There are so many factors involved in that decision! This is where I start - have an appraisal done based off both the new construction plans and a renovated existing home then compare the costs of each. That should give you an idea where you stand and which way to go. Good luck!

I would consider remodel I have lots of clients that I have done this for and it turned out beautiful. I say if its not a flip and you are going to stay there the rest of your life , make it yours and enjoy!

Remodel - you tear it down, expect lots of conflict with the City - zoning, taxes, etc. - even if you maintain the existing footprint.... generally no home is too far gone it can't be renovated unless it's been destroyed by fire, tornado, hurricane or flood. Get some bids.