With everything going on in our world today, the lingering question for families around finding a home is, will it be more affordable to buy or build a new home in the Western Wisconsin area? Naturally, there are pros and cons to each. To answer this question, we will need to consider your medium and long-term needs and goals. We will also need to look into real estate trends in the area. Let's get started.
Is it Better to Build or Buy a House in Western Wisconsin?
The housing market in your area is still strong, especially along the waterfront with its many historical and cultural landmarks. The median price of a new home in the area for the first half of 2021 is about $375,000. That's up by 14.1% from 2020, and more than 38,500 homes have been sold in Wisconsin in the first half of this year. That places houses sold on an 8% uptick over the recent year. It’s safe to say people are buying and this is a hot market for sellers.
The Western part of the state in particular has seen a large increase in the number of sales from January to July with June reaching an all-time high thus far. July shows a slight decrease both in the number of home sales and the price, but what will happen the rest of the year is still a bit unclear.
The Cost to Build New Homes in Wisconsin
There are multiple factors contributing to the cost of building a new home. These are listed below. Prices are based on national averages as tabulated by the National Association of Home Builders.
- The shell of the structure: $95K
- Interior finishes: $85K
- Plumbing & heating: $35K
- Kitchens & bathrooms: $16K
- Architect & engineer drawings: $4.5K
- Land: $3K per acre
- Excavation: $33K
- Building permit: $1K per year
- Inspections: $5K
Adding up these averages, we find ourselves at a grand total of $277.5K to build a home in the continental United States. Bear in mind these are national averages and do not represent Western Wisconsin trends exactly. Looking at the averages of a number of Western Wisconsin builders we find the average price in this area to be a bit higher as it is somewhere between $500,000 and $1M.
So we can say that you may pay less by selecting a low-end piece of real estate, as it will cost more in the short term on average to build a new home than to buy an existing home. This should not be surprising, as the advantages of building a new home are significant. However, over time, building a new home can be much more affordable. We'll explain.
The Pros & Cons of Build Versus Buy in New Richmond
For a start, we can say with confidence that a new home, made with modern materials and build methods, will be sturdier, more airtight, more structurally sound, and energy-efficient than any existing home. What's more, mold, radon, and other similar serious problems can be hiding deep in the structure and foundation of any existing home. The cost of stripping out spaces in search of hidden mold can be enormous. With a new structure, these problems are non-existent.
The costs of problems like these can be enormous, especially in older homes. The average cost of mold removal and mitigation, when the blooms are advanced and hidden deep within the structures of a home, is around $6,000. It can be much more than that if the problem is extensive. Buying older homes also comes with significant upkeep costs. When aging homes are sold, real estate professionals usually do a good job making the structure look better cared for than it really is. But paint and plaster are superficial and can hide many deep-seated problems. What's more, if there are any significant problems within the first year, you are unlikely to get much support from the seller.
One common fix older buildings will need is to have their electrical system updated. Many modern appliances are rather power-hungry, and few people today are willing to accept a single power outlet in each room, which is a common feature of older structures.
The Advantages of Building a Custom Designed Home
If you're one of the many people looking to move to a family-friendly area, you may already have experience with owning and maintaining a home. And you will have a better idea of what works for you and your family and what doesn't.
When you build a new custom home, you get to choose the floor plan, features, and size. Do you want one story or more? Would you like to choose the placement of your living room, den, or bedroom and place that large bay window you've been dreaming about for a stunning view of the river? Could a twin home better suit your needs? These are the kinds of things most people assume are beyond their control. But with a custom build, they are within your reach. With a custom home, you can choose from among the latest styles and material trends. Build out a kitchen/entertainment area to make the most out of visits from family and friends. A custom home is all about suiting your lifestyle, your values, and your unique needs perfectly. No pre-existing structure can do that.
Finally, new homes make smart use of advanced materials that can resist radon permeation, the growth of mold, and that will last longer than outdated materials and build techniques. You'll save money on your utility bills with a fully sealed, temperature-controlled building using energy-efficient HVAC equipment and rock-solid polyvinyl framed windows.
Certainly, you can save money in the short term on an older home. This can be a good choice, especially if you're a DIY aficionado willing to spend the time and money repairing old-house problems. But over time, a new custom home will suit your needs better, give you fewer headaches, and save you tens of thousands over the years with an advanced energy efficiency profile.
With the housing market the way it is, building a new home with all the amenities and long-term savings in costs and convenience might be that deciding factor you’re looking for. As you consider your particular family circumstances and what you are looking for, read more about how to purchase a new home, and reach out to our experts at Derrick Custom Homes to help guide you through the process of what building a new home would mean for your specific situation. Give us a call today!