Buying a new construction home involves a different process than buying a pre-existing home. The most obvious difference is that when buying a new construction house, you will have to visualize the final product without seeing it in front of you. As with any situation where you are about to spend a lot of hard earned money, it’s important to go in prepared – and that means asking the right questions. But what are the right questions?
On a brand new homesite, your first interaction will be with the builder’s sales representative, or agent. This will be your first opportunity to ask all of the questions you might have regarding the lots and floorplans available, costs, design, HOA covenants, and any other essentials factors you may need to know before jumping into this large investment. Make sure to write your questions down and don’t be shy about getting the answers that you need. Here are some important questions to consider to get you started:
Who is the builder and what is their reputation?
The abilities and experience of the builder will have a significant impact on the quality of the final product. Ask around for other buyer’s experiences or related contractors in the area who may have worked with that particular builder in the past.
Where can I see past examples of their work?
Most of the time you will be heading to a dirt lot and will need to envision what your dream home will look like. Ask the agent about seeing floorplans, whether it be on paper or touring spec homes available to view. Are there any other subdivisions around that area that this builder has constructed? If so, drive through the neighborhood and see the exteriors.
What are the standard finishes and can you make additional upgrades once the home has started?
Many of the model homes that you tour will be loaded with upgrades. Talk to the sales agent about what comes standard in the home as opposed to what money you will have to fork out of your pocket for the additional features you would love to have in your new home. Check to see if any of the extras have to be paid upfront. There is also a possibility that you will decide later that you want to add additional features. Some builders will not allow changes to be made after they start construction. Ask if the builder allows changes throughout the building process.
Is the lot cost included?
Each floorplan comes with a base cost; what might not be included is the cost of the land. Be sure they have figured the lot premium into the base price when you get a quote.
How long will the building process take to be completed?
Unfortunately, new construction homes are prone to delays due to weather, materials used, etc.; you may be able to get a general idea of what month to expect the home to be finished. Be sure to ask if the build time will include the time it takes to get the permits. Make sure you plan in advance where you will live if a delay occurs. Do you need to extend a closing date? Can you go month to month at a rental home? Will family members put you up until your home is ready?
What warranties are provided with the house and how often can you visit after construction has started?
Just because everything is new doesn’t mean that no problems will arise. Ask what the warranties will include and for how long those items are covered. You might also ask if you can do periodic inspections during the building process to ensure that the builder may not have missed anything, or built something wrong during the building process. You don’t want anything to get overlooked or need repair after the home is near completion.
Who will oversee the construction on your home and Who do you contact throughout the building process with any questions?
Building a home is a very involved process that includes making hundreds of small decisions. When you have questions, and for your own peace of mind, it’s best to know who you can contact directly with questions or concerns.
Are you allowed to purchase your own appliances or materials, if so, will you get credit?
Did you have your heart set on a certain feature but the design center doesn’t carry that material? Ask if you can purchase it yourself and then have the builder install it. This can include appliances, but note that refrigerators, washers and dryers are usually not included in the package. If they do allow you to purchase your own appliances, will they lower the base price or offer any credits for self-purchased materials or appliances?
Is landscaping included?
Sodding and planting trees and plants can set you back thousands of dollars. Some builders include this as basic yard work, while others leave an unfinished dirt lot, and it is your responsibility to landscape – on top of the home purchase. If they include the landscaping, ask what materials are used, if you can fluctuate the design, and what is the warranty on landscaping. Know ahead of time who is responsible for replanting if the grass dies or some other mishap occurs.
Does the contract include a cost escalation clause?
New builds are notorious for last minute surprises, but you don’t want to be on the hook financially if it happens. A cost escalation clause allows the builder to charge you for any unanticipated costs that arise as a result of additional necessary labor or materials. So if lumber prices go up before the builder has purchased the materials for your flooring, or an unexpected delay adds a few weeks onto the build, you could be on the line for those increased costs. If you’d rather not deal with the stress of unanticipated costs, find a builder that doesn’t include a cost escalation clause in the contract.
Are there any homeowner rules and regulations?
Most developed land areas have restrictive covenants even if there is no homeowners association for the development. Covenants are merely guidelines that specify what is or is not allowed on your property. Make sure you are okay with these rules, regulations, and bylaws.
Financial incentives for using the builder’s preferred lender?
Some builders offer discounts if you obtain your mortgage through their lender; however, this doesn’t mean that lender offers the best deal out there. Shop around for a mortgate and don’t make a final decision based on discounts alone.
If it’s your dream to build a new construction house, go into the process with an open mind and a clear idea of what you can expect. Team Anderson Realty can help you through this process seamlessly. Negotiate the best deal possible with our knowledgeable agents and know who the builders are that we’ve had great and not so great experiences with. We are located in the Village District of Holly Springs where new construction is going up all around us on a daily basis. Our agents are experts and can take a lot of the stress off your shoulders through the entire building process, call us today at: 919-610-5126.