Building a House vs. Buying a Home: What is the Best Value For You?

January 5, 2026

By Julie Schmidt
V.P. of Mortgage Lending

Your home is one of the most important parts of your life. Whether you’re a first-time homebuyer or looking to upgrade your current house, when you begin considering what’s right for you and your family, one of the questions you'll ultimately end up asking is: Should we buy or build?

While cost often plays a role in the decision, the total price of building or buying a home can vary widely based on factors like location, home size, materials, and market conditions. Rather than focusing solely on price, many buyers find it helpful to compare the overall experience, timeline, and level of customization each option offers.

Below, we go into further detail to help you jumpstart the consideration process and connect you with some helpful resources along the way.

Build or Buy a House: Weighing the Factors

	Buying a Home	Building a House
Cost	Set Cost	Budget to build with possible overruns
More Room for Negotiation?	Yes	No
Energy Efficiency	Lower	Higher
Time	Move in as soon as you close.	Can take months to complete.
Customization	Minimal	You have complete control.
Immediate Repairs Needed?	Possibly	No (or covered by warranty)
Competition	You'll likely face competing bids.	No competition.

*Source: Zillow.com
**Source: HomeAdvisor

Good Reasons to build a home:

1. Customization

When you build a home, it's yours! That means you get final say over the design and construction, including all the features you've always wanted in a new home. Do you want an open floor plan? Two sinks in the bathroom? Extra space in the garage? Have it your way.

2. Energy efficiency

A new home means new appliances, better insulation and other energy-efficient benefits that could lower your monthly utility bills. In fact, according to the U.S. Energy Information Administration (EIA), the average annual energy use per home has declined despite the fact that we use more air conditioning, appliances and consumer electronics than ever before.

3. No competition

According to the National Association of Realtors (NAR), the average home is on the market for just a little more than one month before being sold. That shorter time frame means you're more likely to face competing bids. But when you build your own home, you don't have to worry about that competition.

4. Less maintenance

With a new home you'll avoid the usual wear and tear that comes an existing house. You won’t have to worry about scheduling repairs to fix issues found during a home inspection, and you likely won't need to budget for renovations (for a few years at least).

5. Warranties

If any repairs do pop up, your new home should come with a builder's warranty that should cover any repairs during the first year. Home warranties are also available for purchase when you are buying an existing home as well, with some limitations.

Note, if you are planning to build ...

Did you know that if you build a home, most banks will actually make you purchase two different mortgage loans — one for the building portion of the project, and another for the permanent financing? At Security National Bank, we've combined these into a single-close construction loan, to save you time and money. Visit closeonce.com to learn more.

Advantages to buying a home:

1. Overall investment and planning

When deciding whether to build or buy, it’s helpful to think about how much planning and flexibility each option requires. Buying an existing home typically means evaluating what’s already available on the market and choosing a property that fits your needs. Building a home, on the other hand, involves working through decisions like floor plans, finishes, and construction timelines before move-in day.

One thing many buyers notice is how predictable the process can be when purchasing an existing home. The terms of the sale are typically established upfront during the buying process. With new construction, there are often more moving parts between the time building begins and the day you move in, such as construction timelines, design decisions, and other factors that can evolve throughout the project.

2. Takes less time

Building from scratch can take months to complete. Buying and closing on an existing home can take far less time and you’re able to move in as soon as you’ve closed on the house.

3. Convenience

When building a new home, you have to consider every detail, including where to purchase land, the design of the home, and all of the fixtures and trims you want included. These decisions are already made when buying an existing home, which can make it a less stressful process.

4. More room for negotiation

A real estate agent can help negotiate the price of an existing home so you get the best deal possible. There is less room for negotiation when dealing with contractors on the build of a new home.

5. Make upgrades over time

While an existing home may not have every feature you want, you can take time to make upgrades as they become necessary and as you are able to save for them.

The process of buying a home has a lot of steps and details — but we’ve got your back! Our mortgage team is here to help you get started so that you have all the information you need to make well-informed choices for your home purchase.

About the Author

Julie Schmidt

Julie Schmidt is the Vice President of Mortgage Services at Security National Bank. A licensed mortgage loan originator, Schmidt has received the President's Club or Winner's Circle designation by the Iowa Mortgage Association every year since 2004 for her outstanding performance and customer service in the field.