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I recently came across a 60 Minutes segment that featured a small building boom in of all places, Las Vegas.  Yes, Las Vegas, home of thousands of foreclosed properties flooding the market.  The gist of the segment was that developers found a niche for buyers who were willing to pay a premium for "new", i.e, unlived in homes as opposed to homes that had previous owners.  These buyers wanted to choose their own paint colors and amenities and wanted appliances and carpets that were previously unused.  There is however one problem with this concept: like new cars driven off the lot, one minute after the purchase of these new homes they become "used" homes and fall in value. 

I thought this was simply crazy until I was presented with an appraisal project in the Westbank.  The home was in a new subdivision and sold new to the owner for $260,000 in May of 2009. In the MLS however previoulsy owned homes in the subdivision, that were only 2-5 years of were selling for significantly less.  I examined Deedfax and MLS and found a pattern: Sales since 2009 have remained relatively stable. However, the prices paid by buyers for NEW homes in this marketing area was significantly higher then for homes placed on the market by individual sellers.  Simply put, the higher priced non-listed homes sold for more than homes recently constructed but with prior owners listed on MLS.  
 
I can only guess that the same factors that influenced the Las Vegas buyers are at work here--a certain segment of the buying market makes a large distinction between these two types of home sales, preferring to buy new construction with the amenities and colors they want coupled with the satisfaction of having appliances and carpets etc. that are new.  The result however is that "used" homes in the marketing area sell for less.

Unlike cars, homes have traditionally appreciated in value. However, it's sad to see uninformed buyers looking past homes that are a good value for homes with the equivalent value of a used car.

My advice?  Buy that foreclosure or previously owned property and make your way to Lows and purchase for yourself some new appliances, paint and carpeting. Saving a bundle and create an investment that will appreciate in value.