Buying a new construction home in a sub division with lower cost homes being built

[Uconn97]

Interesting thread. My wife and I are in the process of looking for our next one as well. We toured some new homes that are being built within a subdivision that was started about 10 years ago. The subdivision has been done in phases and they are about to start the final phase. I was surprised to find out that the new houses will start at $600,000 because 3 homes in the older part of the subdivision that are anywhere from 5-10 years old are on the market and are priced at $500,000 or less. These are all larger homes with very nice finishes on comparable lots. Granted I would expect to pay more for a brand new house, but $100,000+++ more seems a bit ridiculous. I told my wife I would rather buy the 5-10 year old ones and not spend the extra $100K just to say we have a new home! Most of the older houses are very nice and just need some basic updates which would cost way less than $100K to upgrade to our tastes. I wonder how many of these $600,000+ homes the builder will actually end up building. we'll see...

[casey7083]

I agree. I think you will find a MUCH better deal finding an existing home, even just a couple of years old in the same neighborhood you are looking in..you could save thousands!

This has happened in many neighborhoods in my area. Some of them have plans for smaller additions next to them, but I know of one where they started building very nice houses but nobody was building, so they started building cheaper houses all around there to fill up space.

As far as keeping appraisal value, I would not want to build on the expensive side. You don't want the nicest house in the neighborhood for sure.

[Vitaliano1]

I have kinda the same question,,,maybe someone can help,,,,
We are looking to purchase a single family home at $120 that was built in 2004- they are building New Build homes starting at $160k in same community same street/ same block- will the value of the older home we are purchasing go up when these are completed? Sq ft is the same , or bigger on older home than one of the 3 new build models.
We are trying to decide if this is a good investment property or not.....?

[rrah]

Your "new" home will be 10 years older than those going up now. That will be reflected in any appraisal done in the future. The larger size of the one you are considering will also be reflected so depending on how much bigger it is, that may equal out.

One also has to look at the upgrades in the house, etc.