Should You Buy or Build Your Dream Home?

The choice between buying and building a house hasn’t become much easier in 2024. While expert predictions that the housing market would cool off this year have mostly borne out, that’s due in large part to high costs and interest rates turning off prospective buyers. On the other hand, builders are facing construction costs that have surpassed the rate of inflation. According to Forbes, the average cost to build a new house is around $329,000 — not including the cost of land.  

 

We can help you run some numbers on the money part. But a lot more than money goes into a true “dream home,” especially if you’re thinking about living there through retirement. Discussing these three questions with your family can clarify what home really means to you and how the journey to your next home could impact your Return on Life.  

 

1. What are our non-negotiables?

 

No one really needs a swimming pool in their backyard. But the amount of time and money that you’re going to invest in a new home should yield a comparable ROL. Comfort, recreation, and convenience are all important parts of that equation. You might find an existing home that checks almost all of your boxes. But if there really isn’t as much closet space as you want, or if you really wish that half-bathroom downstairs had a shower, that dissatisfaction is only going to linger and, potentially, lead to more spending on upgrades.  

 

If you’re willing to deal with the hassles of building a new house (see below), the trade-off is you might be able to design your dream house from floor to ceiling. Instead of working part time at the kitchen table, you can build a home office. If you’re planning to grow your family, you can build an extra bedroom or two. And if a house just wouldn’t feel like home without somewhere to splash, float, and swim, you can sketch in room for that pool as well. 

 

2. How much hassle can we afford?

 

In general, moving into an existing home is going to be easier and faster. There will still be several complex steps to the process, especially if you’re trying to sell your current home at the same time. But a good real estate agent or realtor will help you keep track of what needs to get done. 

 

You may also need to work with a real estate agent and a lender to purchase land to build a new house. On top of that, working with an architect and contractor could feel like taking on a second job. You may not be the one designing the house or pouring the concrete, but you will have to make countless decisions about every aspect of the house and sign off on countless details. That might be too much for a busy family to handle.   

 

3. Where does our dream home fit on our family’s $Lifeline?

 

The timing of your move is no less important than the time you’re investing in your next home. If you only have a couple years left before your teens head off to college, you might not want to spend much of that precious time together waiting for a new house to be built. On the other hand, if your current home meets the majority of your needs, you might be willing to live with a few quirks and imperfections as you build up your savings and refine your designs.  

 

Reviewing your $Lifeline can help you weigh these kinds of tradeoffs while also being mindful of other upcoming transitions and goals. Let’s meet and discuss the ROL you’re receiving from your current home and the boost you’re aiming to get by making your dream home a reality.  

 

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