Real Estate

12 Ways Buying New Construction Is Better, Worse, And Way Different From Other Homes

Written By: Jaymi Naciri
Thursday, March 22, 2018

Buying a new home isnt the same as buying an existing home. The more you know going in, the more prepared youll be to roll with the process - or run from the process.

Everything all bright, shiny, and new

No one elses taste, no one elses floorplan, no one elses germs. When you buy a brand - new home, its built for you and hasnt been lived in by anyone but you.

Decisions, decision, decisions

There are those who love the idea of selecting the flooring, the cabinets, the kitchen countertops, the finishes, and the myriad other choices that need to be made when building a new home - and then there are those who get the shakes just thinking about it. If youre the latter, perhaps an already - built home is a better option for you.

What you see is not what you get

Model homes are typically decked out with beautiful upgrades and multiple options, and those upgrades and options can cost big bucks. If you want your home to look like the model, be prepared to shell out far more money than what the base price of the house indicates.

Youll have a warranty

"Warranties for newly built homes generally offer limited coverage on workmanship and materials >

The duration of coverage varies depending on the component of the house. Coverage is provided for workmanship and materials on most components during the first year. For example, most warranties on new construction cover siding and stucco, doors and trim, and drywall and paint during the first year. Coverage for HVAC, plumbing, and electrical systems is generally two years. Some builders provide coverage for up to 10 years for lsquo;major structural defects, sometimes defined as problems that make a home unsafe and put the owner in danger. For example, a roof that could collapse is a lsquo;major structural defect.

Home warranties are typically extendable after that first year, although youll be responsible for the cost.

You may have to buy sight unseen

In some cases, model homes may not be built - or only a few of the floorplans will be featured as models - and you wont have an opportunity to walk through the homes to get a feel for how they live. You should have pictures and floorplans to view, and maybe even a virtual tour, but if youre the type that needs to be in it to get it, you may be disappointed.

The noise - and the dust

When considering which home to buy, the location of the lot is obviously important. But have you asked about how construction is going to roll out in the neighborhoods? It could be that your home is on a street that serves as a main artery for trucks and other construction traffic. Or perhaps youre in a location where construction is going to be going on all around you for months. Yes, the noise and dust will disappear - eventually. But how long are you willing to wait?

Dont expect a price reduction

You may be used to negotiating on the price of an existing home for sale, but new home prices arent typically negotiable. The builder or developer may be willing to throw in some upgrades as part of the negotiation, but, the hotter the community, the less likely you are to get anything for free.

You can still work with your real estate agent

Working with an agent who is savvy in new construction will help get you the home you want and any available extras. Keep in mind that many new - home communities today offer real estate agents a commission for bringing in a buyer, but they insist that the real estate agent register their buyer on the first visit. So dont show up alone to tour the community for the first time You could cost your agent money and then have to navigate the purchase on your own.

It might behoove you to work with their in - house lender

If youre already working with a lender, you obviously dont want to be disloyal. But, there may be financial benefits to working with the builder/developers in - house lender. Many times, they offer a lower rate overall, will buy down your rate, or will offer you a "teaser" rate that keeps your payments lower for the first year or first few years.

Get familiar with this term: Standing inventory

If builders have pre - built homes that are waiting to be sold, this is the one place you may have wiggle room room on price. Another advantage of standing inventory is there is no construction wait, and these homes are often nicely amenitized with upgrades.

You might not be able to buy the lot you want

New homes are typically >

Amenities might not be available or built right away

If a communitys amenities are a draw for you, be sure to ask about when they will be built. It could be that the pool and community park youre so excited about are years out from being realized.





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Updated: Tuesday, March 19, 2024

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All Rights Reserved.