Buying your first new construction home - Part 2

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Real Estate

Now that you have decided you truly do want to purchase new construction, you and your Realtor will research new home communities within the price range and location that works for you.  Once you have created a list of communities, it is time to visit them with your Realtor.  Most communities will have an on-site representative who knows the products inside out.  You can tour their models and meet with the representative to learn as much as you can about their floorplans, homeside availability, and option choices.  It is best to schedule an appointment in advance if possible, but not necessary.  If you do visit the community without your realtor, please make sure you tell the on-site agent who you are working with.  The pricing does not change with or without a realtor.  It is beneficial to you to have an agent representing you in the transaction because the on-site agent works for the seller (builder), not you.  

Prior to starting your home searach, it is helpful to get pre-qualified by a mortgage lender so when you do visit the builder's sales office, you will know exactly what price home you can afford, or are comfortable with.  You don't neet to commit to the mortgage lender to get pre-qualified, and usually, the builder will offer an incentive (such as free options, or closing cost assistance) for you to use their preferred lendoer and attorney.  Since their preferred vendors know the process and their paperwork, it helps to make the process smoother for everyone.

As part of your research, review the neighborhood CCRS (Covenants and Resprictions).  This will tell you the limitations (if any) for things like fencing, landscaping, pets or exterior modifications.  If amenities such as a pool are important, keep that on your consideration list.  You have most likely checked out the schools, shopping and proximity to work before making the visit.  

Once you decide this is the community for you and your family, it is time to select a floorplan.  The on-site agent will show you choices based on what you want in terms of size, # of stories, bedrooms, etc.  They will explain the base prices and structural options available for that plan such as an optional bedroom instead of a bonus room, or a screened porch instead of a patio.  All structural options must be selected at initial contract and the interior selections will be chosen in a design center (or sometimes at the model home).  One option you will choose at contract is called the elevation.  It is the front face of the house including porch and roof line options.  There are usually at least 3 or more (a base plus) and depending on architectural detail, there will be a small price addition for those other than the base one.  Builders will not put the same exact home across the street, or next door to keep the community from looking cookie cutter. The on-site agent will explain their warranties, and the timeline for construction, option selection, etc.  Builders rarely negotiate on the price.  

Ok, you have found a floorplan that you love, it is time to choose your homesite.  The builder usually opens a community in phases of about 25-20 homsites at a time.  It is more cost effective for them to build this way and they usually have 2 homes on the same schedule.  The builder will often add a premium to certain lots if, for example, the lot is larger than the others, backs up to woods or water, or is in a cul-de-sac.  A standard lot price is factored into the home base price, and the lot premium is added on to the sales agreement, if you select one of those.  The on-site agent will let you know which homesites they currently have available for the flooplan you chose.  Some floorplans have a bigger footprint so will require a larger homesite.  Once you have a floorplan, structural options, and a home site.  It is time to move to contract.  How exciting.

More about that next week in part 3.