Spec Home vs. Custom Home: How to Pick the Right One (Updated for 2025)

Building or buying a brand new home is a journey fraught with many decisions and challenges. The first of which is choosing a spec home vs. custom home. Either could be an excellent option for you, depending on your needs. 

So, how do you decide which is right for you? First, make sure you know the difference between your options. Then consider the factors that differentiate spec homes and custom homes. Do you need to move in immediately, or would you prefer to take your time and control every detail? These considerations and more will help you land on the perfect type of new home for you. 

What Is a Spec Home?

Construction companies or contractors build spec homes with no specific buyer lined up. They speculate someone will come forward to purchase it once the house is complete. Instead of a highly customized and unique home, their design is more generic and intended to appeal to a wide audience. 

What Is a Custom Home?

Custom homes originate with the client — they secure a lot and hire a trusted contractor. Everything is customizable with this type of house, from the floor plan to the finishes. These houses tend to be more unique, but they also take longer to see the finished product. 

Considerations Choosing Spec Home vs. Custom Home

Knowing which type of new build will be perfect for your needs comes down to several deciding factors. Use these considerations to guide your decision-making process. 

Time

Nobody enjoys waiting to move into their brand-new home. However, for some people, time may be even more important than for others. Families with small children often need a place they can move into right away. More established families or young couples can take longer to get their build just right. 

Spec homes are a great option if you need to move in quickly. These projects are typically finished or close to it by the time you’re ready to buy. You’ll see exactly what you’ll get with your purchase, and the closing can take place rather quickly. 

Custom homes give you plenty of options, but they take much longer to complete. You need to secure your finances before you even start building. The timeline starts when you purchase the land and hire a contractor to construct your new house. After that, you need to obtain the appropriate permits, choose a floorplan, make all the design choices and complete the build. 

Cost 

The cost of spec and custom homes varies widely — although spec homes are generally considered the cheaper option. 

The professionals working on spec homes know their market and can accurately price their models. You’ll find very few financial surprises when buying one of these. However, you may end up paying for upgrades or finishes that aren’t to your taste. Spec homeowners also frequently renovate within a short while to customize the house to their preferences. 

Custom homes have the potential to go over budget if you change your mind part way through. Building material prices also fluctuate, as do labor costs. All these factors add up to a potential money pit situation. However, with a custom house, you only pay for what you need and want in your home. You can choose finishes you love and can afford. Customize where you want and leave other spaces more basic. 

Level of Involvement

Spec homes and custom homes carry different levels of involvement during the building process. Your availability may dictate which type of home will work for your needs. 

Buying a spec home comes with almost no extra work or decision-making. You secure financing, pick the house and make your offer. Sometimes, you’ll find a spec home that’s not quite finished. If you end up in this scenario, you may be able to pick some of the finishes to match your taste better, but it’s quite rare.

You can pick everything in your custom home, which can be a blessing or a curse. If you have plenty of time and a specific vision, the increased level of involvement would be ideal. However, it can be easy to feel overwhelmed by the number of choices to make throughout the process. 

Customization/Appearance

You’ll typically be able to tell a visible difference between spec and custom homes. Both will look new and quite polished. They also tend to fit in well with their surroundings and neighborhood. 

However, spec homes can look a bit cookie-cutter, especially in developments full of them. Each house seems basically like the next one. They don’t have very distinctive or unique features. You’ll end up with something beautiful but relatively basic. 

On the other hand, custom homes can be as unique as you decide. You can choose any layout and materials you want. The only constrictions are your imagination and budget. 

Frequently Asked Questions

Are Spec Homes Cheaper?

Spec homes are typically the more affordable option among the two home types. Due to the standardized design, professionals often give a very straightforward price. With custom homes, there are many more choices that can cause the final price to go higher.

That said, it’s important to note that the spec homes’ cheaper price doesn’t include any renovations to personalize your property. If you’re looking to stay there in the long term, it’s important to reevaluate and add up every cost to see if you’re truly saving more. 

Are Spec Homes Good?

Spec homes are a very reputable option when you’re trying to choose a home. While the appearance may seem plain, it will still look and feel as good as new. You also get the benefits of having little decision-making and getting to move in right away. 

If you want to guarantee that your spec homes will be good, consider looking for reputable construction companies with experience building these spaces. You can rest easy knowing that you’ll end up with a quality house at the end of it all. 

Is the Spec Home the Opposite of a Custom Home?

Spec homes can be considered as the opposite of a custom home, as they both contradict each other. One is more generic and ready to stay in, while the other is more unique and requires extra time to build. You generally have to choose between one or the other. 

However, it is possible to build a custom spec home or have one made for you. Essentially, this is a readily made home with slight semi-furnishings for more personality that would resemble a more bespoke space. 

The trick is to incorporate elements that would naturally appeal to a certain group. For instance, free surface areas and natural lighting can attract home buyers. When you add little design choices like blue paint or wooden frames before the home is even sold, you have yourself a custom spec home. 

Which Home Type Has a Higher Resale Value?

A custom home can potentially have a higher resale value, considering that it took more expenses to really create the space and add unique elements. However, the personalization that went into that space may discourage other buyers due to a mismatch in tastes.

A spec home will likely have a predictable resale value that’s relatively lower than a custom home. However, their generic look combined with a more affordable price tag means you may get it off the market and cash out faster. 

Is Spec Home or a Custom Home More Popular?

There were 180,000 total custom homes built in 2024. Meanwhile, there are 389,000 spec homes on the market this year. In terms of the numbers, it’s easier to infer that they are more popular than their individually designed counterparts.

However, the aforementioned spec homes are currently sitting on the market and builders are facing a backlog. With custom homes, it’s easy to assume that all of them have been designed and built with existing buyers in mind. Therefore, it could be argued that custom homes may reign supreme. 

Choosing a Spec Home vs. Custom Home

You really can’t go wrong with either decision. Buying a spec home vs. custom home comes down to personal preference and any financial or time restrictions you may have. After looking through the important factors, you’re likely already leaning toward one of the options. Trust your gut and enjoy your brand-new home.

Originally published 02/17/2023 – Updated 07/01/2025