No, I take exception: if more than half the costume pieces are bought, it can still be a "made" costume. It's a matter of how much your use your mind and your hands as well as your purchases. A "made" costume doesn't have to be hand-designed and hand-sewn.
I do vote for making. It's not just the price; it's the creativity. It's the imagination.
If you have good thrift stores in your area, please know that they're pulling out all their craziest and most dated items right now for Hallowe'eners. So go there early. Take your children and ask them to wait to decide what they want to be until you've all looked around. I would recommend this for, I guess, any child over two years old. (I say that with prejudice - I just like the cute things for babies that are in the stores! But those you can find second-hand.)
Have your children ever put together their own costumes? They may love it! One of mine (one of the boys) got so good at it he was getting fabric pieces at the thrift store and making outfits he fastened with safety pins or very rudimentary sewing. It wouldn't have made a magazine cover, but it was an indication of the creativity that he has demonstrated ever since, and is now encouraging in his daughters.
My mama used to do this with us. I remember the year I went as a ballot box. It was her very timely idea; I didn't even know what a school bond issue was, but she did, and all the neighbors loved my costume (she did have to explain it to me).
When my older grandson (the son of one of my daughters) was about nine months old, he was dressed as a bag of money (fake bills stuck on him all over), and his daddy dressed up as the burglar - all thrift-store or homemade items except for the play money.
If you need ideas to start your imaginations going, look in your library for easy-to-make costume ideas (and look through the book first to make sure the ideas are really EASY). Look on the internet, too.