Buy or Build a New House?

Have you tried to decide between buying a new house or having one built? If you invest the time and money in building a new house you will want to have some confidence that spending the money to build it will create value which can be sold.

I’ve looked at homes which sold with a listed age of 0 years, then found the previous sale. I’ve plotted the increase in sales price per square foot. For Palo Alto most of the newly built homes have been showing increases of over $400 per square foot since the beginning of 2011. If you can build your new home for around $300 per square foot, you stand an excellent chance of having your home worth more than it cost you to build it.

However if you look at Sunnyvale the story is quite different. Very few records were found. Those that were found all show increases of less than $350 per square foot.

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