When buyers are in the market for a newly built home, they often encounter significant price differences compared to existing homes. According to the U.S. Census Bureau and the Department of Housing and Urban Development, the median sale price for new construction in the U.S. was $400,500 in February. The cost of a newly built house can vary depending on the finishes and customizations added by the buyer. This includes factors such as windows, flooring, siding, window panels, doors, outlets, and light switches.
In order to reduce costs when purchasing a newly built home, it may be beneficial for buyers to consider hiring a contractor separately to add desired finishes at a later date. Angie Hicks, a home expert and co-founder of Angi, recommends focusing on elements that can be easily added or changed in the future. By deferring certain finishes or upgrades for later renovation projects, buyers can keep the overall price of the new build within a more manageable range.
According to the State of Home Spending by Angi, homeowners spent an average of $13,667 across 11.1 projects in 2023. Many homeowners used a combination of savings, credit cards, refinancing, or home equity lines of credit to cover the cost of renovations. By being conservative in their initial selections, buyers can always update or replace features in the future through hired contractors. Experts suggest focusing on the structural components of the home, such as kitchen and bathroom remodels, where costs can range from $6,629 to $41,440 depending on materials, labor, and location.
When building or purchasing a new home with the intention of upgrading features later on, it is recommended to opt for basic or lower-priced finishes initially. By avoiding expensive customizations upfront, buyers can save money and allocate resources towards future renovations. According to Hicks, there is no need to fully complete the interior design of the house during the initial construction phase. It is more cost-effective to invest in structural elements and make cosmetic enhancements later through renovation projects.