New construction or renovation, which do you prefer ?

1 Reply

I ran across a property where the land is more valuable than the structure. Come to find out that, although the neighborhood has a ARV average, most homes have foundation issues. Is better to get lots in the neighborhood and do new construction with modern foundation technology and specs?

Depends. Even dollars I'd probably take the new structure as you can rarely renovate everything on an existing property to new standards without spending ridiculous money. 

However, you usually get more bang for your buck on a renovation *because* you are not renovating everything. You're already getting a water tap, foundation, wall framing, etc. Also, some old stuff is better than new and vice versa. Foundations have become much better over time. Old wood framing is usually better wood stock and sturdier than new, fast-growth pine. Old wood floors are far and away superior to today's wood floors. New plumbing is better than old in general, especially if you have galvanized supply or cast-iron waste. New electrical is better than real-old electrical with cloth insulation but not as good as 30-40 year old wiring with thicker copper wire and thicker plastic sheathing, so long as the sheathing isn't brittle. 

In general, most new materials are cheaper made and less likely to have superior longevity than materials from 40+ years ago. But virtually everything made today will last 30 years, and you're unlikely to care beyond that. 

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