New Construction Home Buying Tips

Are you buying new construction? Here are eleven things you need to know when buying a new construction home! 

Whether you are a first-time home buyer or have owned multiple homes, new construction sometimes seems like the best option. If you have been searching the real estate market for a while, purchasing a newly built home might be the answer. 

New construction refers to a brand-new home that has never been lived in before, which is part of the allure. Since the house is brand-new, everything is pristine, and no parts need repair. 

There are multiple options if you decide that new construction is the best path for you and your family, from custom-built options to purchasing a home from a developer. 

How Do I Buy a New Construction Home?

That said, if this article reads with familiarity, that's because there are similarities between buying an existing home and buying new construction. If you haven't read the most recent guide to purchasing a home article yet, stop and read that first. Then, after you finish this article, read this one - how much does it cost to build a house? It's filled with great information from some of the best Realtors®. This article is intended for people who have made their educational foundation with the prior read to help them take it further when buying new construction.

Knowing how to buy a house will help you significantly in your new construction home-buying process.

Buying a home is one of the most significant financial transactions of one's life, and it can be intimidating for anyone. Buyers need to educate themselves to protect their equity. In our market here in Raleigh, new construction homes are popular due to the city's significant growth and expansion. 

By the end of this article, you will learn: 

• How to buy a new construction home
• Questions to ask your builder
• Things to know when buying a new construction home
• Do I need a Real Estate Agent to buy a new home?
• How to make an offer on a new construction home
• New construction home buying process
• How to identify a good builder for new construction 
• What to look for in New Construction and New Community plans 

If you're buying new construction and want to learn more about the process, this guide will offer eleven tips. We will also be linking to some incredible content on the web. With so many articles out there, it's essential to read what will help and avoid reading what isn't.  

Buying a new construction home is an entirely different dynamic than purchasing a house someone has lived in. You will be buying directly from a builder who has built the home to sell it for a profit. This builder needs to move to a new home to move on to the next project. To understand the best strategies for buying new construction, you need to be able to put yourself in the builder's shoes.

Here is what you need to know about buying new construction  

Educate Yourself on the New Home Buying Process

This guide is to help educate consumers on how to buy new construction homes from builders. Not having a strategy, the right team, and the proper education could cost you tens of thousands of dollars in the purchase process. 

Understanding neighborhood details and plans will help determine which community is right for you. This list is in no specific order, as it matters what your priorities are.

Equally important as the new community details is the research you do on the developer or builder.

Education is the most crucial part of buying a new home, and you should start there. Once you educate yourself, it's time to find the money.

Team Up With a Lender on a Mortgage

Any time we talk to someone who is going to buy a home or even considering buying one, the first thing we recommend to them, after education, is to go shopping for money. Literally.

A fraction or two of a percentage point can save you thousands and thousands of dollars annually. 

The most important part of the home buying process is to find the right team to work with, and the first teammate you should see should be a mortgage lender. 

Many of our clients ask us, 'What do I need to know about mortgages when buying a home?' With so many different options, what makes the most sense for me?

A lot goes into choosing the right mortgage and lender, which is why shopping for money early on is essential.

At the start of any home purchase, the first thing a buyer needs to do is shop for a lender. Raleigh Realty recommends buyers ask at least five lenders for their rates and options. Even the slightest difference over 30 years could save you upwards of $20,000.

You Want a Realtor When Buying New Construction

Did you know that builders pay the agent's commission? That's right, the builder will pay your agent to represent you and negotiate a better deal for you. Why wouldn't you want an agent to represent you and ensure you receive the best deal possible?

Finding a top local Realtor® who is experienced in negotiating with builders will be one of the most important things you do in the home-buying process. You must make sure that your Realtor is someone who is going to work well with you. Do not be afraid of Realtors® who are transparent. It would be best to embrace these Realtors® because they will tell you the truth, whether pretty or ugly.

You'll also want a Realtor® who will explain everything, including working with a real estate agent's guide. Every Real Estate Agent is different, and it's essential that the Realtor® you're working with can help you the most in the home-buying process.

Once you've selected a Realtor®, it's time to develop a plan. What criteria are you looking for in your next home? Your Real Estate Agent will be able to help you figure out your wants and your must-haves. Now that your team is together, it's time to begin researching different builders in your area.

It's important to understand that looking at homes online versus in person is an entirely different experience. For new construction, this article rings true because, chances are, the pictures you're looking at are of a home that has yet to be built. 

So, if you're buying a home that has yet to be built, what's the most important next step?

Research the Builder When Buying New Construction Homes

Raleigh's new construction differs from that in other parts of the country. The builders here cannot build fast enough to keep up with the consumer demand, which poses a new set of challenges when negotiating the best deal with builders. You must ensure you're working with a top local real estate agent. They will make sure your new home is the best deal possible.

Researching the best new home builders and new home communities in the area is not the most fun, but it is super important. It's a lot easier than you think, too. We recommend our clients start with a Google search for 'best new construction builders in Raleigh' or 'top new communities in the Triangle area.' The time and effort you spend researching the best new construction homes will pay off.

You can look online for reviews, testimonials, and news on each development you're interested in. If you can connect with current residents online through social media, you will have great informational resources to make an educated decision. Plus, you want to learn about your potential neighbors as well. 

Feel free to ask the builder many questions since there is a good chance they will also have a lot for you. One good question is, 'What are the plans for the new development?'

You and your Realtor® will list the top new communities and the top new homes you want to see. Then, it's time to go hunting. 

Creative Negotiations When Buying New Construction

You want a Realtor® representing you during negotiations for your new construction home. You might think that by cutting out a Realtor®, you'll receive a better price; however, builders are highly unlikely to budge on price. This is why you need an expert to work for you during negotiations—someone who knows the ins and outs of securing the best deal possible. 

Everyone wants the best deal possible; sometimes, that doesn't necessarily mean a lower price. This is especially true when you're making an offer on new construction homes. Often, buyers will assume the best way to negotiate with a builder is to have them drop the price. This is not the case—upgrading is the best way to deal with builders. 

Builders are reluctant to drop prices because they must maintain a specific value for their neighborhood and future buyers. This doesn't mean they won't drop the price because they often will; it just means you will get more from negotiating upgrades.

Giving upgrades to consumers is an easy way for them to maintain the value of the neighborhood while providing the customer a deal in a fashion that won't upset the neighbors who probably just purchased a home. 

Make Sure Everything is in Writing

If you're working with a respectable builder, there is a good chance they will honor what they say; however, they may genuinely forget the promises they made to you. 

Working with a builder without a Realtor® could cost you thousands of dollars because they know how to negotiate. An experienced Realtor will ensure that everything is in writing and will make sure the documents are signed. 

You're Buying a New House, Not the Model Home

Typically, the model home that builders have their prospects walkthrough is full of all the upgrades and amenities, so it's essential to understand what your model comes with and doesn't. You can sometimes offer to buy the model home if that's the one you'd like to purchase.  

When you see a car on display, it's always the upgraded version, and new-construction homes are the same.