A few important things to consider when purchasing new construction.
Buying a resale house versus new construction are very different processes. Builders don’t like to negotiate their base prices, they have to keep them similar because they are selling lots of the same models.
As long as people are buying their homes, they have no reason to negotiate the price. However, builders are more receptive to negotiating things or credits. Instead of asking for a $10,000 reduction in the price of the house, have your agent ask for a $10,000 credit at the design center that you can use for picking out that gorgeous kitchen.
You can also ask for a closing cost contribution. Not every builder is going to give you credits. It depends on how popular their product is, and the climate of the market. But it certainly doesn’t hurt to ask so be sure to talk about that when writing up your offer.
CLOSING COSTS – Every builder is different, but no matter which one you go with – pay very close attention to the closing costs. Many large builders push all of the closing costs (except for the real estate fees and a few others) over to the buyer’s side. This can be thousands of dollars in extra closing costs that you wouldn’t be paying if you were purchasing a resale house.
If you’ve got a home to sell and need to sell it to get into your new home, be careful as to the timeline and think about possible renting back from your new buyer.
This brings me to CONSTRUCTION TIMELINE EXPECTATIONS Say your builder estimates that it will take four months to build your house. That is their goal, but in reality, they can never be entirely sure when that house will be completed. Builders have to deal with weather issues, materials being supplied in a timely manner, contractors doing work correctly, permits, inspections, and so much more. It is a lot to manage and everything doesn’t always move along smoothly.
I hope this information helps all of you out there thinking about buying a new construction home.
Be sure to reach out to us if you’re thinking about buying new construction, don’t forget the agent at the office is there to protect and negotiate on behalf of the seller and you want someone in your corner too. It doesn’t cost you more money and you most likely may end up actually paying more without proper representation.