Tips for Buying new Construction

Sarah Marrinan,September 20, 2016

In the spirit of the Fall Parade of Homes...

Here are some topics that come up often when discussing new construction homes with buyers.

Builders often expect and appreciate when buyer's have knowledgeable real estate agents representing them. Why? Because the agent will assist the buyer in many ways that helps the process go more smoothly.
A common misconception is that buyers can get a discount by going directly to the builder instead of working with a buyer's agent. For the reasons I mentioned above (and more) builders like to work with agents because they see the value an agent can bring to the process.
Often, the advertised price of the home does not include the land it will be built on unless you are buying a completed new home. It is very important to ask if the lot is included in the price and if not how much are the lots they are offering.
Many buyers believe new homes require "less work" or "less maintenance" preventing unexpected expenses but the fact is ALL HOMES require maintenance to keep them in good working order. New homes do usually require less REPAIR and UPDATES upfront but there may be other expenses such as landscaping, gutters, window treatments...
"I can save money by doing some of the construction work myself" is something I sometimes hear buyers say. For the most part, production builders will never allow this and even custom builders are hesitant. This is a liability to the builder and can cause problems in their building timeline.

On that note...

Should You Choose a Custom Builder?

Some Pros	Some Cons
No cookie-cutter plans - You can supply a floorplan or commission a set of home plans to be drawn from scratch. The home can be built on land you own or land that you acquire. You’ll be more involved in the process and have the opportunity to make many decisions.	Higher prices than a production model of similar size and floor plan Longer time to build Lot may pose additional expenses May be more financing hurdles

Should You Choose a Production Builder?

Some Pros	Some Cons
Model Homes ("what you see is what you get") Offer a range of house plans to choose from (Build homes priced for first-time, move-up and luxury buyers) Speed of construction Competitive pricing Offer home and land as a package Builder financing	Limited on finishing selections Often confined to location/developments May have much construction around you for years if you are first in to a new development

Check out these articles and resources:

Action Item: Please Review Your Credit Report

September 2016, Twin Cities and national real estate update