There are a lot of good reasons to buy a new construction home. You get more input on the customized details of the house, your home will be built to the latest standards in energy efficiency and safety, and you're likely to need fewer repairs and less maintenance than you'd need in an older home. However, there are some pitfalls of new construction homes that you can walk into if you aren't careful. Take a look at a few important questions that you should ask before you buy a new construction home.
What Will the Community Look Like a Year From Now?
If you're buying in a new community where only a small amount of the land has been developed, then it's important to know what the plans are for the housing community in the long run. The answers can affect your enjoyment of the home and your eventual property values.
For instance, if the developer plans on a very large subdivision, or even several subdivisions, getting in on the ground floor early could mean that you'll be dealing with the sounds and traffic inconveniences of construction for a long time to come. You'll need to decide whether that's worth it to you, or whether you'd rather purchase in a neighborhood that is completely or mostly finished.
It's also important for you to know if the same builder is going to finish the project. If there's a chance of the builder losing their funding for the subdivision, then a new builder will eventually take over the project, and there's no way to guarantee that a new builder will maintain the same quality standards as the original. Lower quality housing in the subdivision will bring everyone's property values down. There's no surefire way to prevent this, but getting a sense of the builder's long-term plans for the area can give you an idea of what to expect.
Which Finishes Are Standard, and Which Are Upgrades?
Don't make the mistake of touring the model home and thinking that what you see is what you'll get. Model homes are usually outfitted with every possible upgrade and optional feature, and those cost extra. It's important for you to understand what your place will look like without any upgrades, and what each upgrade costs. That way you can decide which ones to include and which ones to skip.
Don't be in too big of a hurry to have the builder add upgrades – you may be able to save money by going without the upgrades and hiring a contractor to add them later. On the other hand, if your cash is all wrapped up in buying the house, you may prefer to have the builder make the upgrades so that they'll be included in your loan, instead of having to pay a contractor for them all at once. Weigh the pros and cons before you make a decision.
What Do the Warranties Cover?
The fact that your home contains new materials and appliances that are less likely to break in your first few years of home ownership is a definite plus of buying a new construction home. But you still have to plan for the possibility that something will break down or develop a problem, just in case. That means understanding the warranties.
Typically, the warranty for a new home will cover the workmanship and materials of things like drywall, siding, and trim for one year, and it will cover the workmanship and materials of things like HVAC and plumbing for two years. You may also get a 10-year warranty for "major structural defects" – for example, a roof that could collapse. Some things may not be covered, like appliances or anything that may be otherwise covered by a manufacturer's warranty. It's important to understand what will and will not be covered before you buy. You may be interested in buying an additional 3rd-party warranty if you don't feel protected enough by the builder's warranty.
A good real estate agent with experience in new home construction can help make sure you ask the important questions and get the answers you need. Contact a local real estate agent for help in navigating the new construction home buying process.Share