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Moving into a new home is an exciting time for you and your family. You’ve saved hard for a down payment to call your dream home your own, but now you can’t seem to find the right property.
The market moves quickly in the Fox Valley, but don’t let them dissuade you from searching. There are more options out there than you might think, and this guide will help you to decide whether buying a house or building your new home is the right decision for you.
Buying a House in the Fox Valley
Advantages
When it comes to buying a house, it’s certainly the most convenient and cost-effective option in many ways. The mortgage process is often more straightforward, which is important to consider whether you’re an experienced home-owner or a first-time buyer getting your first Fox Valley mortgage loan.
From the bank’s perspective, a home loan is much less risky than a land loan, so you’ll often get a better interest rate and a lower down payment requirement. This means it is very likely that you’ll receive a pre-qualification for your mortgage, which also helps to cut down the time when you’re searching for a new home and making offers. When you’re looking for home loans in the Fox Valley, saving time here can be the difference between getting the house of your dreams or missing out to another buyer.
With an existing home, there’s also the possibility of price negotiation (depending on the current state of the market). It may be move-in ready, but there’s usually room to maneuver with the cost of the property, seller’s assistance, or any other closing costs or maintenance allowances that are made during the sale.
Disadvantages
With the advantages also come the disadvantages. If you have your heart set on an older property, there can be significant maintenance or renovation costs involved. Unlike a new build, you also may not be able to customize your home in the way that you’d like, which is especially true of pre-1900s buildings.
These homes are known to have small rooms and lack the open-plan layout that many homebuyers are looking for. Even if expansion is possible, this will be an added expense that will need to be accounted for in the overall cost of the home.
Another disadvantage is that, if the market is moving quickly and you need to sell your existing property, you may be forced to settle for something less than your dream house. Homes in Wisconsin sell quickly, sometimes before buyers have a chance to view the house. Not only are you competing with other buyers on the price, but you’re also hoping that you can lock down an offer before they do.
Building a House in the Fox Valley
Advantages
One alternative to buying a home is building. With a new build, you’ll get exactly the look and feel that you want from your dream home. Everything from the floor plan, to the cabinet finish and paint are yours to customize.
You’ll also be able to avoid competing offers from other buyers, unless the piece of land that you’re after is particularly advantageous. While it may take longer to finalize than an existing home, the process can be less stressful when you know that the house is definitely yours.
As with anything that’s new, building a house allows you to avoid some of the unexpected maintenance costs that can come with a house purchase. HVAC systems, appliances, and roofing will all be new and come with their original warranties, meaning that you won’t need to think about paying for any potential problems for years to come.
Disadvantages
Since building a home can take anywhere from a few months to over a year, there’s a real possibility that you may be paying for two houses at the same time while you wait for the build to be completed. Whether you’re paying for both mortgages at once, or you’re renting until the new house is ready, that’s a sizable amount of money that you’ll need to budget for each month.
Along with the possibility of additional costs or contractor complications, there’s also the chance that financing the build could be more difficult than applying for a conventional mortgage. Expect to see higher interest rates for land loans and the approval process to take longer, particularly if you’re still paying another mortgage on an existing property.
Working with a lender like BLC Community Bank can help you to find a Fox Valley construction loan that works for your situation and can alleviate some of those extra stresses that come with building loans.
Choosing an option based on your priorities
If budget is your primary concern, there are several options to consider. A construction loan for a new home may help you to avoid maintenance costs once you’re all moved in, but the transition period from one home to the next may be too costly for you.
On the other hand, finding an existing property that’s in perfect condition, within your price range, and with little competition from other buyers can feel like finding a needle in a haystack. Building a home may prove to be the more cost-effective solution in this case.
Particularly if you’re looking at homes that need significant renovation upfront and aren’t move-in ready, starting from scratch can be cheaper. That goes for design too. If the floorplan of an existing home isn’t to your taste, can you afford to fix that now or are you happy to live with it as-is until you can fund that project?
A new build can also offer long-term costs savings, along with positive environmental impact, by giving you the option to add energy-saving measures like solar panels. While it’s possible to make this addition to an existing home, you may be able to benefit from wholesale discounts if you work through your building contractor, rather than a solar power company directly.
There’s also timing to consider. Depending on how quickly a seller in an existing home can move out, and how fast you’re able to sell your current property, you could be in your new house within a couple of months. If you’re trying to plan around starting a new job, the beginning of the school year, or the arrival of a new baby, being able to work within a fixed timeline can be helpful.
New builds are known for running over construction timelines thanks to contractor scheduling conflicts or supply chain delays, so this is something to think about if you’re on a time crunch.
Find your dream home in the Fox Valley
Whether you’re looking to buy or build, BLC Community Bank is here to support you with expert mortgage lending in the Fox Valley. Create the home you’ve always wanted with a construction loan, or get ready to move into the perfect family home with a pre-approved conventional mortgage.
Our lenders love to welcome new families to our community and help long-time residents find their forever home. The team at BLC Community Bank are the perfect combination of experience and local, personalized service to work with your unique needs. All lending decisions are made by individuals who understand our local area and want to see our community prosper with people like you!
Find out more about mortgage lending and start the pre-qualification process today.
