Options for Newly built Houses

Post date: 9/20/2024

If you want to live in a newly built house, you have the choice between a custom-built house that you build yourself from scratch or a ready-built house with a fixed plan and price. In addition to degrees of freedom in the design, there are major differences between custom-built and ready-built houses, such as financial planning and the schedule for moving in, so let's review the characteristics of each.

1. Custom-built house – Acquiring land and building a house

A custom-built house is a method of purchasing land and requesting a construction company (house builder, building contractor, design office, etc.) to design and construct a house. You can consult with the construction company you want to work with and freely decide on the floor plan, design, and even the selection of equipment and building materials, allowing you to build a house to your own liking.

2. Ready-built house – House sold by construction company

A house that has been built by a construction company and is sold with land is called a ready-built house. A large area of land is developed and divided, and the houses for sale built on that land are also ready-built houses. Most of them are sold as completed, but some may be sold in an under-construction or pre-construction state.  In the case of a house in pre-completion state, some options, such as equipment, may be available, although they are limited in terms of the cost and within standards.


It is similar to ready-built housing in that the land and building are sold as a set, but there is the other option of buying a land lot subject to construction of a house (URITATE House), where the land is sold as a vacant lot and the house is built by a construction company designated by the seller.

3. Land lot subject to construction of a house (URITATE House)

It is a land with the condition that "after purchasing the land, the house shall be built within a certain period of time by a designated construction company”. A certain period of time is generally 3 months, and within the period, it is necessary to decide on the floor plan and specifications, and conclude a construction contract with the construction company designated by the seller. Although the construction company is designated, you may decide the floor plan and specifications relatively freely. Degrees of freedom in the design and construction costs vary depending on the property, so be sure to check the details in advance.

Difference Between Custom-built House and Ready-built House

Cost of Newly built Houses

The main price of ready-built houses is often more reasonable than that of custom-built houses because the construction company purchases building materials and equipment in bulk, which keeps costs down, and because the floor plan and design are standardized, labor costs for design and staff meetings are reduced.

Financial Planning

For ready-built houses, the land and buildings are purchased in a lump sum, so the necessary expenses are clear, and it is easy to make a financial plan. On the other hand, for a custom-built house, the purchase of the land and the construction of the house are separate, so if a housing loan is used, it is necessary to take out a bridge loan or advance loan to buy the land upfront, which complicates financial planning.

For more information, see Buying Land and Building a House on it - Costs of Buying Land + Building a House on it and Housing Loan.

Length of Time required to Move-in

Custom-built houses are time-consuming because of the many procedures involved such as land purchase, design meetings, and construction.  As a rough guide, it takes 3 to 6 months from land search to land purchase, and 3 months at the shortest to 10 months at the longest from land purchase to construction contract. Once construction begins, it takes about 3 to 10 months for completion and delivery. In many cases, it may take more than 1 year to complete the whole project if you start from the land search.

For more information, please refer to Process of Buying Land and Building a House on it.

If a ready-built house has already been completed, you can make a purchase decision after viewing the house, and you can move in right away. If the house is under construction or about to be built, it may take 3 to 6 months to complete and deliver the house.

We have shown you the difference between custom-built houses and ready-built houses.  You should consider which one to choose from the viewpoint of how much time and effort you can spend before moving in, and whether it is difficult to realize the house you envision with a ready-built house.

 

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