Posting #5 Why Should I Build New Versus Buying Used?
Posting #5 Outdated Decorating = More Cash Out of Pocket
In addition to differed maintenance, there is also the issue of differed decorating and updating. How much does new carpet cost, a new kitchen remodel, a new bathroom remodel, add a missing deck, painting, etc? The answer is…a ton. In fact, major remodeling typically cost nearly twice as much per square foot as compared to building new from scratch. Over time, if you remodel the entire house might actually be spending more per square foot than if you just bought new to begin with. Crazy thought isn’t it? Even if the used house just needs new carpet, paint and maybe a mild make over in the kitchen and baths that can add up to 10-20,000 in a heartbeat.
Again, in effort to be fair, I am using a very conservative $10,000.00 for deferred decorating, but this number can easily be much-much-much more. Home Depot, Lowes, Menards sell billions of dollars of merchandise each year. There are thousands and thousands of remodelers making a very good living across America. Those dollars are going somewhere, aren’t they? Of course a new home does not have any deferred decorating. You get the colors you want, the tile you want, the hardwood floors you want, etc. included in the purchase price.
Note: This blog is part of a multiple part series on the justification of building new versus buying used. If you haven’t read the prior postings, it is important to do so to understand the entire rational below.
Description Used New
Mortgage $ 250,000.00 $250,000.00
Utilities Savings Added $ 0.00 $ 28,000.00 (Posting #2)
Deferred Main Added $ 0.00 $ 46,500.00 (Posting #3)
Go Forward Main Added $ 0.00 $ 9,250.00 (Posting #4)
Total $ 250,000.00 $ 333,750.00
Description Used New
Payment @ 5% interest $ 1,342.05 $ 1,791.64
Utilities $ 291.67 $ 141.67 (Posting #2)
Deferred Maintenance $ 250.00 $ 0.00 (Posting #3)
Go Forward Maintenance $ 50.00 $ 0.00 (Posting #4)
Total $ 1,933.72 Mo $ 1,933.31 Mo
Deferred Decorating $ 10,000.00 Once $ 0.00 (Posting #5)