“Depreciates $2000 the minute you drive it off the lot.”  We’ve all heard this justification for buying a used car versus a new one but how well does this relate to housing.  Unlike cars, homes are supposed to appreciate.  It was not until the most recent years that we have seen the opposite, or at least the less than stellar appreciation of years past.  So which does offer a better value, older homes or newer?

Don’t think just about the house but the whole package.  An older home is generally going to be in a more established part of town.  There will be little guessing what the neighboring properties will look like, what local businesses thrive and what people and amenities the area has to offer.  Making a bet or taking a risk on this neighborhood can be done with far more information backing up your decision.

To the contrary, or even the extreme opposite, if you buy a brand new home in a brand new subdivision you have far less information to back up your decision.  How well does the neighbor take care of their lawn?  You may not know for years.  How large will the neighboring homes be?  How long will it take for the developer to fill the subdivision?  Will changes in the market affect these plans?  If you see value in information and an ability to better predict the outcome of your purchase, then an older home may offer more value.  If you see value in crisp finishes, walk in closets, integrated technology and a theater room you may find more value in a newer home.

The most important thing is that you see value and that you feel those values are shared by many.  It is easy to pick a house you want to buy but few people remember they are also choosing the house they will someday have to sell.

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