New Construction House

new construction home

New construction refers to site preparation for, and construction of, entirely new structures and/or significant extensions to existing structures whether or not the site was previously occupied. In other words, a new construction house is one that has not been previously occupied. Typically, the seller of a new construction home is the builder.

Buying a New Construction House

It can take several months to search real estate listings, and eventually settle on buying a new construction house. The properties in average price range would all need significant updates and renovation to get them looking at how customers wanted, and when they have already spent a huge amount on the purchase price, it is hard to find another extra funds for customization and add-ons.
However, deciding to build a new construction home is the easiest part of the whole process.
When buying a new construction, you need to be deliberate about asking the right questions and advocating for yourself. The more you can understand about what to expect before getting started, the better prepared you can be for getting through the process with your sanity intact. 

In the following paragraphs, we will share the Army of Builders team’s experience with working on new construction projects and will speak about what it means to buy a new construction, as well as what the cons and pros are of going through this route.

Multiple Listing Service

New homes may not be listed in your local Multiple Listing Service (MLS). Unlike a regular seller who lists their home with a local real estate agent, homebuilders often have their own employees working for them on site. They do this to have more control and to cut costs.

What does this mean for you, a buyer? Regularly, it may mean the home builder is not a member of the local MLS. As a result, the homes may not show up in your agent’s MLS search. The builder may be more apt to advertise online, in the paper, or with billboards. So if you are interested in newly built homes, work with your agent to make sure you have identified all the possibilities or Contact Army Of Builders for more detailed information and consultation.

Construction and Sales Process

New homes are often sold before they’re built. A builder will generally get financing lined up and map out both a construction and a sales process. This means they’ll try to sell as many homes as possible before they’re even built. To accomplish this, they’ll build out model homes and allow buyers to go in and review floor plans, fixtures, and finishes while the homes are under construction. Depending on the state, builders need to get through some of the approvals process before they can actually start signing contracts.

For the most part, you can get a sense of what your new home would look and feel like and where it will be located in the community. Ready to move forward? You’ll likely have to put down a deposit, from a few thousand dollars to 10 percent of the purchase price.

Be aware that even if there are 100 homes in the community, they won’t all be available at once. Homebuilders tend to release the homes in phases. If the first 10 homes sell quickly at the asking price, and the market continues to do well, the builder can raise the prices on the second or third phase. Also, the sales cycle for a new community can take years. The last phase could end up being priced 10 percent or more than phase one, simply because the real estate market has appreciated.

Sale Prices

Is the project you are interested in nearing the end of its sales cycle, with many homes already sold? If so, the builder may be a little more willing to negotiate with you, not so much on price but on upgrades. If they reduce the price on your home and the sale closes, then that sale price becomes public record. But if they offered you an upgrade package (hardwood floors instead of carpet or higher-end appliances), there isn’t any way to track that. What could amount to thousands of dollars in upgrades could end up being a better deal than simply getting a price reduction. For many first-time buyers, new construction could be a great idea. If you’re used to renting and relying on the landlord for mechanical fixes and general maintenance, you can almost be assured that your first few years in a new home will be maintenance-free.


Exterior and Interior Customization

Nobody knows your wants and needs better than you do, and having so much control over the details that fit your home to your taste and lifestyle is quite a luxury. Buying new construction means that you get to pick out everything from the color of your siding and trim to the placement of every single light bulb and outlet. Many of the things that you get to customize are difficult – or at least very expensive – to put in after a home is constructed, such as a deep pour basement or extra windows in the living room. If you’re someone who loves design or just someone with a lot of preferences about what makes a perfect space, you will really enjoy getting to make so many decisions about the different aspects that make your house a home.
Meanwhile, you have got limited options while you do get to customize, as long as there are far from limitless options dictating your choices. For instance, you will be able to add a sunroom that is not listed as an option on the original plans or choose a different placement for the fireplace. Many builders will only let you choose between one or two paint colors for all of your interior walls, so if you want anything different, that’s a project you’ll have to take on after the home is built and closed on. In some cases, you will be able to purchase options such as different appliances outside of the buyer and have them installed with the general construction. But for things like countertops and carpeting, you’ll likely only be able to choose among the options presented by the builder.

However limited option is a good thing, as well! Unless you are a home design pro, it is easy to get paralyzed by the sheer amount of choices you can make when building a home. When building a custom home through a hired contractor instead of a development company, many buyers have to hire architects and designers to help them sift through the wide array of options and make smart decisions. In that way, having, say, six kitchen faucets to choose from instead of six hundred, is actually a benefit to buying new construction, and can help ease the stress that comes from having too many options.

Energy Efficiency

energy efficiency cool-roofs

Newer homes across the board are taking advantage of innovations in energy efficiency, and if you build new construction, chances are you will get a home that is specifically built to use less energy. There are a lot of variables in a home that can be optimized for energy efficiency, including insulation and air sealing, heating and cooling, and appliances. When you build new construction, you have more say over the strategies used to reduce your home’s carbon footprint. Your builder likely already includes some of those options, like energy-efficient windows, which can prevent the 25%-30% heat gain and loss attributed to less efficient windows. Ask about other energy saver options as well, like dual flush toilets, cool-roofs, smart thermostats, and LED lighting.

Maintenance Costs

Another pro of thinking about a new construction home is less maintenance costs in the first few years. New homes aren’t necessarily impervious to needing repairs, but the chances of having to fix a leaky roof or a broken pipe are significantly lower, meaning less stress and less money spent while everything is still new. In addition, most builders include a range of warranties with their homes, which may include a short term full structure warranty and a longer-term exterior warranty. It is a big financial benefit, and a nice relief in the years following such a major purchase.

My own experience buying new construction has been a positive one, with the cons not mattering much in comparison to the pros. To figure out if it’s the right choice for you, gather all the facts, do your research, and think clearly about what you want in a home, both now and in the future. Consider bringing an agent with you to meet with the builder’s salesperson so that you have someone helping you advocate for your interests. The more you know going into the process, the better you will be able to navigate the sometimes tricky process of building a new construction home.