Jump to content
  • 0

What should I know about when considering a new build?


homesearching2021
 Share

Question

3 answers to this question

Recommended Posts

  • 1

We built new with a local builder in a community. 

A few things to look out for...

1.  The price in the ad that says "starting at" is usually the lowest tier of that home.   That low tier usually doesn't have any of the upgrades showing in the picture (in the ad).

2.  Around 15%-20% on our total price came from upgrades.   Try to think logically about upgrades.  Do the hard structural things first before spending elsewhere (expanding our garage, sun room upgrade, bigger laundry room, upgrade bathroom, etc).     Def look at your garage space as they really don't give you much room now a days.  Skip spending on the deck until you live in the home for awhile and see how you use the backyard space.     

3. When sitting in the design room, just keep asking yourself "do I want to pay for this for 30 years, or can this add on be done cheaper later on?"   The fancy drawer pulls and lighting seem like a nice add on, but you can get them cheaper later.

4. We got a good deal with using the builders in house lender, but that can vary based on who you build with.  

5. Don't invest too heavily in paint as you will get nail pops and it gets a little messy  when they fix them, which you then have to repaint.

6.  Get a pre-drywall inspection and another inspection before you close.   Get everything fixed that you possibly can, since you have to deal with the builders warranty department once you close.  Depending on your builder, you might have to be the squeaky wheel to get anything fixed.

  • Helpful 1
Link to comment
Share on other sites

  • 0
  • PRO Agent

From my experience of assisting numerous homebuyers purchase new home construction I would like to add to what Wendy Gilch shared in her earlier post.

1. Builder upgrades are marked up 50% to 100% so that is your best source for negotiating a lower price from the builder.

2. I definitely encourage my clients to have a third party home inspection done before closing! Yes the builder will have a final inspection done, but they are paying for the inspection and on average that inspector will spend 20-30 minutes doing the inspection and not the 3-4 hours needed as a third part inspector will do. It is worth the buyer's expense of around $500-$550 to prevent dealing with home issues after closing which can be a frustrating and stressful process.

3. Choose a Realtor to represent you when you first decide to purchase new home construction as they can be a true asset in the 8-12 month process that you are going to encounter. They can be invaluable to you and your family as a second set of eyes and ears due to their experience in working with builders before.

4. Be careful at the builder's design center as you can quicly spend a lot of money and in some cases increasethe home's cost so much that it will not appraise for the value needed for your mortgage loan. Also, in many cases you can have those upgrades installed after the fact for much less money. A couple of examples would be plantation shutters and ceiling fans.

5. Most imprtantly ask the builder if there is an escalation clause in the contract and if there is please make sure you undersatnd what it means! This is a huge issue in the North Texas housing market right now as these escalation clauses are being activated and enforced by many of the home buiders in our area. Due to the severe increase in building materials such as lumber the builders are notifying their clients under contract that the price of their home is being increased as much as 25% in some cases. The buyers are given the option to agree to the higher price and given a limited time such as 3 days to decide. If they decide not to agree then the builder invokes the escalation clause which allows them to cancel the contract and then sell the house to nother buyer at a higher price. Also be aware that if you do agree to pay the higher price the builder is asking for the house may not appraise for the amount needed for the mortgage lender.

  • Helpful 2
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Answer this question...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share

×
×
  • Create New...

Important Information

Guidelines and Terms of Use