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Buying Land and New Construction >Buying New or Buying Old
New homes typically have a higher sales price than comparable existing homes, and buyers are usually willing to spend more on a new home because of lower maintenance costs. Builders' warranties on new homes, when combined with a new roof, appliances, and major systems, usually make major repairs unnecessary and help to counter a slower initial rate of appreciation.
Census Bureau Housing Surveys suggests that operating costs are lowest for brand new homes and slightly higher for relatively new existing homes. Operating costs per square foot of living space are consistently higher for progressively older existing homes. Utility costs represent the largest factor in operating costs. Energy consumption per square foot depends on the size of the home, the insulation and quality of the windows, air leakage and the efficiency of the furnace.
New homes require fewer expenditures for routine maintenance. The cost of maintenance first increases with age, then declines, so you will generally spend less maintaining a home built before 1960 than for a home built between 1970 and 1975.
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| Q |
What high-profile rental property rents for $13,500 a month although the star hasn't lived there for over 20 years?
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| A |
Shirley MacLaine's name is still used to promote her Encino, CA, estate even though she hasn't lived there in years.
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