Home Buying in New Orleans>Question Details

Monique, Home Buyer in New Orleans, LA

Do you think a first time home buyer should start off with building a home or just buying a built home first?

Asked by Monique, New Orleans, LA Fri Feb 20, 2009

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Home buyers, especially if it's their first time, should generally buy existing homes, rather than building from scratch. In addition to the excellent points made below, there are financing considerations as well. Construction loans are more expensive and more difficult to qualify for, compared to regular mortgages. That's more true than ever nowadays. As lenders, we're all sensitive to the glut of inventory. We'd prefer to help absorb the existing housing stock, not add to it. If you really want to customize the home you buy, you can finance the purchase with a rehab loan that allows you to include the estimated renovation costs in your purchase mortgage. Feel free to contact me to discuss the options: James Wheeler, 813-600-3428.
1 vote Thank Flag Link Sat Feb 21, 2009
Building is going to be much more expensive right now. Construction costs went sky high in our area after Katrina with the shortage of building materials. There are a lot of brand new homes sitting on the market because,especially in the suburban areas,builders anticipated a boom in new . construction and overbuilt.
these guys are hurting right now and as Ian pointed our,there are some real deals out there both in new construction and with houses that are 100% renovated so they are better than new.
1 vote Thank Flag Link Sat Feb 21, 2009
Monique, I read your blog and appreciated your sharing your experience with the forum.

If you decide to go with an already built home, I thought you might like to consider checking this site out.
http://www.mortgagenewsdaily.com/wiki/REO_Database_List.asp

The Banks maintain databases of the properties for sale (REO) and who they list them with. These databases contain description of property, sometimes photos, asking price, address, and listing agent contact info.
Many banks make these databases Free for the public to use....Like these
http://www.countrywide.com/purchase/f_reo.asp
http://mortgage.chase.com/pages/other/co_properties_landing.jsp
The site will also give you the links to Gov. properties for sale
http://www.hud.gov/homes/index.cfm
http://www.homesales.gov/homesales/mainAction.do

It gives a person a chance to view at home properties and asking prices henever they feel like it and it's free.

As for the question you asked, IMHO shop and compare prices for doing both. Decide if you are really going to get that much more of a home having it built vs existing for the money you spend.

I wish you the best of luck with your decision and new home, Dunes
1 vote Thank Flag Link Fri Feb 20, 2009
Buy a home already built...first time home buyers generally do not have the experience nor understand the long process to build a home...especially in the new Orleans area.

There are so many homes that have been 100% renovated, or going for 30% off it makes way more sense to get one of these.

Email me some details on what and where you are considering.

...but first go to my website and look at the options / costs to build in our area.
Web Reference: http://www.iansellsnola.com
1 vote Thank Flag Link Fri Feb 20, 2009
Bill and David--you are both right. Sometimes renovations are merely cosmetic. We bought this ugly, raised cottage in the Garden District for under 100K. Structurally it was sound and all it needed was some paint and cosmetic details, a new porch--around 20K. So, I would encourage Monique to think about a renovation loan because you can greatly increase the value of your home while detailing it to your desires. However, you absolutely have to consider your needs and future needs in terms of space and affordability.
0 votes Thank Flag Link Fri Mar 6, 2009
David,

We believe a first time home buyer shoulf be focusing on affordability, growing family needs, and quality of life as their primary concern. The new home vr. resale issue should be secondary.
0 votes Thank Flag Link Thu Mar 5, 2009
I have a slightly different approach to this question. I am a renovation lending specialist and have helped a number of families purchase their first home and renovate it to their liking. This method may net you a larger gain on your investment over the years if you can strike the right deal going in on a home needing renovation. It is much easier than building a home from scratch but it is still an undertaking that requires more time than buying an existing ready to move into home.

My clients over the years have found the experience rewarding and profitable. This is an option to consider.
Web Reference: http://www.203k-loans.com
0 votes Thank Flag Link Thu Mar 5, 2009
Monique--

KB Homes are currently building new, gorgeous, architecturally appropriate homes that are termite proof, on the highest elevation in the city, with hurricane trussed roofs and planned green spaces, in the Lower Garden District, in the vicinity of the new Walmart next to the river. These homes are stunning and if you can qualify, go for it. Another alternative would be a newly renovated condo.
0 votes Thank Flag Link Sun Mar 1, 2009
Monique,

This is an EXCELLENT question..........

At the current time, it is our personal opinion, that the best opportunities for buyers exists in the area of resales. Homes are being sold daily that represent enormous savings that could not be duplicated by today's builders.

Many of these opportunities ARE brand new, never lived in homes. Some of these homes are $200-$300 thousand dollar homes that are being sold at or below the $100,000 range.

Our recommendation is to remain conservative and explore the options that exist in the resale market before deciding to build.

Good luck
0 votes Thank Flag Link Sat Feb 21, 2009
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