Should You Buy a Used or New Home?

Once you make the decision to buy a home, you immediately have a second one to make. Should you buy a used or new one? There are pros and cons for both.

Most people automatically think new is better than used. It is in many cases. With real estate, however, there are a bevy of factors that make the determination a bit more complex.

The pros of a new home include the fact that, well, everything is new. The home is also designed to most modern criteria including energy saving appliances, compliance with all safety regulations and so on. Do to the fact it is new, such a home should be easier and cheaper to maintain as well. All this being said, there are some downsides as well.

How could there be downsides with a new home? Well, let's look at them. First, you rarely are buying a complete home experience. While the home is in perfect shape, many developments now require you to do the landscaping or pay an additional fee to have the developer do it. Another downside is the price tends to be more fixed. A developer simply doesn't have a lot of room to move on price. As a new property, this price will often be much higher than homes in the area that are only a couple of years old.

So, what about used homes? As you might guess, there are pros and cons as well. Let's consider the positives first. Price is a big one. You are going to pay less than for a new home. Style is also a big issue as you may be unable to find the style of home you like in newer developments that tend to go in trendy directions. Another positive with a used home is you can accurately predict the neighborhood. With new developments, one is not always sure how things will develop with so many people moving into the area. Finally, used homes tend to be complete, to wit, you just move in. Although you will probably want to updates, there is no absolute need to.

On the downside, a used home is going to be costlier to maintain since it has wear and tear. Along this line of thought, the home is also going to be less energy efficient. Finally, the very nature of the home may be obsolete. As new gadgets come on the market, your used home may be unable to handle the wiring or have the appropriate space for them. Basic issues like piping may need to be changed and so on.

So, which should you purchase? There is no correct answer. Your goal should be to find something you like and can afford. Then weigh the tradeoffs of new versus old and make a decision.

Manufactured Home Mortgage Loans

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Many potential home buyers find the price is right on a manufactured home and a record number of 10,783 Californians purchased them last year. This is no surprise when the prices can be as low as $129,000 for a new 2,600 square foot home. Another attraction is the increased customization available on manufactured homes.

Buyers can get wood burning fireplaces, stucco exteriors, even attached garages, making manufactured homes look more like a standard home. The price and extras may be right, but getting manufactured home financing can be a difficult endeavor.

Peter Skillern executive director of the Community Reinvestment Association of North Carolina notes, “[Lending] companies used to underwrite anyone who could make an X on the line… [It] came back to bite them.� Green Tree Financial, one of the nation’s largest lenders for manufactured home mortgages found that 30 year mortgages were a huge liability, mostly outlasting the homes and encouraging defaults on the loans.

There were so many defaults in fact, that Green Tree filed for bankruptcy in 2002. Many lenders now will not even consider this kind of loan and potential borrowers are having difficulty financing manufactured homes.

It may take more work and effort to get a manufactured home loan these days, but be sure to take your time to find the right manufactured home lender. Wes Johnson author of “The Manufactured Home Buyer’s Handbook� states that buyers, “should be extremely wary of predatory lending practices.� Compared with a traditional mortgage, consumers should expect to pay larger down payments, higher interest rates and generally a shorter repayment period.

This doesn’t mean that the loan should have ridiculous interest and payments, however. Potential borrowers should shop around and also keep in mind that it can more difficult to refinance a manufactured home mortgage than a traditional one. Manufactured homes without land are not likely build equity quickly, which makes refinancing unlikely.

This also means that borrowers will have an easier time getting the first mortgage if land is part of the purchase price of the manufactured home. The value is more likely to appreciate on a manufactured home that is bundled with land. So if you think that a manufactured house might be the home of your dreams, do your research so that you can make the best decisions about financing.

Becky is a respected writer who recommends the following online resources at . Please visit these additional resource websites:
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Hotel Zoso owners file for bankruptcy

Hotel Zoso in downtown Palm Springs is facing some financial troubles. It's owners have filed for bankruptcy.

This nearly a year after a Las Vegas-based private equity firm with financial interests in the hotel filed for bankruptcy in Nevada.

The hotel's owners says the filing is a standard business practice to restructure their debt.

There are no plans for any lay-offs or changes in the hotel's day-to-day operations.

Chase Says It Will Move if City Balks

is threatening to move thousands of employees from Midtown to Stamford, Conn., if New York officials do not give it a larger subsidy package to build a 50-story skyscraper near ground zero, according to real estate executives and government officials involved in the talks.

Officials view the bank’s threat to relocate outside Manhattan as the latest move in what has become a routine game of corporate poker in which companies try to extract special benefits. But Chase has gotten in touch with at least one large property owner in downtown Stamford, although it remains unclear whether the bank is serious or bluffing.

Chase struck a tentative deal with the Port Authority in late March to pay about $300 million for the development rights at the site of the soon-to-be-demolished building, at Greenwich and Cedar Streets. Chase planned to build a 1.3-million-square-foot tower there and move thousands of employees from Park Avenue to Lower Manhattan, in what was widely regarded as a boon for the beleaguered district.

Officials expected that the move would solidify Lower Manhattan’s place as a world financial center and validate the redevelopment of the World Trade Center site as a commercial complex.

In subsequent negotiations, state and city officials offered the bank the kind of benefit package available to any company moving to ground zero: a combination of tax breaks, cash payments and subsidized electricity benefits worth more than $100 million. But Chase has continually pushed city and state officials for a batch of subsidies akin to what got in 2005 to build a headquarters in Battery Park City. Critics described that deal as an egregious example of corporate welfare.

State and city officials have resisted the bank’s demands. They regard the Goldman deal as an aberration. And Mayor has said that the city will not grant any special benefits beyond what any other company would get.

“We would hope that Chase recognizes that Lower Manhattan is the financial capital of the world and that they would want to be located here,” said John Gallagher, a spokesman for Mayor Bloomberg. “Because the market in Lower Manhattan is strong and because Chase will realize more than $100 million with the incentives in place for Lower Manhattan, giving them an additional incentive package at this point would be difficult to justify.”

Joseph Evangelisti, a spokesman for Chase, declined to comment. Last week, Chase reported a 55 percent rise in first-quarter profits.

Stamford has been a relatively sleepy rival for Manhattan corporations compared with Jersey City, where U.S. Trust, Goldman Sachs, Chase, UBS and other financial institutions have moved at least part of their operations. Until recently, only UBS and some hedge funds had major operations in Stamford. But now the Royal Bank of Scotland is building a $400 million office complex there for what will be its North American headquarters. The complex includes a 95,000-square-foot trading floor and room for up to 1,400 traders.

State and city officials in New York continue to express optimism that a deal can be struck downtown for Chase. One official, who insisted on anonymity because he was not authorized to talk about Chase, said that the snag centered on sales-tax breaks on building materials for the tower, while another said it had to do with payments the bank would be required to make in lieu of taxes.

Office rents are considerably cheaper downtown than uptown, but holding the line on subsidies has still been difficult since the 2005 Goldman Sachs deal. Goldman negotiated with state and city officials to build a headquarters in Battery Park City, a significant financial investment and the first dramatic boost for Lower Manhattan after the terrorist attack on the World Trade Center.

But after a series of missteps by aides to Gov. , the state was forced to grant an unusually large subsidy package to ensure that Goldman would build the tower.

Goldman Sachs got incentives worth an estimated $650 million in cash grants, tax-exempt bonds, sales and utility tax breaks and discounts on required payments in lieu of taxes. Since then, Chase, and have sought similar packages. City and state officials have rebuffed them.

“The atmosphere in the city and downtown has changed dramatically since Sept. 11,” said Patrick J. Foye, co-chairman of the Empire State Development Corporation, who is talking with Chase executives. “Rents downtown are very strong and demand continues to grow. The state would welcome JPMorgan moving part of its operations to the city’s vibrant downtown.”