Do you love the idea of new construction? or have you toured and fallen in love with a model home in one of those new construction communities?
If so, keep reading for my four tips on buying a new construction home. We are talking about new build communities. The ones where builders are building out new neighborhoods with lots of homes at one time. These are very different from purchasing an individual custom home.
#1 Use a REALTOR
I know what you’re thinking, they have sales reps at the homes! When you walk into the model home there’s a sales rep right there, who is very helpful and eager to answer all my questions. But here’s the deal – That sales rep works for the builder! Their job is to get the builder the highest price and protect his or her interest. You should want a representative working for you and helping you understand the costs involved with a new build and opportunities to save. A real estate agent can help you get the most value for your money with the least hassle. They can also help you plan for the lengthy building process and make sure everything is just right when you move in.
#2 Understand construction costs
Have you ever seen a sign advertising a new home in the low 400’s then go into the community and find out all the homes available are closer to $500,000? Why does that happen? It’s because the lowest price is the base price of the floor plan you choose with no upgrades and no lot premium. Lot premiums are not on all lots, this is only for lots that the builder considers better than other lots. For example, if the neighborhood you’re buying in has a green belt the lots along the green are probably going to have a lot premium. If the lot you pick doesn’t have a lot premium it’s probably because it isn’t as desirable …maybe it backs up to a road, a school or another home. So as you are picking out which lot you like make sure to ask about lot premiums.
There are also many construction options. Does the builder offer an additional bonus room or an option to add a third bay in the garage or extending the master bathroom? These would be considered construction options and their costs can really add up quickly. However, adding construction options during the construction process can be significantly less expensive than adding the same addition several years down the road.
#3 upgrades
Upgrades are cosmetic and these are the fun ones! Going to pick out flooring, cabinets, paint colors, etc. can be the highlight of the building process. But you can also be surprised by sticker shock! My advice is to set a budget and stick to it. Two things to focus on is flooring and the kitchen. These things are harder and inconvenient to upgrade afterwards.
#4 Home Inspector
New construction home inspections, do you really need one? I mean, if the house is brand spanking new and no one has ever lived in it? In my experience, yes! The number and severity of findings in a new home can be just as complex as in a resale home. Home inspections are well worth the time and cost.
There you have it. These are my top four tips on buying a new construction home. If you have any questions feel free to contact me here.
