Your Guide to Buying a House vs Building a House in Arizona
When it comes to the dream of homeownership, one of the biggest decisions you’ll have to make is whether to buy an existing house or build a new one from scratch.
Arizona’s housing market overview report for June 2023 shows a reduction in the number of homes on the market by 22%.
This means purchasing a new home in the current market comes with a new set of challenges.
The most important thing is, will the home that you really want to purchase even be available to purchase?
However, on the flip side, the prices to purchase a home have come down, making it a bit more affordable.
Price drop of more than 22 percent in home values; this sudden downturn can be attributed to a combination of factors like an oversupply of homes on the market.
On the other hand, building a home offers customization and personalization on a whole other level. Time and money are very important factors to consider here.
Try to get a sense of the cost per square foot, based on how simple or opulent your vision is to get more insight into understanding the budget requirement to take this sort of project on.
If you find yourself undecided between buying a house vs building a house in Arizona, we have compiled a useful list of pros and cons below to assist you in this process.
Advantages of Buying a House vs Building a House in Arizona
Buying a house can be an exciting experience, but it’s important to get realistic about your expectations.
We’ve compiled three advantages below to help you along the way.
- ConvenienceWhile some buyers of custom houses enjoy being able to pick and choose the design elements, for others, it can be an overwhelming process. However, if you’re buying a house, it removes the guesswork and streamlines the process. That way, you can focus on more important things like where you’ll hang your plasma television.
- TimeIn between the research, tours, offers you make, and rejections, the home-buying process can sometimes feel as if it will take forever. But this is exactly what the journey to finding your home is like. Despite the speed bumps along the way, the time spent on these unexpected pitfalls is minimal compared to the time it would take to build a home from the ground up.
- CostThe median price of existing homes that sold averaged about $348,853, whereas the median cost of building a new home is about $416,300. The difference in price alone might be enough of a deciding factor to deter any new home dreams. Additionally, making an offer on an existing home also means buyers have a little bit of bargaining power if the home needs repairs or upgrades.
Disadvantages of Buying a House
Although existing homes have their appeal, there are common concerns that buyers frequently encounter.
Continue reading to learn about three common concerns that buyers often face.
Limited Choices
Nowadays, sellers have the ultimate advantage in today’s real estate market.
With the limited supply of homes, buyers can get extremely frustrated if they get outbid or miss a window of opportunity to make an offer.
If you find a house you like, you only have about 30 days before it’s off the market, according to the National Association of Realtors.
Disappointment
Disappointment is unavoidable when considering buying or building a house.
Buying an existing house means you inherit all the problems that came with the house, like tacky plaid wallpaper and outdated pink and blue tiles.
For potential owners who are creative types, it’s easier to look past these flaws and see the diamond in the rough.
Renovation Costs
Imagine envisioning your ideal cozy bungalow, only to be disappointed by a cramped floor plan and just one bathroom.
On top of purchasing the house, you find yourself burdened with the extra expense of renovations.
This unfortunate situation not only puts a dent in your finances but also leaves you dissatisfied.
It becomes a lose-lose scenario, where you’re financially strained and still left with an unfinished home.
FREQUENTLY ASKED QUESTIONS (FAQ)
- Is it better to build or buy a house in Arizona?
Generally, buying an existing home is cheaper than building a new one. But remember, by building your own home, you get a brand-new home customized to your needs. The cost of house building in Arizona ranges between $220,000 – $550,000, with the state average at $295,580.
- Is buying property in Arizona a good investment?
With a booming economy and one of the fastest-growing populations in the U.S., Arizona is a great place to invest in real estate. It offers several markets to invest in rental property, with home values rising rapidly each year.
- How much do you need to make a year to buy a house in Arizona?
According to a study by Visual Capitalist, a salary of more than $86,300 annually is needed for Phoenix residents to buy a home. Out of the 50 U.S. Metro areas selected in this report, Phoenix ranked 17th in the highest salary needed to buy a home in 2022.
- Why are Arizona homes so expensive?
The current shortages of housing supply, relative to demand, are a primary reason housing costs are increasing.
A significant increase in housing supply is necessary to keep pace with current and projected housing demand.
Advantages of Building a House vs Buying a House in Arizona
Choosing to build a new house can be one of the most rewarding experiences imaginable.
The sky is the limit with design and blueprint options, and many owners agree it’s deeply satisfying to be part of the process.
Read on for more reasons why it’s a great option.
Customizable
One of the biggest draws of building a custom home in Arizona is the idea that you get to start from scratch.
From the flooring to the paint color to the kitchen cabinets and counters, the choices are endless.
Because of these options, the style of your new house will feel more personal.
Energy Efficiency
Goodbye to high water and electric bills. Hello, energy efficiency.
One of the best things about buying a new house is the technology that accompanies it.
Because it has to be up to code, new house owners can reap the benefits like improved air filtration systems and environmentally sound energy.
Low Maintenance
With everything new in a custom-built house, this means limited or non-existent repairs.
If something were to malfunction or break, new houses typically have a generous warranty that covers repairs and replacement of the items.
Disadvantages of Building a House
For first-time home builders, there are sometimes a few unexpected issues that can lead to disappointment.
While it’s true that challenges can occur, it’s crucial to be conscious of avoiding mistakes during the construction of a new home.
Keep in mind f these common concerns below to avoid any surprises along the way.
Construction Always Takes Longer
Building a house in Arizona comes with potential delays due to factors like weather conditions and permit procedures.
Extreme heat and heavy rain can disrupt construction timelines while obtaining permits involves navigating regulations and paperwork.
Patience is key as construction often takes longer than expected, but understanding and preparation can help ease the burden of extended deadlines or in some cases, you can avoid delays due to your more proactive approach.
Set Price
Unlike buying an existing home, there is no haggling when it comes to buying a new home.
The sticker price is pretty straightforward, so you should know what your budget is going into the process.
Otherwise, disappointment will likely replace your initial excitement. More on that next…
Watch Out for Price Upgrades
When building a house in Arizona, it’s crucial to consider potential adjustments to the scope of the project or materials that can impact your budget.
Adjustments and upgrades in materials or design choices during construction can significantly affect costs.
A thorough evaluation of whether the upgrade is a necessity and if the upgrade fits within the overall budget is key to maintaining your desired budget and avoiding financial surprises.
HOA Fees Can Add Up
Another cost that can sneak into the price of a new house is Homeowners Association fees.
HOAs can sometimes be expensive and surprisingly restrictive, so make sure to read up on the rules and costs.
Make Sure Your Decision is an Easy One
If you’re deciding between buying or building a house in Arizona, we hope our guide has provided you with some useful information that helps make your final decision a little easier.
If you’ve decided a custom-built house is your preferred approach to your next home, Contact us and share about your vision.
We have decades of experience and are excited to bring your dream to reality.
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Considering partnering with a reputable custom home builder in Arizona that can turn your vision into reality? We at Peak One Builders & Restoration can work with you to build the home of your dreams! Request a free estimate or call 480-481-5150 now!
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