At this point in time we are actually doing both. I prefer to raise our own heifers, I find that they tend to stay in the herd longer on average than cattle that we buy in. Not to say that we haven't had good luck buying heifers in, but there are times where within about 2 years we have culled out every single animal out of a group we bought. Some were 'reputation' cattle and some were not. There will be a lot mention that it probably costs more on average to raise your own, and that may be the case, but, if in the end those heifers stay in the herd and raise calves for even 1 to 2 more years than ones you buy in, then I think that your extra expense will be recouped.
I have heard it said (and I believe it) that when you buy a group of heifers, by the time they are 5 years old you will have culled out approx 50% of them. Some will be dry, some will have temperament issues and some won't raise a decent calf.
You have a very big advantage when you keep your own heifers, you will have culled out anything that has or is likely to have temperament issues, poor production, udder problems and the list of course goes on. When buying a group of heifers you are certainly not going to be able to catch all of those problems, even if you get to see the dam's of the heifers, are you going to know which cows have attitude problems when they calve or are handled, you may see ones with some udder problems, but a sucking calf can make a poorer udder look pretty good later in the season. And there are some cows that are pretty good producers, but their daughters aren't...So even if you are buying privately you won't have all the info on them as you would on your own.