You’ve probably heard a lot of advice targeted towards buying existing properties, but are there a different set of rules to follow if it is a new development? Some guidelines are universal, but there are some others we’d like to point out.
Buying a brand new home allows for your own touch of personalization, but it also can come with its own set of unique challenges.
Here’s what you need to know when buying a newly constructed house or condo:
Hit the Books
Well we live in a digital age, so not actual books, but explore online resources. Founder of AngiesList.com, Angie Hicks recommends researching the neighborhood meticulously.
She explains, “We got into the home services niche, helping consumers find great companies to hire, because home is where our heart is. And your ‘home’ is bigger than the building where you lay your head. The neighborhood and larger community is an important element of where you want to build – or buy new.”
The two biggest factors to look at is the new subdivision and location.
Maria Wilhelm, vice president of sales for the Illinois division of PulteGroup comments, “ There’s no harm in actually visiting the community and talking to neighbors. A lot of people actually do this.”
Don’t make the mistake of not driving or walking around the neighborhood you will potentially buying in. When you make a visit you will see the quality of the homes in the process of being built and how the homeowners or condo association works. It’s also important to note the standard of homes being built because in the long term that will increase or decrease your homes value.
The location is especially important when you plan on renting your property. Know what type of renters you want and then plan accordingly. Check out schools in the area or accessibility to transportation.
Use a Realtor
Typically the seller pays the commission; so get a real estate agent to represent you. Choose an agent that knows the area and has worked with builders before.
Research the Builder
Chances are your builder has experience, and if they do then look into their previous work. There is a chance that they don’t and when you uncover that you can decide whether or not you want to proceed with the buying process or keep looking. Here’s a couple of aspects to check before you choose a builder:
- Look them up on review sites
- Dicisplinary actions by state or local agencies
- Complaints with licensing agencies
- Talk to previous clients
Choose Wisely
Most of us don’t have an unlimited budget so you will need to invest your money wisely. You get create your home to your specifications, so choose the things that you have control over now and can’t change in the future. For example, you can always upgrade your kitchen, but it will costly to add that extra office you want.
Scott McMillin, chairman of the board Corky McMillin, a homebuilding company, says, “In that first house you buy, buy as much as you can, but don’t do the upgrades. I’d go for locale. I’d go for square footage.”
Don’t Overdo It
You don’t want to have a grandiose house if all of your neighbors have basic homes. Stay current with the standard of your neighbor’s homes, but you don’t want to price yourself out of the neighborhood.
Know Your Floor Plan
There are a couple ways you can actualize the floor plan of a home that doesn’t exist yet. You can get the measurements from the builder and get out the ol’ measuring tape to get an idea of the space of your home. Some builders offer a virtual reality technology that allows you to see the layout of your whole home. You can also visit the site to see the framework of the house or view a model home.
Lawyer Up
This isn’t a necessity; however, contracts for new construction can be pretty complex. You should consider having a lawyer look over the documents before you sign on the dotted line.
Are there warranties?
The odds are your builder has warranties on materials and workmanship. Ask what those offers are so you know what you are cover and more importantly what isn’t covered. For example, Pulte offers a one-year warranty on workmanship, two- year warranty on mechanical and electrical, and 10 years on structure.
Get an Inspection
Don’t be fooled, just because it is a new home doesn’t mean you can forego the inspection. Hicks remarks, “Newer home can have just as many problems as older homes, and it’s always better to know what you don’t know before the last piece of paper is signed. In the case of a newly built home, a good home inspector can help identify problems before a builder’s warranty expires.”
Get Multiple Bids
Your builder most likely has a lender and closing agent that is frequently used, but they may not be your best option. Make sure to get quotes from other lenders and closing agents and make the best decision for you.
When you are buying a newly constructed house make sure to follow these 10 tips to get the best property.
Contact SOS Management & Property Services
Local: (858) 273-8800
