Should You Buy Now? Fixer-Upper or New Build? Let’s Talk Options!

Should You Buy a Home Now? Insights from Art Alvarez at MortgageWorks

In today’s shifting real estate market, many potential homebuyers find themselves at a crossroads, asking a familiar question: Should I buy now? And if so, should I choose new construction, an existing home, or a fixer-upper? According to Art Alvarez of MortgageWorks, now might be the right time to act—and he brings compelling evidence to back it up.

---

Understanding Today’s Market Conditions

Across much of the country, inventory levels are increasing. While they haven’t returned to pre-pandemic levels, buyers are no longer facing the same frenzied competition that defined the market in recent years. Homes are sitting longer on the market, so sellers may be more willing to negotiate. This opens the door for concessions, such as price reductions or credits toward closing costs and interest rate buy-downs, that weren’t as easy to come by in the recent past.

Art emphasizes that this buyer-friendly shift in the market may not last forever. Historical data suggests that waiting for home prices or interest rates to drop significantly is a strategy that rarely pays off. In fact, since 1950, home values in the U.S. have only declined in seven out of 75 years. That means buyers who are waiting for a dramatic drop in prices may be missing out on valuable time to build wealth through homeownership.

---

New Construction vs. Existing Homes

When deciding what kind of property to purchase, buyers need to weigh the pros and cons of new construction versus existing homes. New homes offer all the bells and whistles: everything is modern, clean, and up to code. Many builders allow buyers to choose custom finishes and upgrades through design centers. These homes also come with warranties and the peace of mind of brand-new infrastructure.

However, new construction comes at a premium. The price tag is generally higher, and although builders often offer attractive incentives, such as closing cost credits or interest rate buy-downs, those costs are often baked into the price of the home. In other words, the perks are appealing, but you’re likely paying for them in one way or another.

On the other hand, existing homes often allow more room for negotiation. With the right timing and strategy, buyers can secure seller credits or reduced prices. This flexibility can be especially valuable for first-time buyers or those looking to customize their homes post-purchase.

---

Fixer-Uppers: A Pathway to Equity

For buyers with some DIY know-how—or access to skilled tradespeople—a fixer-upper presents an exciting opportunity. Art suggests that many homes on the market need only cosmetic updates. By opting for a low down payment mortgage program, such as a 3% down conventional loan or 3.5% down FHA loan, buyers can reserve their saved funds for renovations rather than upfront costs.

There are also specialized renovation mortgage options available. Fannie Mae's HomeStyle Renovation, Freddie Mac's CHOICERenovation, and FHA's 203(k) programs allow buyers to finance both the purchase of the home and the cost of repairs or upgrades. There’s even a “Pool Plus” program for buyers wanting to add a pool to their property as part of their financing package.

For first-time buyers, these programs can be powerful, but they do require guidance. Art stresses the importance of working with a mortgage professional early in the process and securing a contractor before making an offer.

---

Opportunities for Current Homeowners

Even existing homeowners have options. If you’re sitting on a substantial amount of equity, now may be the time to reinvest in your home. MortgageWorks offers several equity-based loan options that can fund improvements to increase the value of your home even further. Whether you’re planning a major remodel or simply want to add amenities that increase resale value, tapping into your equity strategically can offer a solid return on investment.

---

FAQ

Is now a good time to buy a home, or should I wait?
While every buyer's situation is different, the historical trend shows that home values rarely fall. Waiting for prices or interest rates to drop significantly often results in missed opportunities for wealth-building through homeownership.

What are the advantages of buying a new construction home?
New construction offers modern features, customization through design centers, and fewer maintenance concerns. Builders often provide incentives, but the cost of these is usually reflected in the home’s price.

Why consider an existing home or a fixer-upper?
Existing homes offer greater room for negotiation and potential for instant equity through improvements. A cosmetic fixer-upper may be more affordable and customizable, especially with renovation loans.

Are there financing options for renovations?
Yes. MortgageWorks provides access to several renovation programs, including Fannie Mae HomeStyle, Freddie Mac CHOICERenovation, and FHA 203(k). These allow you to combine the home purchase and renovation costs into one loan.

Can I use my current home’s equity to fund improvements?
Yes. If your home has appreciated in value, you can use an equity loan to finance renovations that may further boost your home’s value.

---

Ready to Stop Waiting and Start Building Wealth?

At MortgageWorks, we believe in empowering you with knowledge and personalized solutions. Whether you’re ready to buy a move-in-ready home, roll up your sleeves with a fixer-upper, or explore renovation financing, we’ll walk you through your options every step of the way.

Contact Art Alvarez and the MortgageWorks team today to get expert advice tailored to your goals. Your answers are just a call away—and they’re on the house.

* Specific loan program availability and requirements may vary. Please get in touch with your mortgage advisor for more information.