Ask Stacy: Should I Buy a Used or New Home?

Couple Home Fix Up Painting
Photo by Mandy Godbehear / Shutterstock.com

Welcome to “Ask Stacy,” a short video feature answering money questions submitted by readers and viewers. You can learn how to send in a question of your own below.

If you’re not typically a video watcher, give it a try. These videos are short and painless, and you’ll learn something valuable. But if you can’t deal with video, no problem: Just scroll down this page for the full transcript of the video, as well as some reader resources.

Today’s question is about whether it’s best to buy a brand-new home or a used one.

Personally, I’ve always opted for pre-owned homes, primarily because I wanted to create sweat equity by fixing them up. But now that I’m reaching retirement age, I’m thinking of buying new. Which is best for you? Here’s what I think.

For more information on this topic, check out “20 Tips for Buying a Home in the Best Location, Location, Location” and “Find Your Dream Home — Step by Step.” You can also go to the search at the top of this page, put in the words “home buying” and find plenty of information on just about everything relating to this topic.

Got a question of your own to ask? Scroll down past the transcript.

Don’t want to watch? Here’s what I said in the video

Hello and welcome to your money Q&A question of the day. I’m your host, Stacy Johnson, and this answer is brought to you by MoneyTalksNews.com, serving up the best in personal finance, news and advice since 1991.

Let’s get right to our question. It comes from Jill:

“You always recommend buying a used car as opposed to buying a new car. Is the same true for purchasing a home? Is it better to buy an existing home?”

Jill, that’s a great question.

I’ve always bought older homes, fixed them up, put in my own time and money, and created sweat equity. However, now that I’m getting near retirement age, I’m considering another home, and this time I’m thinking about getting a new one because I’m tired of working on my house all the time.

Here are a few things to consider when approaching this question for yourself.

First, cost. According to Zillow, new homes cost 20 percent more than used. That’s a big premium: When you’re talking about a $300,000 house, 20 percent is 60 grand. So, you’re paying a lot of extra money to get a new home over an existing one.

On the other hand, older homes are going to cost a lot more to maintain. In fact, I spend more time working on this house than I care to admit. Not only is it expensive, it’s also a pain. It takes up a lot of spare time that I might otherwise use to do something a little more fun.

So, new homes cost more to buy and less to maintain, which could balance out. Whether that’s true will depend on how much extra you’re paying for a new home, how much work the used home needs, and whether you’re willing and able to do work yourself.

Another thing to consider is that you might find an existing home in a better location. For example, if you want to be near downtown, that’s where homes were originally built. So, a used home might be in a better location than a newer home.

Finally, something that’s personally important to me is landscaping. New homes probably won’t have as much mature landscaping as used ones. That gives them less curb appeal.

In summary, new homes cost more to buy, but less to maintain. They might not have as good of a location, or have as much mature landscaping. Which is right for you? Well, that’s going to depend on who you are. Obviously, if you can’t maintain things or you don’t feel like fixing things up, then a new home might be better — but you may not be able to afford as much home. If location and landscaping are important, used might be better.

Another thing you might consider is buying a pre-owned home that’s been completely redone. Just make sure the remodel was both thorough and properly executed, something a knowledgeable home inspector can help with.

Hope that answers your question, Jill. And now it’s time for our quote of the day. It comes from Napoleon Hill.

“The man who does more than he is paid for will soon be paid for more than he does.”

A nice thought to carry with you today. Make it a profitable one and meet me right here next time!

Got a question you’d like answered?

You can ask a question simply by hitting “reply” to our email newsletter, just as you would any email in your inbox. If you’re not subscribed, fix that right now by clicking here. It’s free, only takes a few seconds, and will get you valuable information every day!

The questions I’m likeliest to answer are those that will interest other readers. In other words, don’t ask for super-specific advice that applies only to you. And if I don’t get to your question, promise not to hate me. I do my best, but I get a lot more questions than I have time to answer.

About me

I founded Money Talks News in 1991. I’m a CPA, and have also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate.

Got any words of wisdom you can offer on today’s question? Share your knowledge and experiences on our Facebook page. And if you find this information useful, please share it!

Got more money questions? Browse lots more Ask Stacy answers here.

How to find cheaper car insurance in minutes

Getting a better deal on car insurance doesn't have to be hard. You can have The Zebra, an insurance comparison site compare quotes in just a few minutes and find you the best rates. Consumers save an average of $368 per year, according to the site, so if you're ready to secure your new rate, get started now.

Read Next
7 Secret Departments of Amazon You Should Know About
7 Secret Departments of Amazon You Should Know About

These little-known sections of Amazon are hidden gems for deal-seekers and impulse shoppers alike.

How to Stop Living Paycheck to Paycheck in 8 Steps
How to Stop Living Paycheck to Paycheck in 8 Steps

Does it feel like your paycheck is gone the moment you get it? You can break that vicious cycle.

Secret Ways to Save on Netflix
Secret Ways to Save on Netflix

These little-known savings tactics can help whittle down what you pay for your streaming video subscription — every month.

28 Things You Should Never Pay For — and How to Get Them for Free
28 Things You Should Never Pay For — and How to Get Them for Free

From entertainment to education, if you know the tricks, you can save big.

7 Things I Never Buy at Costco
7 Things I Never Buy at Costco

A bulk buy isn’t always the best buy. Here’s where I shop for these items instead of a warehouse club.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
Will I Get My Ex-Husband’s Social Security When He Dies?
Will I Get My Ex-Husband’s Social Security When He Dies?

Two factors determine how much money is coming to you.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

21 Things You Should Always Buy at a Dollar Store
21 Things You Should Always Buy at a Dollar Store

Dollar stores have great bargains on these familiar purchases. Yes, even pregnancy tests.

13 Brilliant Bulk-Buy Items on Amazon
13 Brilliant Bulk-Buy Items on Amazon

Every household should have these products on hand. Buying them in bulk on Amazon saves you cash.

6 Reasons I Will Never Trust Suze Orman
6 Reasons I Will Never Trust Suze Orman

Beware: The self-proclaimed personal finance expert has a track record that suggests more sizzle than steak.

This Type of Social Security Benefit Is Often Overlooked
This Type of Social Security Benefit Is Often Overlooked

The Social Security Administration is not helping certain people get money to which they are entitled, a report says.

Getting These 2 Shots Could Reduce Your Risk of Dementia
Getting These 2 Shots Could Reduce Your Risk of Dementia

These vaccines may lower the risk of Alzheimer’s disease by up to 40%.

8 Deep Discounts Available on Amazon This Friday
8 Deep Discounts Available on Amazon This Friday

These items are all steeply discounted — but the deals won’t last long.

9 Everyday Problems You Can Solve With Vaseline
9 Everyday Problems You Can Solve With Vaseline

Forget expensive specialty products. Good ol’ petroleum jelly can address many common annoyances.

16 Amazon Purchases That We Are Loving Right Now
16 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

19 Purchases That Buyers Almost Always Regret
19 Purchases That Buyers Almost Always Regret

Think twice before buying these things.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

7 Tips for Building an Emergency Stockpile
7 Tips for Building an Emergency Stockpile

A pandemic or natural disaster could leave you reliant on your existing food supply. Is your pantry prepared?

Homeowners Say These 2 Kitchen Appliance Brands Are Best
Homeowners Say These 2 Kitchen Appliance Brands Are Best

One brand takes five of the top honors, while another ranks highest in three categories.

41 Things You Should Never Buy
41 Things You Should Never Buy

Some purchases are just plain dumb. Give yourself — and your budget — a break. Don’t spend money on this stuff.

9 Indestructible Products That Are Worth the Price
9 Indestructible Products That Are Worth the Price

If you’re willing to pay a little more for these products, you may never have to shop for another again.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

8 Ways to Slash Your Internet Bill
8 Ways to Slash Your Internet Bill

No matter what price you are paying for internet service, taking these simple steps can lower it.

Americans Agree on These 3 Changes to Social Security
Americans Agree on These 3 Changes to Social Security

In an era of division, we are united about these changes to the Social Security system.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.