Have you ever bought a new home directly from the builder? Here are a few tips to keep in mind when buying a newly built home.
TIP #1: When buying a new build make sure you start with a very defined strict upper price point for add ons. After signing the builder contracts (more on those later) for your new site, you are sent to a design center where you can pick every little detail for the interior of your home. The whole process can take over 4 hours in two separate meetings. With some new homes you get to design everything. The flooring, the height of the doors and trim, the cabinets, the counter tops, the mirrors, the lighting. The list goes on and on. Not only that but every little detail has 20 different choices. I have been in design centers with a full wall of tile options just for the bathroom. It's very easy to get overwhelmed and lost in the whole process. They sit you in this room next to a beautiful model kitchen with high end furnishings. Ideally, you want that, but be very careful. Before you know it the home you bought for $480,000 could end up costing $550,000. It's easy to get carried away. So, my first and most important tip for anyone buying a newly built home is to go in with a strict price point in mind. As tempting as it may be to go above that price point, take into consideration what that 3-inch granite counter top versus 1-inch granite counter top could cost you in the long run in terms of stress and money when it coms time to make that monthly mortgage payment as well as the assets you will have to tie up in the down payment for the additions.
On the opposite end of the spectrum I think there are several aspects of designing a home that buyers should pay special attention to. These aspects tend to be less flashy and not as fun to design but they are important. For example, lighting. This is a design aspect in the home that a buyer should splurge on. After all you will be living in this home... at night.. in need of light. The more lighting the better in my opinion. Another area is electrical work. I am not a fan of wires or cords. How great would it be if you knew beforehand your television was going to be placed high up on the wall above the fireplace and you had an electrician install an outlet directly behind the TV? Wallah! No wires! Or if you know you are going to have two girls living in one bathroom. How nice would it be to install an additional outlet for all that hair straightening. No more kids fighting in the morning over who gets to use the bathroom first.
TIP #2: Next, for anyone who is looking to buy a brand new home be aware builder contracts are very very long. Give yourself a full quiet night with a large glass of wine to go over the contracts. They go into great detail and are way more lengthy than a normal purchase contract for a home. It's important that you have a buyers agent and an attorney to help you through any questions you have with the contracts.
TIP #3: Make sure to keep your lender and buyers agent in the loop throughout the whole process. It is smart to bring your real estate agent to every meeting with you. A real estate agent who has experience in helping buyers through a new build process is very valuable. As real estate agents we have an idea of relative costs of construction before entering the design center which can help you as a buyer decide whether or not you want to finish the basement or splurge more on the interior of the upper level. Also, as agents with experience in newly built homes we know how to navigate the lengthy builder's contract and are able to answer any questions that arise. Most importantly throughout this whole process, the buyer has to make sure their lender knows what is going on. In order to buy a new build, not only do you have to be pre-approved before signing the contract, but you normally have a short specific time frame to get conditional underwritten loan approval. This goes beyond a pre-approval as it requires the buyers income/assets/credit to be reviewed by an underwriter. This can get complicated, because in the beginning it is hard to nail down a specific price for the home when every little detail can change the cost. Until the buyer picks out all the design features they will only have the base price. The lender is also on a strict timeline. They need to know when the home is estimated to be completed, any delays throughout the process and how the building progresses over time.
TIP #4: Be prepared for your neighborhood to look like a construction zone when you move in, especially if you are one of the first to buy from the builder. It takes time to develop a neighborhood. The homes won't miraculously all pop up at once, but over the course of a few months or a few years. The advantage to being one of the first to buy in the neighborhood is you will most likely get a better base price than later home buyers. The saving may be worth the extra construction noises and obstacles in the neighborhood, but understand beforehand that it will be different than moving into a completely developed area.
TIP #5: Do not go to the building site of your home every day. I guarantee you will go insane doing this. The process of building a home from scratch takes time. Your foundation could sit there for weeks. During these weeks the builders are most likely running test after test to make sure the foundation is safe to build a home on and eventually live in. It may look like nothing is being done from the outside, but I promise it is. By going there every day you could potentially get in the builders way and slow down or delay the process further. The building company you bought your home through will send you various status updates and let you know when you need to be there.
TIP #6: Pay attention in the final walkthrough and pay attention to your specific builder warranty. Normally the warranty will cover any foundation or structural issues up to 7 or 10 years and any interior/exterior design and maintenance issues for up to 1 year. However this is different with every builder. When you go through the final walk through make sure you point out everything and anything you have an issue with down to a tiny scratch on the kitchen cabinet. Take advantage of buying a new home and make sure everything is sparkling perfection before you move in.
TIP #7: Move in and enjoy! Just as in any home purchase it will take awhile for you to become oriented with your new home. The advantage of a new build is you are the first person to live there. Everything is completely and utterly yours. Time to make it your own!
Have you ever purchased a brand new home? What was your experience like?
Have you thought about buying a new build? Contact The Garthwaite team to help you out!