Troy Hansford for Denver Real Estate | 303-617-0607 | HansfordTeam@TroyHansford.com
          

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Key Questions To Ask Yourself Before Deciding To Buy A Brand New Home

Without a doubt, most of the nation is coming off what has been one of the rockiest roads in real estate history. After an unprecedented crash in the housing market five years ago, until today things have been shaky and buyers have not had a consistent idea of what to expect.

Today, things are shaping up and we are starting to see an improvement in the market. Still, many buyers may not know if the time is now to buy new construction or rather stay with buying a resale home. Here are some important questions that buyers considering a brand new home most frequently ask. The answers will help you in making your decision about whether new construction is right for you.

Do Realtors work with new home builders? Do they have their own in-house agents that buyers must work with?

As a buyer, you have every right to choose which agent to work with in any sale transaction. In fact, when you go to view a model home with a builder, you will likely encounter one of their salespersons. While they are knowledgeable about their products and can share valuable insight into the building of their properties – keep in mind that they have their company’s best interests in mind. The ideal scenario is for you to mention you are just looking and to hire an independent Realtor to manage the transaction and look after your best interests.

Why haven’t there been as many new build homes the past several years? Why are there more now all of a sudden?

One of the aftereffects of the housing crash was a market with a surplus of inventory. As a result, buyers had far too much to choose from, prices stayed down and the cost of purchasing a resale was usually less that what it would cost to build a new one. But now that inventory levels have dropped and demand continues to climb, we are seeing prices go up again and builders staring to build again.

Are builders willing to negotiate on price?

Most houses that are built from scratch go hand in hand with current demand, leaving the builders in a fairly comfortable spot without the need or motivation to haggle on price.

There may be some instances where a home that was built for a buyer that backed out for whatever reason might be available. If so, the builder may offer a discounted price on the home. Keep in mind though that you would have to accept the home with the customization choices of the original buyer.

One of the ways that buyers of new construction get deals is through the amenities and features. Though there may not be too much wiggle room in the final price you may very well be able to negotiate additional upgrades at no cost. This will depend on the cost of materials, the builder’s current inventory and other factors.

Will builders accept a contingency offer to accommodate the sale of the buyer’s first home?

Most builders will allow you to have a contingency in the offer but they will provide for a certain period of time within which your home must be sold. The builder will not initiate any building permits or begin work until the closing is done.

The builder wants me to use their own preferred lender. Is that a good idea?

In most cases, buyers will be able to get the best deal when working with the builder’s preferred lender. There will likely be additional incentives offered. Sometimes that means the buyer’s closing costs will be covered. Other times a builder’s lender might give you some discount points or there may be an additional home warranty offered on the property.
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If a newly built home may be in the cards for you – contact me today. I welcome the opportunity to assist in making this and all of your real estate goals a reality and I look forward to working with you!