A $500K new build can sometimes have a lower monthly

A $500K new build can sometimes have a lower monthly payment than a $450K resale.

Here’s the math:

-> Option 1: Resale Home

Purchase price: $450,000
Interest rate: 6.25%
Estimated principal + interest: $2,771/month

-> Option 2: New Build

Purchase price: $500,000
Builder incentive rate: 4.99%
Estimated principal + interest: $2,681/month

So even though the new build costs $50,000 more...

The estimated monthly principal + interest payment is about $90 less per month.

Why?

Because the interest rate matters.

A lower builder-paid rate can sometimes make a higher-priced home feel more affordable monthly than a lower-priced resale home with a higher rate.

But here’s what buyers need to remember:

You still have to compare:

Property taxes
Home insurance
HOA fees
PMI
Closing costs
Builder fees
How long the lower rate actually lasts

The point is not that every new build is cheaper.

The point is this:

Do not compare homes by price alone. Compare the full monthly payment.

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— Dream Mortgage

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