Why Buy New: Lower Maintenance and Operation Costs

Updated on October 17, 2024: This story was originally published on March 31, 2016, and has been updated with new information.

Moving into your new home in Florida should leave you thinking about home decor and housewarming parties, not plumbing repairs! When considering the value of buying a new home or a used home, your considerations should include not only the initial cost but also the ongoing costs of operating and maintaining your home.

According to Census data analyzed by the National Association of Home Builders (NAHB) a newer home costs less to operate than an older home thanks to energy-efficient technology, modern building practices, and limited (or no) wear and tear. Add in the fact that a new construction home will not require the costly renovations needed to personalize and update an older home, and you can start to see how a new home can provide long-term savings. 

Keeping your homeownership costs low means more of your hard-earned money can go towards fun things rather than bills. Let's break down some of the costs you can expect as a homeowner.

Initial Cost

In the past, existing homes were attractive to budget-conscious buyers because of their low listing prices compared to new construction homes. Today, the gap is narrowing and new construction homes are priced within 10% of the median sales prices for used homes.

In addition, many homebuilders in Florida offer incentives such as paying all or a portion of closing costs or buying down your mortgage interest rate, which can eliminate the price gap entirely and in some cases make the monthly mortgage payment for a new construction home lower than that for a lower-priced used home.

Operating Costs

In general, the older the home, the more money you’re going to spend on operating costs. The operating costs of homeownership include:

• Real estate property taxes
• Homeowners Insurance
• Utilities
• Maintenance and repairs

To put this in numbers, according to data analyzed by the National Association of Homebuilders (NAHB), a home built before 1960 costs more than twice as much to operate than a newer home (built after 2010). Here's why.

Real Estate Property Taxes

This one doesn't vary much between newer and older homes. In Florida, property taxes are calculated based on a millage rate (think of this as a tax rate) and the taxable value of your property. The millage rate can change annually and affects all real estate in the tax district - there is no advantage between new and used homes.

Homeowners Insurance

Insurance for new construction homes is generally more affordable than used homes - In fact, it may cost up to 30% less to insure a new home.

Why? New builds have a lower risk of claimable damage. They are built with modern materials. They are built to meet or exceed building codes. They may have tech, safety, and green home features that can reduce your premiums. They have a brand-new roof, which is a pricing factor that can impact premiums.

Older homes are judged more likely to generate losses due to roofing, wiring, and plumbing issues. In addition, claim costs could be higher due to requirements to repair to modern building codes.

Utilities

Here in Florida, our balmy summers mean keeping a house cool and comfortable can impact your utility bill. The NAHB study found that newer homes cost half as much for fuels (electricity, gas, oil, or other fuel) than homes built before 1960. Even if you are not looking at a home that old, the study found newer homes are about 35% cheaper for your electric and gas utilities than homes built between 1980 and 2009.

Utility costs also include water/sewer and trash services - and these are cheaper for newer homes, too.

Why? New construction homes are built to meet higher efficiency standards. They have more insulation, and more efficient appliances, plumbing fixtures, and HVAC equipment. They are constructed with a tighter building envelope, meaning they have less air leakage and your HVAC equipment can operate more efficiently. 

Plumbing fixtures in new homes are designed to use less water, and new plumbing is less likely to have leaks which can increase water costs. As far as trash services, those are often included either in your property taxes or HOA; sometimes homeowners in older neighborhoods without an HOA must pay for their trash service separately.

As a company that not only builds new homes in Florida but is based here, as well, Highland Homes understands the value of building with products designed to lower your utility costs and energy consumption - Learn more about the energy-efficient features included in our new construction homes in Florida. 

Maintenance and Repairs

Buying new will always win the battle in an ongoing maintenance cost comparison. With a new construction home, your home maintenance is comprised of basic tasks like changing batteries in your smoke detectors, re-caulking, and replacing a/c filters. With a used home, you must consider possible costs to replace an old water heater, rewire faulty electricity, buy new appliances, fix a plumbing leak, re-paint, or even replace your roof. 

Take into consideration the estimated costs in 2024 for these common home repairs, according to Home Advisor.

Problems with major home systems can unexpectedly add to your bills - and your stress. And, these repair and replacement costs do not even account for renovations you'll likely want to update an older home and make it better suited to your modern lifestyle.

Compare this to buying a new home that already includes brand-new wiring, paint, plumbing, appliances, shingles, fixtures, and finishes (selected by you and not previous owners, nonetheless), and there is no contest as to which option will save you money and keep you from being stressed about unexpected repairs.

Save Money by Buying a New Construction Home

Rather than plan to spend future time and money on renovating and repairing a used-up home, why not take that same money and invest in a wiser choice? All costs considered, buying new is the most affordable option for many home buyers.

In addition to money savings, new homes are built with the features you are looking for such as open layouts, flexible-use rooms, high-performance kitchens, built-in storage and organization space, garages, and outdoor living areas. When you choose a personalized new build with Highland Homes, your home is truly designed by you and built for you. You choose everything from your home plan and home site to paint colors, fixtures, and finishes throughout your home. As the icing on the cake, our new homes in Florida include valuable warranty protection - How’s that for peace of mind?!

To take advantage of the benefits of buying new and find your new home designed for your life, call or email our Florida New Home Specialists today.