1. Find a Great Realtor -Be sure it’s someone who has experience in new construction and isn’t affiliated with the builder. Model homes are typically staffed by a real estate agent who has a relationship with the builder. It’s important for you to have an agent to represent your best interests, from advising you on how to structure your offer to be most appealing to the builder to making choices that can affect your home’s resale value. Some developments have site registration policies that require your agent to accompany you on one of your first few visits.
Realtor Tip:Ask your agent to check the site’s registration policy before you go. Your agent may be able to register you online or via phone so you can visit the model at your convenience. Or you may arrange a time to look at the community with your agent.
2. Be Creative During Negotiations - Builders don’t like to drop their prices. Instead, consider asking for the builder to pay closing costs or perform upgrades at no additional charge. Builders are often reluctant to set a precedent for negotiating prices since future buyers in the development may expect similar discounts. Consequently, builders are often more likely to negotiate “on the back end” since closing costs and upgrades are a less obvious way for them to sweeten a deal.
Realtor Tip: If you’re considering an offer, ask your agent to research the builder’s negotiating style on prior sales in the community and other developments they have built to determine if there is a particularly effective way to approach the offer.
3. Get Everything In Writing -Don’t sign anything until everything has been negotiated, agreed upon and written into the contract. If you’re considering purchasing a home that is not yet complete, it’s very important to spell out how the home will be finished, what will happen if construction is not completed on time and the deadlines for decisions that will occur through the process. Verbal conversations are not binding, so everything important must be put in writing and signed by all parties.
Realtor Tip:Builders often use customized purchase agreement documents in place of standard forms commonly used in your area. Ask your agent to get a copy of the builder’s documents to review in advance.
4. What You See Is Not Always What You Get -The fit and finish of the model home doesn’t necessarily represent what comes standard. Often the model home reflects a mix of standard materials and fixtures, as well as a handful of upgrades. When touring the model home, make sure to find out which is which. The important thing is to know exactly what you’ll be getting, what’s available and, of course, what it will cost. Keep in mind that costs can change. The price quoted at the start may not be the same when you decide to move forward.
Realtor Tip:Ask your agent to help you get a list of standard features and, if available, a list of common upgrades and their associated costs.
5. Do Your Research on the Builder -Visit other developments and talk to homeowners. Search online for reviews, testimonials and news. Keep in mind that many builders will have both happy and unhappy customers in their past. Look for trends in reviews and make sure any concerns are covered in the purchase agreement documents.
Realtor Tip:Ask your agent if they’ve worked with the builder in the past or are aware of their reputation.
6. Get a Guarantee - You’re often buying a home that is not completed. What guarantees do you have the home will be ready on time? Your purchase agreement documents should specify a completion date. However, many builders add provisions that make the completion date dependent on permit approvals from the municipality or availability of building materials from suppliers. There can also be additional charges if you’re unable to close on time if your lender isn’t ready.
Realtor Tip:Ask your agent to point out in the agreement what happens in the event of a delay on either side.
7. Get the Home Inspected -New homes have problems too. Hire an inspector to make sure everything is safe and up to code. Even though most municipalities require new homes to pass permit inspections, an independent verification with a qualified inspector is money well spent. In many cases, the builder will allow buyers to conduct an independent inspection and agree to repair code compliance issues but do not include a provision that would allow the buyer to walk away and retain their deposit if they are not satisfied with the result of the inspection.
Realtor Tip:Ask your agent to investigate and explain the inspection process and your rights in the agreement to request repairs or terminate the agreement.
8. Find Out What Is Covered - Many new homes come with a warranty from the builder, but not all warranties are created equal. Know what is and isn’t covered and for how long. Many builders use a third-party warranty company. In some cases, the manufacturer of certain products, like windows, may have a separate warranty or guarantee and the builder might refer all issues with those components to the manufacturer instead of handling any issues directly. The builder should be able to provide details on which part of the home is covered by which policy.
Realtor Tip:Ask your agent to obtain warranty information early in the process so your offer documents can be prepared to address any concerns upfront.
9. Look to the Future -Check with the city to see what is planned for the surrounding area. If you have a view, will it still be there in five years? Most builders put the responsibility on the buyer to be aware of neighborhood or community dynamics related to other development in the area like traffic planning, the development of neighboring parcels, etc. Many new communities also have homeowners associations that can impact your potential new home as well.
Realtor Tip:Ask your agent about writing in a review period for you to investigate the area or plan to do some research before submitting your offer.
10. Do Your Homework on Lenders - Don’t automatically use the builder’s lender. Shop around for the loan that is best for you, not them. Some builders require that you get pre-approved with the builder’s preferred lender. By the time you are ready to make an offer, you probably have already spoken to a lender of your own. It can come as a Surprise when the builder requires you to also get pre-approved with their lender.
Why would they do that? First off, it’s reassuring for the builder to hear about your qualifications from their lender, even if you don’t wind up using them. Secondly, it can sometimes be the most cost efficient option. Much like using the financial arm of a car company, they are often willing to offer more competitive rates and fees.
Additionally, in some instances, the preferred lender is the only option. This is especially true for projects that are in the early phases of development. If no other lender has entered that development yet, it can be hard to obtain a loan from any lender but the preferred lender.
Realtor Tip:Ask your agent to help you find out if there are any special offers, promotions or contractual differences if you agree to use the builder’s preferred lender.
Please feel free to contact me if you have any questions or think you might be ready to buy or sell. I would love to help you answer your questions and walk you through the process. My number is 602-531-5514 or e-mail at email@example.com
Have a Great Day
The information listed above is from the following website article: https://www.redfin.com/resources/how-to-buy-a-new-construction-home
Author:Kelley Kemmis Phone: 602-531-5514 Dated: July 17th 2016 Views: 203 About Kelley: Kelley Kemmis obtained her license from Arizona School of Real Estate and Business before joining Am...
View our latest blog posts in your RSS reader. Click here to access.
CLIENT SERVICE GUARANTEE: American Allstar Realty is committed to providing every customer with the highest level of service. As your agent, I promise to always remember that YOU are the most important person in the transaction. At American Allstar Realty, we believe that communication is the cornerstone to a successful transaction. Please feel free to communicate your wants and needs to me as frequently as possible. If I am ever unavailable to receive your call, I promise to return your call as soon as possible; normally in less than one hour.
Buying or selling a home is about much more than just the price you pay for a piece of land. Selecting a property to become your home or place of business is what it is really about, and that's why I enjoy helping my clients buy and sell real estate. My clients come to me because of my knowledge of the industry and my familiarity wi th the area. I can help you find that "dream" home. Call me today and let's get started!
To navigate the complex decisions involved in today's real estate market requires the guidance of a professional. I am committed to service with an emphasis on accountability, reliability, timeliness and enthusiasm. I provide my clients with all the information necessary to help them make real estate investment decisions throughout the changing market cycles.
A successful real estate transaction is built upon the strength of relationships and the experience of how to get things done. I am well respected by my peers, and have developed invaluable working relationships with other professionals in my industry such as title companies, attorneys, lenders and appraisers.
Arizona is seeing record amounts of people moving to our great state a
"Kelley Kemmis helped us through the process of selling and buying a new home. She worked tirelessly to find our perfect house and was patient and supportive during the buying and inspection process. Anytime we get lost she was there as a supportive voice. American Allstar Realty knows how to hire amazing people."