Last year, in the United States, around 1.4 million new homes were constructed.
For many people, having a new home built is a dream come true. Having a new home built opens up many possibilities and options that aren’t available when purchasing a pre-existing home.
If your dream is to have a new home built, this guide is for you.
Buying a New Home
Buying a new-build home is not the same as buying a home that has already been built. You can avoid having a bidding war with competitors, and more customization is available. This makes the process less adversarial than you might experience if you’re going after a decent, older home.
As with any other home, a great place to start is with a real estate agent. You’ll want to find someone who is experienced in the area you want to build. They will serve as a middle person in your negotiations and help to make your experience as easy as possible.
Many builders have a variety of options available when it comes to new homes. You can choose a floor plan that is already developed, or go with a custom floor plan.
There are some advantages and disadvantages either way. The more custom a job is, the more expensive and time-consuming it will be to build.
Often, new homes will be available as part of larger real estate development packages. This is often the case when a new subdivision of homes is built. You could have multiple options as part of this development, but many of the design choices will be taken care of upfront before your involvement.
Advantages and Disadvantages of New Home Construction
Buying new construction is often going to be more expensive up front. Don’t forget to factor in other expenses into your calculation, such as setting up your home. Everything from TV mounts to appliance hookups has to be determined and paid for.
While you can expect to spend more up front, remember that there are other factors that will save you money. One of the largest factors is maintenance and upkeep. Due to the fact that the home is new, there will be less maintenance and upkeep. It could be a decade or more before you see any additional expenses.
Another factor to consider is the time it takes to build a home. When you buy a new home, it has to be planned and built. This includes building a foundation and preparing the land. The entire process can take months to finish, unlike an older home that is ready to be bought and moved into.
What makes it all worthwhile is the fact that it will be your home. This means you’ll have the ability to ask for specific changes, alterations, and customization. In most cases, builders will have a variety of options that you can select to change the overall layout and design of the home.
New Construction Home Buying Process
If you’ve decided to make your dream come true, you may be wondering how to buy new construction homes. In order to explain how, let’s break down the process from the beginning to the end.
1. Get a Real Estate Agent – This is central to buying any home, new or otherwise.
2. Get Mortgage Pre-Approval – You’ll know what you can afford to spend.
3. Find the Right Builder and Home – Not all new-build homes are designed equally.
4. The Consultation – Once you have the right builder, speak with them about your needs.
5. Sign the Contract – The contract will involve the property being built, timeline, cost, etc.
6. Finalize Mortgage – This is the final step before the construction will commence.
Common Questions
Now that you have an overview of the process of how to buy a new construction home, it is natural to have some questions. Here are a few of the more common questions. If your question isn’t on the list, don’t worry. Your realtor and the construction company can answer any additional questions you may have.
What types of builders are out there?
There are a variety of builders out there, and many specialize in certain types of homes. They may be developers who are building tract homes in large subdivisions. These will present fewer options but may save you money. Other builders work specifically from scratch and build unique, custom homes from the ground up. This will give you more options but cost more.
When do you start paying for a new-construction home?
There is no single answer to this, as it is part of the mortgage or contract. You may be able to defer payments until construction is finished, or be asked to start paying right away. A lot of this has to do with how you negotiate your specific situation and what mortgage company and construction company you use.
Can you negotiate a new home price?
The answer to this question is yes. It is possible to negotiate the price of a new-build home. In fact, you should be negotiating for every aspect of the home. One of the reasons to get a good realtor is that they can act as an advocate. If you work with a good construction team, they will also be flexible and open to changes and give you options that could reduce the price.
How long does construction take?
This one is harder to answer as there are a few things to take into consideration. The location of the building can play a role, as more remote locations are more difficult to work at. The size of the building is also a consideration. The time of year can bring about delays and halt work as well.
In general, you should expect that it will take around 7 months. This doesn’t include the time it will take to develop the plans if you’re using an architect. For those buying tract homes, the wait time can be a lot less, or a lot more depending on where the process is at when you buy in.
Your New-Build Home
The process can seem complicated and difficult, but once you’re speaking to construction and real estate professionals, the ball will begin rolling. They can help guide you through the process of having the home built. Choose a great contractor, like Ruhl Construction, and the entire process will be made even smoother.
If you have any questions or want to schedule a consultation, Ruhl Construction can help. We can help with pre-approval and design inspiration.Contact us today to get help with preparing and choosing the home of your dreams.
