Building a new home can be a time consuming process, in the research, planning and construction of the new home. Educating yourself is critical to getting the home of your dreams on the budget you
New Construction Tips For Buyers
Dated: August 9 2019
Building a new home can be a time consuming process, in the research, planning and construction of the new home. Educating yourself is critical to getting the home of your dreams on the budget you can afford.
A new construction home provides options and floor plans that may not be available on with an existing home. Custom home builders will provide an endless number of layout options, finishes and upgrades to meet a buyer's every need.
Here are some tips and advice to ensure you can achieve your dream of building your own home.
Use a real estate agent. The builder typically has a real estate commission already built into the price of the home so it doesn't costs you anything to be represented by a real estate agent. Many builders love their real estate agents and provide bonuses for agents to bring their clients. A experienced agent knows the local communities and will provide helpful information. Plus they will be looking out for your best interests while the builder's sales rep works for the builder, not the buyer. And they just might know from experience which builders will negotiate prices and by how much.
Get a home inspection. Some builders will discourage buyers from having a newly built home inspected but it's always a good idea to have an independent inspection done. Inspectors will educate you on the features of the home as well as items to pay attention to for maintenance. They will also identify any issues that you or the builder might have missed in the quality of the construction. Why wait until you've lived in the home to find out that they missed a few things? It's also a good idea to get a 2nd inspection before the warranty expires to ensure you get the most out of the builder's promise to warranty the work.
Don't settle on using the builder's lender. Oftentimes, builders will provide incentives to use their lender. Be an educated consumer and get multiple quotes. Sure you might get $10,000 in "free" upgrades from the builder but that extra .5% on your interest rate would add an extra $44,000 in interest payments on a $400,000 loan over 30 years. Make sure you compare rates and origination fees using the APR or total cost of the mortage.
Research the Builder and the Warranty. Most homes come with a builder warranty and it's only as good as the builder and the coverage offered. Many builders use 3rd party warranty companies and some products will come with manufacturer warranties. You should get information on what the builder covers and what is covered by another party. Do your homework, and get to know the builders, their reputation and what they offer. Check online reviews or knock on the doors of people who already live in the community for first hand experiences.
Consult an Attorney. Builder contracts are different from standard real estate contracts that your agent will use on resale homes. They are often loaded with terms that favor the builder. To ensure you understand the legal aspects of what you're agreeing to, an attorney would be a useful member of your home team.
Hey there! I'm Kimberly Genovese. I work with buyers, sellers and investors in Northwest Indiana who are looking to save time and money in real estate. I've been in the real estate industry since 19....
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