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Is It Cheaper to Buy or Build a House? Compare the Pros and Cons

When you decide it’s time to put down roots, you may wonder: Is it cheaper to buy or build a house? Unless you’re rolling in money, you’ll probably want to weigh the pros and cons of new vs. old construction - and the price you pay upfront is only where these considerations start.

Here we lay out everything you need to know about the BUY vs BUILD debate.

Upfront Cost

If you BUY an existing home: According to the latest figures, the national median cost of buying an existing single-family house is $223,000. For the average 1,500-square-foot home built before the 1960s, that comes to about $148 per square foot. That said, the exact price can vary widely based on where you live.

NOTE: It is important to understand the figures median cost of buying in the Greater Saratoga Region and your marketplace. Follow this link to to see the price per square foot in your area or ask our local Saratoga Real Estate experts for help.

If you BUILD a new home: The latest figures show that buying or building new construction will set you back an average of $289,415. That’s $66,415 more than the cost of an existing home! Still, you’ll get a lot more for your money. For one, new homes are usually more spacious, with a median size of 2,467 square feet - so the cost per square foot, $103, is actually lower than that of existing homes.

Another advantage of building new is you pay for only what you want, whereas an existing home may have features (e.g., a finished basement or hardwood floors) you’ll pay a premium for even if you don’t want them. But if an older house happens to have everything that suits your needs, that’s the more bargain-friendly route.


If you BUY an existing home: Older homes have more wear and tear, which means certain things may require more maintenance.

Naturally, the cost of this upkeep isn’t cheap, so make sure you know the age of the main items. For example, the average furnace is expected to last 20 years and will cost $4,000 to replace. The typical HVAC system lasts 15 years and costs $5,000 and more to replace. Another biggie is the roof: The average shingled roof holds up for about 25 years. If you need to replace it, you’re looking at a bill of at least $5,000.

If you BUILD a new home: Considerably less upkeep is one of the primary benefits of building a new home, because everything from major appliances to the HVAC system is new and under warranty. In fact, sometimes the entire home is protected for up to 10 years because a builder generally offers a new construction warranty “for any problems that arise.”. Your maintenance outlay for a decade is potentially zero dollars.


If you BUY an existing home: A major perk of older homes is mature landscaping with large trees and established plantings. That may not seem like a big deal until you consider that the U.S. Forest Service estimates that strategically placed mature trees can add tens of thousands to a property’s value and save up to 56% on annual air-conditioning costs.

If you BUILD a new home: It may take thousands of dollars - and many years - to get the yard you want. For instance, one 6- to 7-foot-tall red maple will cost about $120 (if you plant it yourself), which will then grow 2 to 3 feet a year. According to HomeAdvisor, the average cost of adding complete landscaping is $3,219.

Energy Efficiency

If you BUY an existing home: The latest U.S. Census found the median age of American houses to be 36 years. Older construction means dated windows and appliances - dollars flying out the window on wasted energy.

If you BUILD a new home: New construction almost always beats older homes in energy efficiency. Homes built after 2000 consume on average 21% less energy for heating than older homes, mainly because of their increased efficiency of heating equipment and building materials. This translates into lower energy bills.


If you BUY an existing home: The nice thing about old homes is that there’s context to your purchase: Your Real Estate Agent can provide information on the home’s previous sale prices, as well as prices of similar homes in the area (known as comparables, or comps) to get a feel for whether prices are rising or falling in your area. If the prices for your home and others in the area have been steadily rising, odds are decent that the trend will continue, which bodes well for you if you decide to sell later on.

If you BUILD a new home: New homes, particularly in up-and-coming neighborhoods, are more of a gamble. Without a proven track record of lots of comps, there just isn’t enough data to really know what could happen down the line. This is also true for all the latest amenities you might request in your home (think all those smart devices, like smart thermostats or NEST cameras).

Some trends die quickly, dating the home, and can negate any appreciation. So when in doubt, try to steer clear of anything that screams it’s a passing fad (self-cleaning toilets perhaps).


Are you searching for a home and trying to decide between buying or new construction? What Pros and Cons do you have to add to our list? We want to hear from you so sound off on our Facebook Page or on our Twitter or Instagram feeds. And don’t forget to subscribe to our monthly HOME ADVICE tm email newsletter for articles like this delivered straight to your inbox.

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​Shannon McCarthy

Licensed Real Estate Salesperson

Keller Williams
125 High Rock Ave, Suite 200
Saratoga Springs, NY 12866


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