What are some things that a home buyer should watch out for when buying a new home
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What are some things that a home buyer should watch out for when buying a new home?
1. I have had the privilege many times to help home buyers go through the process of building a new home. Even a regular track or production home where builders have 6-15 options of floor plans or a custom home, the process and layers of decisions can be daunting.
●There are some BENEFITS TO BUILDING,
→You can pick your own style/colors, lot location, and floor plan
●You don’t have to remodel a resale home.
●Many builders will allow a home sale contingency
●Their prices are really competitive now
●Many builders are offering finishes in the home that would normally be an upgrade like…quartz or granite counters in the kitchens and baths, hardwood flooring, etc, built into the price.
●Some builders have started what they call “Spec” homes that are in different stages of being finished in hopes a buyer will come along and purchase it before it finished…thus closing the gap of build time.
2. The DISADVANTAGES of Buying a New Home are:
●The time it takes to build from scratch – 6-8 months
●Additional costs AFTER it’s built to add:
●Uncertainty of Interest Rates – most lenders will not lock in a rate until 60 days to close.
●Builders put up models to get people to come in, visualize the homes, work with an on-site sales rep to purchase homes.
What are some other problems you find with builders?
1. Most will work with agents representing the buyers.
2. There are a few ‘landmines’ in their contracts.
●Builders create their own contracts to protect THEMSELVES.
●You do not want to be DENIED Representation.
3. Most buyers do not know that many new constructions home may come available that they cannot find online. Hiring a great agent that can help you hunt those down is important…
Here is an example of some Land Mines working with builders:
1. Getting the right title policy can protect you against liens showing up later.
2. Bankrupt builder story
3. Also, had someone more recently that built a home in a neighborhood that built 100 homes in 100 days. Sounds cool but…
●They did not do the drainage properly, the basement flooded multiple times and the seller wanted me to hide that fact. I could not do it so I did not take the listing.
●Lots of stories of those issues and builder warranties.
→Homebuyers need to know what those warranties are and to make sure they take action on them asap if they have issues.
→Had a buyer that walked away from an almost new home for that reason…
a. The homeowner tried to resolve the issues after construction
b. Warranty department blew them off until after the warranty expired
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