You Should Never Buy These 12 Things New

Man with guitar
Luis Molinero / Shutterstock.com

Some things really are better the second time around.

In fact, many used items can be every bit as good as those purchased new. Plus, buying used almost always saves you cash.

So, without further ado, following is our list of the top things you should never buy new.

1. Timeshares

pbk-pg / Shutterstock.com

Don’t ever pay full price for a timeshare. Some people are practically giving them away because they’re so desperate to get out from under the annual fees.

As Money Talks News founder Stacy Johnson puts it in “Ask Stacy: How Can I Sell My Timeshare?“:

“I’d chop off my own foot with a dull ax before buying a timeshare, especially a new one from a developer.”

2. Basic tools

javitrapero.com / Shutterstock.com

If you are handy, you need a good set of tools. Buying tools used typically will save you money, and you might even end up with something that is better crafted than what you would find new today.

In fact, Money Talks News’ resident thrifting expert Kentin Waits cites tools in both “8 Things I Always Buy at Thrift Stores” and “7 Things You Should Buy at Estate Sales.”

If you aren’t handy, you might be able to check out tools from your local library when you do need them.

3. Cars

Driver with thumbs up
pathdoc / Shutterstock.com

We’ve talked about it time and time again: The value of a new car drops like a rock as soon as you drive it off the lot.

Rather than finding yourself upside-down on your car loan five minutes after signing the paperwork, look for a quality used car that has already taken the huge depreciation hit.

4. Books

TORWAISTUDIO / Shutterstock.com

We could take this category one step further and say you shouldn’t buy books at all. Many of us live near a public library system that can meet most of our reading needs.

However, we won’t go quite to that extreme. I personally enjoy having a well-stocked home library. I also realize that some books, such as college textbooks, have to be purchased. But that doesn’t mean you have to pay full price.

Check out “11 Places to Find Free E-Books,” or head to Amazon to find cheap used books, which are often as good as new.

5. Big toys like boats, motorcycles and RVs

Boating
freevideophotoagency / Shutterstock.com

That advice about buying a used car can apply to any type of vehicle.

Virtually anything with an engine — from off-road vehicles to yachts — will depreciate over time. So, in most cases, you’ll get more bang for your buck by purchasing used.

New boats, for example, depreciate quickly. So, even if you buy a vessel that’s just 1 year old, you stand to save a boatload.

6. Houses

sirtravelalot / Shutterstock.com

Your house is another big-ticket item that is better to buy used rather than new. Not only can you save money, but older homes also may have better “bones” than some new construction.

If you love the idea of new construction, remember that an existing home doesn’t necessarily have to be 50 years old. If you want an energy-efficient home with new amenities, you can probably find it at a lower price if you’re willing to be owner No. 2 or No. 3.

7. Movies and CDs

Monkey Business Images / Shutterstock.com

Many of the same places that sell used books also sell used DVDs, Blu-ray Discs and CDs. No need to spend money for a new disc when you can get a used one for less money online, at a garage sale or in the thrift shop.

Of course, there’s also your public library, where movies and music are free for the (temporary) taking and cheap when the library holds a sale.

8. Sports gear

Africa Studio / Shutterstock.com

Raise your hand if your kids have ever started a sport and quit after one season. I’m right there with you.

Instead of spending tons for new equipment, go to a specialty store like Play It Again Sports and buy used items. You can also scour garage sales, thrift stores and Craigslist for bargain finds.

Don’t forget to look for fitness equipment for yourself, too. Buying new weights and kettlebells, for example, doesn’t make sense if you can get used ones for a fraction of the price.

9. Musical instruments

Africa Studio / Shutterstock.com

Musical instruments are another parental purchase that could be money down the drain.

To avoid purchasing something overpriced or broken when buying used, consider spending a few dollars to have it appraised by a local music store. Or, better yet, buy a used item directly from a shop.

Renting an instrument is another option. However, keep in mind that renting a clarinet for three years could end up costing you more than if you purchased a used one in the first place.

10. Jewelry

Jasmin Awad / Shutterstock.com

Jewelry is also better bought used than new. Before buying off Craigslist or from a private seller, however, be sure to get an appraisal, particularly if a significant amount of money is involved.

You can also find quality used baubles by shopping for estate jewelry from jewelers or reputable pawn shops.

11. Gift cards

Gift cards
Iryna Tiumentseva / Shutterstock.com

Here’s one you probably haven’t thought about. Some people receive a gift card to a retailer they don’t like. Others use a portion of a gift card, but have no reason or desire to spend down the remaining balance.

You can find unwanted gift cards by going to a site like Raise. Buying “used” gift cards in this fashion can save you a bundle, as we detail in “How Unwanted Gift Cards Save Me Hundreds of Dollars a Year.”

12. Pets

Inna Astakhova / Shutterstock.com

Some of you might disagree, but there really is no reason to spend a lot of money on a brand-new pet from a breeder when plenty of preloved (or not so loved) animals need homes.

My local animal shelter and Humane Society regularly have free or almost-free adoption days, during which you can bring home everything from dogs and cats to bunnies and birds. Your local shelter might offer the same.

Unless you’re planning to show your pet, spending hundreds or even thousands on a purebred animal is probably not money well-spent. The $50 puppy from the pound is just as likely to smother you with wet kisses and stare at you with unbridled adoration.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

About: Kiplinger’s Economic Outlooks

Gross Domestic Product

Gross domestic product is the broadest indicator of the economy, measuring the value of final goods and services produced in the U.S. in a given time period. It is perhaps the most closely watched indicator as well, serving as a guidepost for Federal Reserve interest rate policy and for budgeting in both government and private industry.

At Kiplinger, we examine what trends are driving GDP up (or down) and forecast its future direction quarter by quarter. Read our current forecast »

Employment

If gross domestic product is the broadest indicator of the economy, employment is the one most personally felt. These are people’s jobs we’re talking about.

Two distinct metrics make up the employment forecast. The more important one is the “payroll report,” a summation by the Department of Labor of how many jobs the economy has created (or lost) each month. This data is broken out by sector, such as manufacturing, mining and health care. Note that simply to keep up with population growth, the economy needs to add more than 100,000 jobs every month; otherwise the unemployment rate will rise.

That rate is the other closely watched figure. It’s a simple division of the number of people who have looked for work in the prior four weeks but who do not have a job by how many people are currently in the labor force. That simplicity belies some underlying concerns about the unemployment rate. One key one: Potential workers who aren’t actively looking for work aren’t included in the calculation. Read our current forecast »

Interest Rates

Interest rates are of tremendous interest to borrowers (for whom they are a cost) and lenders (a category that includes individuals trying to get some return on their bank savings). Almost everyone is in one or both categories.

The level of short-term rates, such as those used by banks when loaning each other money overnight, is set by the Federal Reserve through its Open Market Committee, usually at regularly scheduled meetings.

Market interest rates, including those in money markets and offered on consumer products such as certificates of deposit, follow the Fed’s lead but are also subject to other influences — for example, risk, transaction costs and expectations of inflation. Generally, the longer the period of the loan, such as with 10-year Treasury Bonds or mortgages, the more important market factors become compared with the Federal Reserve’s actions. We forecast both what we expect the Federal Reserve to do in the near term and to what extent that will affect the direction of long-term interest rates. Read our current forecast »

Inflation Rate

Inflation is the generally rising price of goods and services, or why things cost more. It’s measured by the Department of Labor using a sample, dubbed a “market basket,” of what people in urban areas in the U.S. actually buy each month. Then each month, data collectors check on the prices of those items. From that research we get the Consumer Price Index (CPI).

A component of that index, the core inflation rate, which excludes the more volatile prices of food and energy, is also closely watched. At Kiplinger, we forecast changes in both.

Economists generally believe that moderate inflation of about 2% is best for an economy. Prices that are rising too quickly cause consumers heartburn, of course, but prices that are flat or falling are a problem, too. This condition, known as deflation, makes debts more expensive to pay back and can lead to declining business investment. Read our current forecast »

Business Equipment Spending

How much businesses are laying out in investment is critical to other businesses in guiding their own spending. In making our forecasts for the direction of business spending in the quarters and years ahead, we follow two indexes from the Census Bureau: Durable Goods Shipments and Orders and Business Inventories reports. Read our current forecast »

Energy

Like it or not, petroleum and natural gas remain incredibly important to the U.S. economy. Knowing where oil prices are headed is critical to businesses of all stripes, from airlines to plumbing companies. Consumers planning their family budgets and vacations care, too. Not only do we monitor Department of Energy reports, but we also talk to commodities traders and petroleum engineers to forecast price trends, changes in production technologies and consumer habits. Read our current forecast »

Housing

In addition to being the roof over our heads, housing is an important sector in the economy. Three statistics form the core of our coverage: sales of existing homes (and the prices those sales fetch); sales of new homes; and housing starts, which reflect new construction that is counted in GDP.

Because housing is a diversified and highly regional industry, our reporting and forecasting are informed by other research as well as conversations with industry experts as well. Read our current forecast »

Retail

Consumers are the engine of our economy, and when their spending flags, business feels it. We examine trends that are influencing their habits, such as falling gas prices, to forecast what they’ll be buying in the future and how much they’ll be willing to shell out both on everyday items and on big-ticket purchases such as cars and trucks. Read our current forecast »

Trade

All nations of consequence trade with others. Those that buy more from other countries than they sell in turn have a trade deficit, and that’s been the story for the United States since the mid-1970s.

How big that deficit will be, and whether the changes will result from more (or fewer) imports or more (or fewer) exports, is the crux of our forecasting. We look at specific sectors (such as agriculture) where the United States is doing well selling abroad, as well as what items (such as smartphones) we buy from overseas. We also discuss the strength of the dollar versus foreign currencies and how that affects trade trends. Read our current forecast »

Source: kiplinger.com

Should You Buy a New Home or an Old Home?

It’s time for another match-up, this time we’ll compare buying a new home versus purchasing an old one.

For the record, some home builders refer to existing homes as “used,” which sounds kind of silly considering we’re talking about a house and not a car.

Ultimately, it’s a marketing gimmick to sway you toward buying new as opposed to old, but let’s continue on to determine the pros and cons.

Millennials and Gen X Are Big on New Homes

types of home buyers

A recent report from the National Association of Home Builders found that interest in newly-built homes has surged.

They noted that during the fourth quarter of 2020, 41% of prospective buyers were searching for a newly-built home, double the 19% share a year earlier.

At the same time, the share interested in an existing home fell from 40% to 30%.

It’s even more pronounced when we break it down by generation, with 50% of Millennial and 48% of Gen X buyers looking to buy a new home.

Meanwhile, just 13% of Boomers indicated that they were looking for a new home vs. existing.

Interestingly, Gen Z is a little more into existing homes than Boomers with a 38% share, but still below that of Millennials and Gen X.

New Homes Are Untouched and Clean

  • The number one reason to buy a new home is probably the fact that it’s never been lived in
  • Some people may not like the idea of living somewhere that was previously occupied
  • It also might feature the newest amenities such as improved insulation and solar panels
  • And in theory you shouldn’t have to repair or renovate anything right away

The most obvious benefit to buying a new home as opposed to an old, existing, or used one is the fact that it’s brand spanking new.

It’s untouched, it’s clean, everything is in good working order and nothing needs to be repaired. At least that’s the hope.

That’s a pretty huge incentive to buy new. You won’t have to worry about the typical costs of homeownership for the first several years, right?

Another benefit to buying new is that the home (or townhouse or condo) should have all the latest amenities.

Remember when it was all the rage to have stainless steel appliances and granite countertops?

Well, today’s new homes come with solar panels, energy-saving windows, smart appliances, USB outlets, electric vehicle charging stations, thermostats and door locks you can control with your phone, and other features that might make your used home look really old, especially a few years down the line.

Aesthetics aside, these upgrades could actually save you a lot of money each year on utility costs because they’re designed to be cost-efficient, not just handy.  You might even get a tax break!

Not only that, but many of these new homes use low-VOC paints and flooring, which are supposedly better for your health. Who knows what lurks in some of the older homes?

Additionally, new home buyers often get the opportunity to fine-tune the home they buy by selecting certain features, colors, styles, etc., and even financing any add-ons into the mortgage loan amount.

It Can Be Easier to Buy a New Home

  • It might be easier to finance a new home with a mortgage
  • Home builders often have their own home loan divisions
  • So they’ll be motivated to work with you to get the deal done
  • But still take the time to shop around and negotiate since you don’t need to use their preferred company

And speaking of mortgages, most home builders have their own financing departments that make it easy to get a mortgage.

Whether it’s the best deal is another question, but if you simply want in, your odds are probably better with a new home.  After all, the builder has a vested interest to get you financing.

There’s probably also a lot less competition for a new home, seeing that you’re probably checking out a brand new neighborhood full of vacant homes to choose from.

This can be a huge advantage in a seller’s market, which we’re experiencing at the moment. Instead of a bidding war, you might be able to pick and choose from a selection of available properties.

You can even pick among different sizes and floor plans to get just the right amount of space, as opposed to having to conform to what’s available in the existing market.

You might be thinking, hey, this sounds great, sign me up now! Why on earth would I want a used home with dodgy popcorn ceilings and laminate countertops?

But wait, there’s more to homes than their shiny exteriors and what’s inside.

Don’t Forget About Location…

  • Location is and will always be the biggest property value driver
  • And new construction homes are often in less desirable areas
  • Or in the outskirts of urban areas because that’s where new land is available
  • Be sure to take that into consideration as a major tradeoff to buying a new home

Let’s face it; the old adage that location is everything in real estate is true. It’s always been true, and always will be true. That is, if you want to see your property actually go up in value.

And guess what. Brand new homes often ren’t being built in the best locations. When it comes down to it, there’s no space for a new development in an established or central location.

Sure, you might see a new condo development, but new homes most likely won’t be that central. They’ll be on the outskirts of town, or in a “trendy” or “up-and-coming” area.

In other words, there’s going to be a commute if you buy new, and the location might be questionable at best in terms of value.

There might even be multiple new developments surrounding yours, with tractors and hammering construction workers doing what they do all day long.

That being said, it is possible to buy a new home in an area that flourishes. One hint it’s the right area might be the stores that are built nearby, such as a Whole Food’s or Trader Joe’s.

Of course, with an existing or used home, you can buy in the heart of the city, or in an area you know well that is insulated by a lack of available space and construction.

That buffer means the property should hold up well in terms of value, even during a downturn, assuming the area isn’t subject to obsolescence.

A used home might also give you the ability to walk to work, or to popular restaurants, bars, shops, and so on.

At the same time, a used home doesn’t necessarily have to be old inside. If you shop around, you might be able to find an old home that has already been remodeled to your liking.

And even if it hasn’t, that shouldn’t stop you from buying it and making renovations if it’s got good bones.

New Homes Are 20% More Expensive

  • Ultimately you pay a premium for a new home (just like a brand new car)
  • Apparently the cost is 20% more on average per a study from Trulia
  • So while a new home might be cheaper with regard to maintenance and renovation
  • You still need to consider the upfront cost to get an apples-to-apples comparison

A while back, Trulia determined that new homes (built in 2013-2014) cost roughly 20% more than similar existing homes.

They also found that two in five Americans would prefer to buy a new home, compared to just 21% opting for an existing home and 38% declaring no preference.

But when it came to that 20% markup, only 17% would actually pay the premium to get the new house.

So to get this straight, you might have to pay 20% for a new home AND you won’t be in a central location.

You’ll be in an untested location that might wind up being a ghost neighborhood in a decade if things don’t work out as planned.

During the most recent housing crisis, a lot of new home communities were hit the hardest, whereas existing homes saw their values decline but prop back up over time.

Of course, if you opt for new you’ll probably have all the latest technology and no major issues.

And if you go with an older home, you might have major bills on your hands when the roof gives out, or you discover serious plumbing issues.

So you’ll need to do your due diligence when buying an old home to ensure the property is in adequate shape. This means paying for a quality inspection (or two).

Then again, I’ve heard really negative stuff about new homes too, with many claiming workmanship has gone to you know what these days.

In other words, you’re not out of woods if you buy new either, though there might be some kind of warranty in place for a while.

At the end of the day, it’s probably okay to consider both new and used homes when looking for a property, and including both types should increase your odds of finding a winner.

As long as you take the time to inspect the property and the neighborhood, negotiate the right place, and make sure you can afford the place, you should be okay.

Lastly, you should make sure you actually want to own as opposed to rent because owning comes with many more responsibilities, whether you buy new or used.

Advantages to Buying a New Home

  • Brand new, clean, no major issues
  • Move-in ready (no wait or work to be done)
  • Cool new technology
  • Green features could reduce utility costs and/or provide tax incentives
  • Trendy design
  • Ability to customize
  • Can finance additions into mortgage
  • Possibly easier to get financing with home builder
  • Less competition, more choices on floor plans

Disadvantages to Buying a New Home

  • More expensive than buying used
  • Location probably isn’t ideal
  • Despite being new, workmanship might be questionable
  • Could be subject to costly HOAs, even if it’s a house
  • Neighborhood dynamic is unknown
  • Property values might be more volatile
  • Construction nearby (eyesore and noisy)
  • More cookie-cutter, less unique

Advantages to Buying an Existing Home

  • Possibly cheaper
  • Better, more central location
  • Can buy in an established school district
  • Can own in a more reputable and recognized neighborhood
  • Old house might have new upgrades
  • You can always renovate if need be
  • Older houses tend to have more character, custom design
  • Could actually be built better than a new home

Disadvantages to Buying an Existing Home

  • Harder to find an existing home (less inventory)
  • Might have major problems you don’t initially notice
  • Financing could be tricky (if unpermitted work, etc.)
  • Could still be more expensive than buying new
  • Fewer amenities, especially as homes get more tech-integrated
  • The neighborhood might be in decline
  • More competition to get your offer accepted
  • Might have to settle for a smaller, less ideal home to get right location

Source: thetruthaboutmortgage.com

Braves Shortstop Dansby Swanson Snags $1.6M Atlanta Estate, Sells Georgia Townhome

The Atlanta Braves shortstop Dansby Swanson has purchased a new home base in Atlanta for $1.63 million. He picked up his new digs in November 2020.

The brand-new build initially landed on the market in June 2020 for $1,695,000. The price was shaved down to $1.67 million in the fall, before Swanson managed to negotiate an even lower price to seal the deal.

Set on 1.3 acres in the city’s Sandy Springs area, in an older but quiet neighborhood, the brick estate was completed in 2019 by John Willis Custom Homes.

With five bedrooms and 5.5 bathrooms on 4,529 square feet of living space, the open floor plan is designed for entertaining. There are cozy living spaces both inside and outside. The layout features a walk-out backyard, with a covered patio and outdoor fireplace for colder evenings.

Newly constructed estate in the Sandy Springs neighborhood of Atlanta
Newly constructed estate in the Sandy Springs neighborhood of Atlanta

realtor.com

The dining room and paneled study have plenty of natural light streaming in. The family room features a fireplace flanked by custom built-ins and a wet bar, and the room overlooks the spacious and private yard.

In the chef’s kitchen, there’s a gigantic marble island, custom cabinetry, stainless appliances, and a large walk-in pantry. The kitchen opens to the breakfast room and family room. A guest bedroom completes the main level.

Upstairs, the master suite offers a designer bathroom with a walk-in shower, oversize tub, and double closets with a dressing area. There are three more en suite bedrooms on the upper level.

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Watch: ‘Bull Durham’ House in NC Is Actually a Historic Gem From 1880

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Additional features in the home include a home office, mudroom, and powder room. The unfinished basement is ready for personal touches and is already equipped with plumbing.

Before picking up the new construction, the player had purchased a Sandy Springs townhome in 2019 for $572,000. In December 2020, he took a slight loss, when he sold the place for $553,700.

The 2,016-square-foot townhome features a white and gray palette, an open plan, two bedrooms, and 2.5 bathrooms. A comment on Reddit from a delivery driver for Uber Eats told how he delivered the baseball star a small buffalo chicken pizza at the townhome about a year ago. Stars, they’re just like us!

Condo that Dansby Swanson sold in December
Condo that Dansby Swanson sold in December

realtor.com

Apparently, the Atlanta native also maintains a home in his birthplace of Kennesaw, GA. He purchased the four-bedroom build in 2017 for $315,000, bought through an LLC he is associated with.

Swanson, 26, also owns a two-bedroom, two-bathroom condo with 1,300 square feet in downtown Nashville, TN. He picked up the place in Music City in 2015 for $530,000.

He grew up in Cobb County, GA, where he attended Marietta High School and played basketball and baseball. He made his big league debut in 2016 for his hometown team. Now heading into his sixth season with the Braves, the slugging shortstop has become a fixture in the infield.

Swanson was represented by Shanna Bradley with Ansley Atlanta Real Estate for the purchase of his newly acquired home and for the sale of his townhome.

Source: realtor.com

What Does a Builder’s Warranty Cover?

Builders’ warranties vary greatly, so it’s important that homeowners take the time to learn what’s covered.

Even with new homes, things can go wrong. That is why many buyers of newly built homes are interested in warranties, which promise to repair or replace certain elements of the home.

Many home warranties are backed by the builder, while others are purchased by builders from independent companies that assume responsibility for specific claims. In other cases, homeowners purchase coverage from a third-party warranty company to supplement coverage provided by their builder. In fact, the Federal Housing Authority (FHA) and the Department of Veterans’ Affairs (VA) require builders to purchase a third-party warranty as a way to protect buyers of newly built homes with FHA or VA loans.

The key to any of these warranties is to understand what’s covered, what’s not covered, how to make a claim and the process for resolving disputes that might arise between you and the builder or warranty provider.

Most warranties for newly constructed homes offer limited coverage on workmanship and materials as they relate to components of the home, such as windows, siding, doors, roofs or plumbing, electrical and HVAC systems. Warranties typically provide coverage for one to two years, although the specific time period may vary by from component to component; coverage may last up to a decade on major structural elements. Warranties also routinely define how repairs will be made and by whom.

Warranties generally do not cover household appliances, tile or drywall cracks, irrigation systems or components covered under a manufacturer’s warranty. Most warranties also exclude expenses incurred as a result of a warranty repair construction, such as the need to store household belongings while a repair is being made.

Before you close on your new home purchase, you should ask your builder – or your third-party warranty provider – these questions:

  • What does this warranty cover?
  • What is not covered by this warranty?
  • What’s the process or timeliness if I have a claim?
  • Is it possible for me to dispute your decision to deny a claim?
  • What is the extent of your liability?
  • Can you refer me to other new home owners with whom you’ve worked so I can speak to them about warranty coverages?
  • Where are some of you previous projects so I can speak with owners there?

The information you gain may not be enough to send you running from your new home deal, but it should help you understand where you’ll stand if you ever need to file a claim. You should also check with your state’s Attorney General Office or contractor licensing board to make certain your builder is offering all warranties he’s required to provide.

To learn more about builders’ warranties, contact your state or local builders’ board. If you’re making your home purchase with an FHA or VA loan, those organizations can also provide you with additional information.

Originally published June 11, 2014

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Source: zillow.com