What can I say…I’m a new homes guy. I grew up in the business and have been involved with new construction for 33 years, so I guess I’m partial to “brand spanking new homes”. Re-sales and new homes have always battled each other. Now there are two more competitors that have entered the ring and are getting much attention. They are short sales and foreclosures.

So how do you decide which is the best VALUE for you? The old adage that the cheapest price isn’t always the best deal holds true here. So, let’s take a look at your options.

We’ll begin with the short sale which is usually a distressed property that the owner can no longer make the payments on. As a result, owners negotiate with the bank to let them pay off the loan at an amount lower than that of their mortgage. What is unfortunate is that, oftentimes, these owners cannot afford the negotiated monthly payment which means that they cannot afford to properly maintain the property. The result is disrepair. It may seem like you are getting a “deal” but after all the repairs are made…is it really? In addition most short sales are sold “as is” with no warranties, which means you have no remedy if there is a major problem with the home! To say however, that there are never warranties would be incorrect. Just be sure to specifically ask if the home comes with one.

The average short sale can take 3-6 months to close, but often times you may navigate all the hurdles and get to what you think is the finish line only to find that the seller cannot or will not be able to sell you the property. If you are going to consider buying a short sale enlist the services of a Realtor that has successfully closed short sales.

Foreclosures are in the same category as a short sale. The only difference is that instead of being owned by an individual they are owned by a lending institution. Foreclosures also tend to be in worse shape than a short sale because the time to foreclose on a property is typically drawn out. During that time owners know they are losing the property so often do nothing to maintain it and sometimes remove fixtures and appliances.

So why buy new?

The most compelling reason is that you do not have to worry about the condition of the property! All mechanical systems and appliances in working order, energy efficient designs ensure lower energy costs and, most importantly, you will have peace of mind that there are numerous warranties offered from the manufacturer and builder.

Most builders today put extended warranties on their homes that range in coverage from complete coverage in year one, mechanical, plumbing and foundation problems for year two and foundation problems only for the last eight years. In the case where a builder offers no formal warranty, North and South Carolina requires builders to warrant the house for workmanship and habitability for 6 and 8 years respectively.

There are many more reasons to purchase new… selecting a neighborhood in the location you want and with the amenities that fit your lifestyle, choosing a builder that can deliver a quality home, the ability to customize your home with the features, style and color selections that reflect your tastes, taking advantage of promotional features that today’s builders are offering such as free options, interest buy downs and closing costs assistance. But above all

else, it’s the peace of mind of knowing that “it’s a brand new spanking home”!

Happy House Hunting!

- Mike LaRuffa