5 Questions to Ask When Buying New Construction

Posted by Shawn Clayton on Friday, April 6th, 2018 at 11:31am.

Buying New Construction: Factors to ConsiderBuying a house that has not been built yet is not the same as buying existing construction. These five questions help buyers understand what they will need to know as they shop for new luxury or waterfront homes for sale. What Is the builder's experience?

Builders can range from the smallest contractor just getting started to a multi-national building conglomerate with thousands of employees and decades of experience. Before buyers get too invested into the process, they want to find out more information concerning the builder's experience and general track record. They can do this with a simple online search, and perhaps taking a look at previous work completed by the builder. Experience and a string of successful projects show buyers that the builder is more likely to finish on time with minimal obstacles along the way.

How Far Along Is the Planned Development?

Although new home purchases could be a completely custom-built home on the buyer's own land, many people buy new construction as part of a planned development. They should ask for details about the community, in particular about the stage of development in which they might buy. Buyers who put down a deposit on a lot may have longer to wait until they can move in, but they also might have more choices on the finishing touches of the home. People who buy a home that is nearly complete might be able to close quickly, but could have to arrange for any upgrades after they take ownership.

What Is Included in the Home Purchase?

When buyers start to scope out a new neighborhood in Mantoloking, NJ or elsewhere, they might be able to see inside a few model homes. They need to take all these details with a grain of salt, and ask for specifics. Most of the time with new construction, buyers have at least some say in styles, colors, and materials. The features of the model homes usually have a number of upgrades that may increase the price by several thousand dollars. In some cases, it may make sense to take the basic options and plan to upgrade the home more fully later on.

How Is Funding Handled?

Builders, especially organizations that are building many homes in a single community, often rely on other forms of funding to get them through to completion. This funding is usually through a short-term construction loan, that they will pay back once a buyer obtains a mortgage. Bigger building companies may have their own lenders, and could indicate that they would prefer buyers to go through their lender exclusively. However, it is usually wise for buyers to investigate other lenders for the mortgage, if only to ensure that they are getting the best loan terms.

What Protections Exist for Buyers?

Buyers who would not think of buying existing construction without requesting a home inspection or a home warranty should bear in mind that new construction is not always perfect. Faults in construction are certainly possible, and even a brand-new home that appears completely sound could hide problems behind the walls or under the floors. A home inspection may give buyers the information they need to feel comfortable closing the sale. They may also want to consider a new home warranty, for extra coverage once the warranty on the basic systems of the home concludes.

Buying new construction is one way for people to ensure that they will get a home that is entirely current. By asking these five questions and considering the answers carefully, buyers will have a better understanding of what they can expect from each new home they investigate.

Shawn Clayton, Owner/Broker, REALTORĀ®

Jersey Shores Luxury Home Expert

Contact Shawn

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