The Homebuyers’ Guide to NEW HOMES
Read This BEFORE You Visit Your First Model Home!
When you start shopping for a home, you’ll find that most options on the market are resales. However, one in four homebuyers ends up choosing a new home. Both options have their own perks, so before you make your decision, let’s take a closer look and COMPARE THESE POINTS:
New Homes
• Feature innovative designs and modern styles
• Are more energy-efficient
• Offer customization with options and upgrades
• Everything is brand-new and up-to-date
Existing Homes
• Tend to be more affordable on average
• Are often in well-established neighborhoods with mature landscaping
• Have already settled, so you’re less likely to encounter settling issues after buying
As you can see, both options have their own advantages. Most buyers explore both new and resale homes before deciding which is right for them. If you’re thinking about buying a new home, here are 10 important points to keep in mind before visiting your first model home.
10 Things to Keep in Mind When Buying a New Home
1. Talk to Your Agent First
Before visiting your first model home, take time to sit down with your agent and do some prep work. It’s important to determine a price range that feels comfortable for you.
If you’re selling a home, figure out the net proceeds from the sale by carefully calculating all possible costs. If you’re a first-time buyer, start by qualifying your income and deciding on the size of your down payment. Then, work out your monthly budget to identify a realistic price range.
2. Sellers’ Agents vs. Buyers’ Agents
Remember, the sales agent in the model home represents the builder, not you. They’re called sellers’ agents. As a buyer, you can work with a buyers’ agent at no additional cost. A buyers’ agent looks out for your needs, offering expertise on construction, warranties, financing, pricing, quality, and even lot selection—ensuring you get the best value.
3. Find the Right Builder for Your Needs
Builders, like other tradespeople, have different specialties. Some focus on craftsmanship, others on creative use of space, and some offer perks like below-market financing or excellent customer service. Think about your specific preferences and needs, then shop around for a builder that fits the bill.
4. Research Your Builder
Before making any commitments, check the builder’s reputation and financial stability. Ask for “spec sheets” detailing home features like floor plans, energy efficiency, lot availability, and delivery timelines.
5. Look Into the Neighborhood
Do some homework on the community. Find out about its amenities, whether funds are reserved for maintaining or upgrading facilities, and if there are plans for future development nearby. Check the rules for any homeowner’s association and evaluate commuting routes and times to ensure they fit your lifestyle.
6. Understand Options and Upgrades
The base price of a home can be a great starting point, letting you add options and upgrades without overpricing it for the neighborhood. Options include structural additions like sunrooms or extra bathrooms, which can boost resale value. Upgrades involve choosing higher-quality finishes, like better carpeting or kitchen fixtures. Keep an eye out for builder incentives offering free upgrades or discounts. Remember, some features—like decks or landscaping—can often be added later for less.
7. Don’t Forget to Negotiate
Many buyers don’t realize there’s often room to negotiate. Builders may be more flexible on pricing, upgrades, or options if a home is completed but unsold. Ask about lot pricing, as premium lots are sometimes saved to sell last, even though they cost the builder the same. Builders may also offer discounts or special financing to close deals, so don’t hesitate to inquire.
8. Ensure the Contract Protects You
When signing an agreement with your builder, make sure your interests are protected. Include safeguards like:
• Deposits held in escrow
• A clear list of upgrades
• Access to the construction site to monitor progress
• At least 30 days’ notice before the closing date
• Detailed explanations of warranties
9. Explore Your Financing Options
Some builders offer special financing packages, especially in high-volume developments. However, the mortgage market is highly competitive, so shop around. Compare rates, lender fees, and costs like appraisals, inspections, surveys, and closing fees.
10. Even New Homes Aren’t Perfect
While new homes are typically built with modern, durable materials, it’s still a good idea to hire a licensed home inspector. Use their findings to create a “punch list” for the builder to address any issues before closing. Be prepared to budget for minor modifications or additions later.
Many buyers find working with a real estate agent helps them negotiate the best terms and price with the builder.
Immediate Delivery - New Homes
Buyer Advantages Your Builder May Not Tell You About!
Here’s something you might not know: some builders have newly constructed homes available for immediate delivery. These homes are typically ready to move into within 30 days. While some builders may be eager to sell, they’re not always quick to share this information.
Immediate delivery homes are available for a variety of reasons:
• The community is nearly finished, so builders construct “spec” homes (homes built on speculation) on the last remaining lots.
• The model home is being sold.
• A previous buyer’s contract fell through.
• Builders anticipate buyers who need a home quickly, such as those relocating or who’ve sold their previous home and are ready to move.
These homes can be a great option, especially if you need to move quickly. Builders may also offer special incentives, like financing perks or free upgrades, to attract buyers during the later phases of construction. Immediate delivery homes allow you to see the finished space before committing, making them an appealing choice. Be sure to ask about availability!