New Construction

In this time where resale homes are increasingly difficult to find, more buyers may be considering new construction.  While building a brand new home that nobody else has ever lived in is exciting, there are a few things to keep in mind. 

Don't go it alone.  Sure, it's easy to go straight to the builder and deal with them directly, but keep in mind that the representative you are dealing with is an agent for the builder.  Since the seller pays the bulk of the agent's fee anyway, why not have your own agent representing you and your best interests?  The builder is not likely to reduce the cost of the home because they don't have to pay a buyer's agent.  They already calculated that cost into the budget.  Consider signing a buyer's agency agreement with a reputable REALTOR and let them help you navigate the waters.  Just make sure to do this before visiting the model or open house the first time and take them with you.

Financing.  As with any home purchase, it is important to know how much you can actually afford.  Your agent can assist you with getting pre-approved.  The builder may have their own preferred lender, but you can choose whichever lender you prefer. They will require a mortgage commitment letter regardless, prior to breaking ground. 

Options.  Realize that when you are looking at model homes and brochures, they usually include some very significant options that are not included in the base price.  Your agent should be able to assist you in determining which options make the most sense.  If you are watching your budget, items that are built into the framework and not easily added down the road may be worth opting for, while upgraded flooring, lighting options, etc might be considered as future improvements. It is important to get this right form the start, as builders charge for changes after the order is signed.

Timing is Everything.  The time to settlement on a resale home is relatively short, usually 30-60 days. The time to build a new home will be longer.  Maybe much longer.  And specific closing dates are usually not possible.  Even after designing your home and signing the agreement, variables like construction schedules, weather, material deliveries and inspections can effect the completion date.  

Settlement.  After all the construction, inspections, walk-throughs and sign-offs have been completed, it's time to take delivery.  Depending on time of year and other factors, certain items may still not be completed.  Landscaping, for example.  Your agent will make sure you get all promises in writing for any work that is yet to be completed.

There are a lot of moving parts in the building, financing and delivery of a new home.  Your REALTOR can help you manage through it all.