Convenience. Kitchens in new homes usually have dishwashers and other appliances built-in for convenience. Nearly all new homes are built with convenient central heating and, in warm climates, central air conditioning. Space heaters and room air-conditioners are not needed. There are more electrical outlets, as well as outlets for cable TV and telephone. Bathrooms often have more convenient features such as vanity cabinets, large mirrors and medicine cabinets, whirlpool tubs and easy-to-clean plastic tub enclosures.

Safety. Occupants of new homes are much less likely to die from fire than occupants of older homes. Many new homes have hard-wired smoke detectors on every level. Usually, they are interconnected so that if one detector alarm sounds, they all sound. In many areas, smoke detectors are required to have battery back-up. This feature allows detectors to function even when the power goes out.

Space heaters and wood stoves, the second leading cause of fire deaths, are not needed in new homes because of more efficient central heating systems and better insulation. Electrical power systems in new homes are properly sized for the heavier electrical demands of today's homes, and wiring systems are less likely to cause fires. There also are more receptacles so people need fewer extension cords which can overload circuits, trip people and start fires if they become worn and frayed.

Circuit breakers have replaced fuse boxes which can be overloaded by using the wrong size fuse. Ground fault interrupters for bathrooms, kitchens, and outside receptacles reduce the chance of fire and electrocution. Glass in tub enclosures and patio doors in new homes must be tempered so that it will crumble if broken instead of shattering into large jagged pieces that can seriously injure people.

Health. Much has been learned about the health risks of certain home building products in recent years. The industry has responded by building with products and systems that make new homes better for your health than older homes.

Asbestos has been eliminated from shingles, pipe, cement board, roof tar, floor tiles, ceiling tiles and insulation. If asbestos fibers become airborne, they can increase the risk of respiratory diseases. Lead can cause a wide range of physical and mental ailments. It is not used as an ingredient in paint anymore, and it is no longer used as solder for plumbing. Formaldehyde emissions from particle board and hardwood plywood have been greatly reduced in new homes. And urea-formaldehyde finishes on most kitchen cabinets are now baked or cured to minimize emissions.

Builders are now installing systems to control radon gas where it is a problem. These systems usually include installation of gravel and polyethylene film beneath basement floors and concrete slabs, and provide for later installation of vent pipes and fans, if required. Older homes frequently have no gravel in which to collect the gas, no polyethylene film to retard movement of the gas through the slab, and no vent pipes. Mitigating radon from an existing home is generally far more expensive than building radon prevention techniques into a new home.

Energy Efficiency. Because of better windows, more efficient heating and cooling equipment, better control of air infiltration, and greater use of insulation, new homes consume half as much energy as homes built prior to 1980. Old homes tend to be drafty and less comfortable. Also, frost and condensation are more likely to appear on windows of older homes, drip down, and cause deterioration of wood trim and walls.

Less Maintenance. New homes are available with siding, windows and trim that never need painting. Wood decks are typically made of pressure-treated lumber which resists rot and insects. Pressure-treated wood is also used where wood comes in contact with concrete.

Tax Advantages. Buying a new home is one of the smartest purchases you can ever make. One of the reasons is that homeownership has many positive tax implications. Because of changes to the tax code passed in 1997, these tax implications are much more favorable for most home owners today than in the past.

According to the law, married home owners do not have to pay taxes on up to $500,000 in capital gains realized on the sale of their homes. The $500,000 provision applies to married home owners filing joint returns and is restricted to homes sold on or after May 7, 1997. To qualify, the home would have to have been used as a principal residence for at least two of the previous five years. Taxpayers who file individual returns may claim up to $250,000.

According to the previous rules, the tax on any profit would be deferred if the sellers of the home bought and occupied another home of equal or greater purchase price within 24 months before or 24 months after the sale of the old residence.

The previous law also allowed for a one-time capital gains exclusion. Home sellers who were at least 55 years old could realize a tax-free gain of up to $125,000 if the home had been used as a principal residence for at least three of the previous five years.

Under the old law, home sellers could use their capital gains exclusion only once after turning 55. Under the new law, people over 55 who have already used their exclusion can take advantage of the new tax provisions, assuming that they have occupied their new residence for at least two of the previous five years.

First-time buyers also benefited from a special provision of the new tax law. One of the largest obstacles to homeownership usually is the inability of potential first-time buyers to save enough money for a downpayment. In 1997, Congress passed a new provision allowing first-time buyers to withdraw up to $10,000 from their IRA accounts if the money is used for a downpayment on a home. The penalty-free provision can be applied to IRAs owned by the buyers, their parents or their grandparents. Under current law, early withdrawals from an IRA incur a 10 percent penalty.

Back to Help Center