Buying Resale vs. Buying New Construction

1. Who is selling the home?

In a resale transaction, you're buying from an individual property owner, typically represented by a listing agent. In new construction, you're buying from the builder or developer, represented by the builder's own sales office or a sales representative.

2. Buyer representation

In a resale transaction, a buyer typically works with their own buyer's agent, who owes the buyer certain representation duties. When purchasing directly from a builder, a buyer may still choose to have their own agent — many builders have a registration process requiring the buyer's agent to be registered on the buyer's first visit or contact, so timing matters if you want your own representation. Builder registration requirements vary by builder and community.

This is a choice with tradeoffs, not a rule with one right answer. A buyer without their own agent relies entirely on the builder's sales office for information — which is not the same as buyer-side advice, since the sales office's role is to sell that community's homes.

3. Price negotiation

Resale negotiation centers on the asking price, comparable recent sales, competing offers, seller credits, and contingencies. New-construction pricing works differently: a builder publishes a base or "from" price, then adds lot premiums, upgrades, and options — and separately maintains inventory/spec-home pricing for homes already under construction or complete.

4. Financing

You can typically choose your own lender in either a resale or new-construction purchase. Builders frequently offer their own preferred-lender incentive — a rate buydown (temporary or permanent), a closing-cost credit, or both — in exchange for financing through their preferred lender. These incentives can be genuinely valuable, but they need to be evaluated against the home's total real cost, not just the sticker price.

A lower advertised price with no incentives and a higher advertised price with a large incentive can land at a similar real monthly cost — or a very different one. This is exactly what True Cost is built to show: enter the home's price plus any builder credits under New Construction Adjustments, and compare the actual monthly and cash-needed numbers.

5. Deposits

Resale purchases typically involve an earnest-money deposit, held in escrow as a sign of good faith once you're in contract. New-construction purchases often involve a builder deposit at reservation or contract, and sometimes separate deposits for design-center upgrades or options — with their own, sometimes different, refundability terms.

6. Inspection

A resale purchase typically includes a general home inspection covering the property's current condition. New construction has its own inspection points: a pre-drywall inspection (before walls are closed up, when framing/plumbing/electrical are still visible) where the builder permits it, a final inspection before closing, and a walkthrough/punch-list process to flag items for the builder to fix. Most new homes also come with a builder warranty covering defects for a defined period.

Not every builder permits every inspection type, and some builders are more receptive to an independent third-party inspector than others — ask directly what's allowed before you're under contract.

7. Timeline

A resale purchase is generally an existing home, so the timeline is mostly the contract-to-close process. New construction spans a much wider range: a move-in-ready/spec home available now, a home still under construction with an estimated completion window, or a planned future release that hasn't started construction yet.

8. HOA and special taxes

Both resale and new-construction homes can have an HOA, special assessments, or special taxes — none of these are exclusive to one or the other. Newer master-planned developments in particular may also involve a Community Facilities District (CFD/Mello-Roos) special tax, and sometimes multiple associations (a master association plus a sub-association for one phase or building).

For the full explanation and a property-verification workflow, see the Mello-Roos / CFD guide.