Should You Build or Buy a Home? Comparing Risks and Benefits 

Home Mortgage Info Should You Build or Buy a Home? Comparing Risks and Benefits 

A home is one of the most important investments that you will make, and most likely, you will spend a lot of time trying to find the “perfect home” for you. But top of every home buyer’s mind is the question of whether to build a home or buy an existing one. There is no right or wrong answer, but the right choice highly depends on your own situation and what your preferences are.

So before you decide on how to acquire your dream home, here is a comparison of the risks and benefits of both building a home and buying one.

Building a Home: Benefits and Risks


  • You have full control of the customization. The primary reason why you would want to build a home over buying one is customization. From the layout of the rooms down to the color of your floor tiles, you have the ability to personalize your home however you want. You get exactly what you want, barring the availability of the materials and furnishings. You can also pick and choose who you want to work with in terms of contractors and suppliers. You of course would want to work with one with a stellar reputation and a portfolio of completed construction projects.
  • Your new home is protected by a new construction warranty. Reputable home builders offer warranties when building a new home. These warranties vary between home builders, but they should be able to cover both mechanical issues such as plumbing and electrical issues as well as cosmetic issues which include paint and furnishings. And since everything is new and under warranty, there is less maintenance needed.  


  • You need to pay more upfront. You may have full control of the look of your home and are protected by a new construction warranty, but it comes with a cost. The biggest disadvantage of buying a home is its price. From purchasing the lot where it will be built to buying the furnishings to personalize it, everything will have a higher cost in total compared to just buying an existing home. 
  • New home construction takes a long time. The typical duration to finish a new home construction is around seven months. You may need to rent a place to stay If you are selling your old home to move into the new one, which is another additional cost to take into account. 

Buying a Home: Benefits and Risks


  • Buying a home is more convenient. Should you decide on buying an existing home, you will find that it is less stressful than building one. That’s because the process of purchasing one has been streamlined and guided by a real estate agent and a mortgage lender. Once you get the home valued and your home loan is approved, you can immediately move-in when the documentation is done. 
  • You can choose to reside in a developed neighborhood. Most new construction homes are built in new developments instead of established neighborhoods. There may be a lack of amenities, not to mention the noise from nearby construction. If you are going to purchase an existing one, you may do so in a developed neighborhood that has the accessibility and amenities you deem important. Commuting is a huge part of everyone’s day-to-day life so a house with easy access to the roads should be your choice. 


  • You may encounter maintenance issues. One of the biggest risks of buying an existing home is the potential problems that only become apparent when you are finally living in it. You need the services of a professional home inspector to find these problems before closing the deal. 
  • Not everything might be to your liking. Since it is an existing home, there might be some aspects of its design that you may not really like. Buying a home is cheaper than building one, but you may need to do some home improvements and renovations to customize it to your own preferences. 

Deciding between building a home and buying one is not easy. You will need to consider your budget, preferences, and your preferred timeline when you need it. Consider the benefits and the risks listed above carefully and decide which one fits more within your situation. 

About the Author:

Chris Woodard is the Co-Founder of, where they build software that helps contractors, subcontractors, and material suppliers secure their lien rights and get paid faster by automating the collection process for unpaid construction invoices.




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