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Investments
5 things to know before buying brand new construction

In many ways, buying a new construction home is like buying a new car. You get to choose the color of your interior and exterior, select your upgrades, and relish in the glory of owning something that hasn’t already belonged to someone else. What’s not to love?

While there are a lot of perks associated with being able to customize your new abode, buying a new construction home doesn’t come without hiccups and surprise costs. Here are five things to keep in mind during the process:

 Think long-term

Before building a home in a new community, do your research and consider what your future will look like in the neighborhood. Check with the city to see what kinds of improvements and developments are planned for the area, especially where there’s vacant land.

Be creative during negotiations

Most builders stand firm on their prices to prevent having to give future buyers a discount. Therefore, you’ll have to get creative during the negotiation process. You may have better luck asking your builder to cover closing costs or throw in some free upgrades.

Research your options for financing

Oftentimes builders will offer special financing packages with upgrade incentives to buyers who use their in-house mortgage company. While these offers may be tempting, be aware that using the builder’s lender is not your only option. Shop around and compare interest rates, points, and fees to find the perfect fit.

Get everything in writing

If you’re buying a home that hasn’t been built yet, make sure you get everything (and we mean everything) in writing before signing on the dotted line. This includes upgrade particulars, when the home will be complete, and deadlines for decisions that will need to be made throughout the building process.

Order a home inspection

Even a brand new home can have hidden defects that require pricey repairs. Protect yourself from moving into a house with foundation, roofing, plumbing, or electrical problems by hiring an independent home inspector who isn’t affiliated with your builder to check things out.

When investing in new construction, don’t make any assumptions about what you’ll ultimately end up with. Even though you’re buying a brand new home, the process can come with more uncertainties and costs than you might expect. However, with some careful planning, you’ll be able to spend your money wisely and end up with a home built exactly to your liking.

Photo: Hello Lovely/Blend Images/Corbis 

 

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Kate Kasbee
Kate Kasbee is a blogger and freelance copywriter living in Los Angeles. She has a background in real estate marketing and has also written about a variety of subjects including pet care, how to adopt a vegan diet, and technology. Prior to living in sunny California, Kate spent eight years in Chicago where she lived in nine different apartments in five different neighborhoods. Though she’s not quite done exploring, Kate dreams of planting her roots and owning a home with creaky floors and plenty of land for starting an organic farm.
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