Buying a newly constructed home can be an exciting yet financially daunting experience. The median sale price for new construction in the U.S. was $400,500 in February, according to the U.S. Census Bureau and the Department of Housing and Urban Development. However, the final cost of a newly built house is influenced by various factors, including the finishes and customizations chosen by the buyer.
Certified financial planner, Veronica Fuentes, emphasizes the importance of careful consideration when selecting finishes for a new construction. These finishes can include windows, flooring, siding, doors, outlets, and light switches. The more upgrades and customizations a buyer chooses, the higher the final price tag of the home. In order to save on costs, it may be beneficial for buyers to opt for basic finishes during the initial construction phase and then hire a contractor later on to add desired upgrades.
Focus on Future Renovations
Home expert, Angie Hicks, recommends focusing on elements that can easily be added or upgraded at a later date. By deferring certain finishes and upgrades for future renovations, buyers can keep the initial cost of the newly built home within a manageable range. According to the State of Home Spending report by Angi, homeowners spent an average of $13,667 on 11.1 projects in 2023, with nearly half using cash from savings to cover renovation expenses.
When it comes to financing home renovations, it is essential to be conservative with budgeting. Fuentes advises clients to prioritize structural elements over cosmetic finishes, as these can be easily changed or upgraded later on. While the cost of remodeling projects can vary based on materials and labor, kitchen renovations in 2024 ranged from $14,611 to $41,440, while bathroom remodels ranged from $6,629 to $17,536. By opting for basic or lower-priced features initially, buyers can save money and allocate funds towards future upgrades.
Strategic planning and financial foresight are essential when purchasing a newly constructed home. By carefully selecting finishes, deferring certain upgrades for future renovations, and focusing on structural elements, buyers can minimize costs and make the most of their investment. With the guidance of experts like Veronica Fuentes and Angie Hicks, buyers can make informed decisions that align with their budget and long-term renovation goals.
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