’re willing to spend with enough saved for unexpected repairs. Then, make an informed and realistic decision for your household.

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