Whether to buy an existing home or have one built is yet another decision to make during the home-buying process. If you decide to go with new construction, don’t assume that you should simply work with the person at the model home. That person may represent the builder. A real estate agent knowledgeable in new construction, the different area builders, and their product can be a powerful advocate in your corner as you negotiate upgrades, a move-in date and other terms with the home builder.
Below are some basic pointers to prepare you for the journey ahead.
Selecting a builder
Determining the best builder or new construction product that is right for you can be a daunting task. Are you looking for a new home development or a new home in an established neighborhood? What about floorplans and elevations? What is your expectation for customizing the plan and adding your finishing touches?
You can start by defining the architectural styles that appeal to you and then seek out the builders in your area who offer those styles. Then begin analyzing the other features and benefits.
Remember! Not all builders are created equal. Due diligence is essential. Ask friends for referrals to get firsthand accounts and also read online reviews. Verify the builder’s state license status, if applicable. You can also check whether they’re certified by the National Association of Home Builders. Of course, I will also supply you with the information I know regarding their reputation.
The builder representative(s) and your real estate agent
The builder representative may be the listing agent for the property and/or it may be the person hosting at the model home. These folks generally represent the builder, not you. A builder representative’s ultimate goal is to sell you a home. His or her role is to provide a wide range of information to help you in your decision-making, from building restrictions, roads and easements to inspections, warranties, rebates and upgrades.
A real estate agent knowledgeable in new-home construction (like me!) will be able to help you wade through all the data and point out the downsides and upsides of each line item (as well as compare this information to other builders you might be considering!). Your agent also can look out for your interests in reviewing the builder’s contract, which often contains more legal jargon than consumer-friendly language.
It’s all about timing
Market conditions greatly dictate a builder’s incentive to make a deal you cannot refuse. When a builder has inventory on his hands, his carrying costs start adding up. When this happens, a builder might be more amenable to strike a favorable deal, whether it’s throwing in upgrades or taking a bit off the asking price. I can help you know when market conditions are right to ask for for these benefits.
Sometimes builders even hold close-out sales when they are ready to get rid of lingering inventory and move onto another project. This could spell opportunity for you.
A word about paying up
Financing a new construction project can be confusing, so it is important that you understand the timing of your financial obligations.
While there are always exceptions, most builders require a deposit when a purchase agreement is signed. They also require that the buyer pay for any upgrades prior to closing. If you back out prior to closing, unless the agreement states otherwise, you will lose that money. Make sure you understand every detail in the builder’s contract before signing it.
Contact us about buying your home