Many of my buyers are opting for lower operating costs, no HOA fees and high efficiency appliances in a home with more modern floorplans. New homes, in many cases, offer more convenient floorplans, larger storage spaces, modern building codes and standards and lower operating costs. However, there will usually be an HOA in many of the newer neighborhoods due more shared common areas.
I recently found some interesting and important reporting on operating costs and thought it was something to keep in mind when home shopping. According to the National Association of Home Builders, (NAHB), home maintenance, utility, property tax and insurance costs vary based on the age of a house. NAHB's research found homes built before 1960 have average maintenance costs of $564 per year compared to a home built after 2008 which averages only $241. Or, overall operating costs average almost 5 percent of the home's value for pre-1960 structures, while they average only 3 percent for homes built after 2008.
NAHB's study then compared the first year of owning a home for after tax costs, using the purchase price, mortgage payments, annual operating costs and income savings. On average, a buyer can afford to pay 23 percent more for a new home than one built prior to 1960. So, even though the mortgage payments will be more for a new home, the operating costs can usually offset that expense.
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