New development vs. Currently Built

[Chandler Buckner]

Hi BP,

Hope everyone is doing well.

I'm pretty green in the real estate world here in Albuquerque, New Mexico, but I'm very excited about real estate, and have recently been hungrily seeking out as much information and different perspectives as I possibly can. I know that I want to house-hack, but I need a set plan first.

My question is this: WHAT ARE THE PROS AND CONS OF DEVELOPING NEW PROPERTY VS BUYING  AN EXISTING PROPERTY WHEN STARTING???

I've talked with a few different colleagues of mine who already own and rent out properties here in town (contractors, builders, mortgage brokers, etc.) and it seems as though they have all given me the same answer-- buy something pre-existing. Hearing this, I feel sold. 

But I would still like to know exactly why buying pre-existing is better than building new.  Any and all insight is greatly appreciated. 

Thanks so much everyone!

[Bob Okenwa]

@Chandler Buckner

Do you or anyone close to you who can advise you have experience with property development? That is a whole different ball of wax and takes a lot more money and time to get off the ground for a new investor. Sounds a little steep and very complex to try to start building houses brand new. I'd listen to the advice you've been given and stick with pre-existing properties as the work to fix them is less when compared to all of the permits and plans you have to get together to develop new property. Permits and architectural drawings are not free and not cheap. I live a new construction community and bought my house new and it took 5.5 months to build and that's with pre-approved plans and zoning and existing infrastructure. Took 1 month to get the permits approved by the city before they even broke ground before taking the 5.5 months to build. There are a ton of components that go into building a new home. Make sure you're fully aware of how labor and detail-intensive it can be before deciding if that is what you want to do.