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Custom Homes vs Tract Homes

Buying a new home could be one of  the largest investments you ever make, so it is really important to understand the differences in price and quality from one building method to another.

Many people ask: What is the difference between a custom home and a tract home? Below we’ve outlined the differences as well as some pros and cons to help home buyers make an educated decision before their purchase.

Custom Homes

The word “custom” refers to a home that was designed and built specifically for an individual. The design and construction of the house meets a customer’s specifications. That includes the lot selection, floor plan, material and color selection, and all of the various fixtures and finishes that make up the final product. While some custom homes are truly more custom than others, all custom homes aim to meet an individuals specific needs.

When custom homes are being built, the buyer becomes an active participant in the process. They make many choices such as colors and styles of siding, flooring, tile, hardwood, paint finishes, cabinetry, plumbing fixtures, light fixtures, counter tops, and much more. Possibilities become virtually limitless.  The builder usually sets an allowance budget for many of the items, meaning that the contract sets aside a specific amount of money for each group of items. From there, the buyer gets to select what is purchased within the provided budget allowance. We view the custom home building process as a partnership between the home buyer and their builder. We work together to design and build exactly what the customer wants.

PROS: The buyer selects the piece of land that they would like their new house on. The buyer selects the design of the home, number and size of the rooms, and all of the components that make up the home. The buyer can choose to eliminate items that are not important to them, and incorporate items that may not be offered in other houses. The buyer can choose to spend more on some things and less on others. This gives the buyer complete control over the final price and allows them to choose where their money is best spent. With custom homes, the quality of your home will be very high through enhanced quality control because the builder personally manages each phase of construction for the home. All of the builder’s attention is concentrated on a single house. Most builders will have a dedicated individual that will remain onsite throughout the entire building process to make decisions and ensure that work is being performed properly.

CONS: People often get stressed out about selecting a lot, selecting a design, having too many choices, inability to visualize the end product, and the length of the building process (to name a few). Some people feel that while purchasing an existing home might not be exactly what they want, they can at least see what they are buying the day they sign the contract. Building a custom home carries a perceived risk that some people worry about more than others.

Tract Homes

The term “tract homes” refers to groups of homes that are built in a large quantities at the same time, on a single tract of land. Tract homes are usually sold at a much lower price per square foot. Building homes in large volume makes it possible for the builder to purchase materials and labor at a much lower rate than conventional building methods. The floor plans are typically one of only a few plans that the builder offers. They may reverse the plans or include different pre-packaged options and “upgrades”, but when it comes down to it, they are the same houses built over and over (hundreds of times in some cases).Tract homes are usually found in the suburbs and are literally everywhere here in Bucks County Pennsylvania.

The low price of tract homes is usually what attracts customers. While tract homes and custom homes serve the same purpose, the products are not the same. One is built to be very inexpensively, while the other is custom tailored to a specific client.

PROS: The low price is the biggest pro. The floor plans are designed to appeal to the mass-market, the homes are built very quickly and there are no worries about what will be built next door in the future.

CONS: The building process involves 100% subcontractors. Subcontractors are hired for very low prices and often the only way they can make money is by getting their jobs done quickly, often rushing through the work on your home. Typically there is only a small team of project managers that oversee the construction process for dozens to hundreds of homes at one time. Quality control is usually very low. Tract homes are built with cutting cost and increasing profits as the primary objectives, so quality is usually the lowest priority. Items like cabinetry, fixtures, appliances and siding are the more obvious components that lack quality. Other items such as framing components, paint, roof shingles, flooring and windows are not obvious to the typical buyer but are usually a much lower grade than custom built homes. While tract builders make you feel like you can customize the home by offering you various flooring and material options, the available options have been preselected by the builder. Instead of having 5,000+ choices of bathroom tile for instance, you may only have 12 choices. By far, the greatest disadvantage to a tract home has to be the resale value. There is always tons of competition when selling a tract home. In most cases pricing is the only thing that makes one tract home more appealing than another identical tract home down the street.


Custom homes and tract homes are two completely different animals. While they both put a roof over your head, there can be major differences in quality, price and return on investment. You should weigh out the pros and the cons and factor in your individual needs and goals before making an investment in any type of new construction.

Here at Chase Building Group, we specialize in building customs homes in Pennsylvania, New Jersey and beyond. We will be happy to discuss your new custom home with you no matter how big or small. Contact us today to start on your custom home project.

This article is Copyright © 2013 Chase Building Group, LLC.

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