House age might tell you a lot about the prospective houses you're looking at. It doesn't tell the whole story.
New construction homes command higher prices because you're getting a brand new property that's never been lived in. You're also able to pick the finishes you want like appliances, flooring and paint colors. The question then is whether these benefits justify the higher cost?
People have clear preferences about buying new versus used cars. Funny that we refer to existing homes as “older homes” rather than “used homes”, and it makes sense because older cars have a shorter lifetime expectancy while older homes, especially those built before the 1900s, can last for 100s of years when built with quality materials.
House Age: Reasons to Buy New (and Newer) Homes
There are some very good reasons to buy a new or newer home, as shows on HGTV clearly illustrate how features vary depending on house age. Of course you first want to consider location, which is the number one factor affecting your home's value when you buy, and when you sell a house. You also want to consider the cost for utilities and newer homes cost less to heat and air condition because they have more insulation, have doors and windows that are more air tight and use water more efficiently.
Some home features are easier to update in older homes, i.e. you can replace older appliances with more energy efficient ones. Other home features like an open floor plan or a new furnace are more costly so let's look at the top home features you get with today's new (newer) homes:
- Open concept floor plans – provide more usable and visible space by eliminating hallways, and newer homes tend to be larger than those built even 20 years earlier.
- Energy efficient heating and cooling – from better insulation to more energy efficient heating and cooling systems consistent with building codes driving to reduce US energy use.
- More contemporary home features consistent with the house age – including granite counter tops, stainless appliances and modern fireplaces.
House Age: Features Hard to Find in Newer Homes
Home construction is constantly changing to reflect new building codes, and the cost of labor versus ready-to-install materials. Think about some of the beautiful homes in your town with the intricate wood trim that was carved by hand when these houses were built. A home's exterior features reflect the house age, or more accurately the building standards is common use when built.
- Larger yards with sidewalks and more established neighborhoods – are one of the benefits of buying an older home, unless you're willing to live further away from town to get more land.
- More intricate details providing character rarely found in new homes – like custom interior doors, attractive moldings and built-in shelving and drawers before mass produced cabinets were standard.
- More affordable homes – are often found in older neighborhoods, as they have fewer of the new amenities found in new homes.
House Age: How it Affects Your Housing Budget
House age affects the price you pay when buying a house. It makes sense that house prices reflect how up-to-date home features are, as newer features like a new roof and kitchen appliances are worth more because they'll last longer. The charts here (shared by Joe Manausa, a Tallahassee realtor) illustrate home prices based on house age.
What is surprising is how many homeowners don't understand that most home systems need to be replaced around 20 years of age. This means a home built 30 years earlier that already has a new roof, windows, furnace and appliances should be worth more than a 20 year old house where a new homeowner can expect to replace all these home features in the next 5 years.
Where Americans used to move every 5 to 7 years, we gambled that we could defer major replacement items. Now that we're moving less often, averaging 10 to 12 years and longer, it's time to budget 2 to 3% of your home's value each and start replacing home systems before you find yourself in crisis mode with a leaky roof or no air conditioning. Once you know your house age, you can start planning using these articles: