Builders can hardly keep up with the demand for new homes in our market. While having a brand-new home built is an exciting process for you and your family, it also requires patience, diligence, and communication. Today I’m sharing five important tips for the new construction home-buying process to help you avoid hang-ups.
1. Understand the contract. Builders set up their own contracts, so you need to go through all of the addendums and ask questions before signing.
2. Understand your time frames. Every time that we do a change order or make adjustments, it takes time. Consider the labor that will go into making your home exactly how you want it, and have healthy expectations.
3. Understand your budget. Do you know the features that are included in your contract price as well as those that aren’t? Make a point of first figuring out the financial impact of the upgrades you want most. Given the rapid increases in new construction home prices over the last 24 to 36 months, you can’t leave any room for unpleasant surprises.
“Consider the labor that will go into making your home exactly how you want it, and have healthy expectations.”
4. Understand your loan terms. Everyone wants to lock in a great interest rate, but what if the schedule pushes past your lock expiration after you submit a few change orders? Depending on the costs associated with certain upgrades, a higher interest rate than what you had initially accounted for could suddenly put you over budget. Learn everything you can about the type of loan you have. Make sure your loan officer locks the time frame, remembers those dates, and maintains a high level of communication with the builders.
5. Get a reference. I know it’s hard to slow down and incorporate a few extra steps when the market is so hot, but this is critical. Some high-quality builders have been building for a long time, and others are newcomers to the industry. Experience matters. Get a reference so you can find out a bit more about a builder’s track record. Is the builder known for their especially misleading fees, or are they straightforward communicators who excel at customer service?
As always, feel free to reach out if you have questions about this or any other real estate topic. I’m happy to be a resource for you and assist with whatever new construction questions you may have.