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New build questions

Home Mortgages and Home Buying New build questions

  • Avatar StateOfMyHead 
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    Status: Advanced Practice Provider
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    Joined: 01/01/2019

    My preference would be purchase a resale but to get the neighborhood and home style I want it looks like I may be doing a new build. With regard to negotiating, which I know can be limited with new builds, my thought is to wait until November when residential construction is generally slow. I am in no hurry to move in should things become delayed by holidays and/or winter weather. Do you think this would allow me additional negotiating power? Should I meet with the builder now to get the actual estimate for what I would want? I know there would be some fluidity such as if the selected lot isn’t available, change in product costs etc. but without having a baseline how would I know if I’m getting a better price in the fall? Thank you in advance.

    #217217 Reply
    Avatar jhwkr542 
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    Status: Physician
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    Joined: 02/15/2016

    No, I don’t think you’d have much more negotiating power if you’re designing from scratch. If you’re buying a new home that’s already built, you would have a little more negotiating power depending on the market but probably not much. Builders know their homes can sit, especially over the winter, so I’m sure they’re willing to wait 6 months for a better offer. When we designed ours, the builder was pretty much take-it-or-leave-it with all of the upgrades. Lot and base home price for the floor plan we picked (and tweaked slightly) were set. In a hot market, price may actually increase slightly though not enough to make you rush your decision.

    #217219 Reply
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    Avatar nephron 
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    Status: Physician
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    Joined: 05/09/2019

    We built before too. You usually pay about 10% for a new construction. Make sure you pick a reputable and experienced builder. Not sure if you get a discount buying in a slow time, if they are building from scratch though they may not be able to start much in the winter time, needs to be a certain temperature for the foundation

    #217221 Reply
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    ddswifey ddswifey 
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    Status: Spouse
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    Joined: 04/17/2019

    Choose a builder with a fee structure you like.  We had a flat fee builder (very reputable). Its not uncommon to get builders that want a percentage of total cost.   No thank you. If I am upgrading things, You are not gonna get a cut if I want nicer light fixtures.   That was a no go for us.    We worked with someone that was just a “custom homebuilder.”      Not spec and custom.      Get a budget and then expect about 15-20% more than you budgeted.  Silly things like your driveway costs more than you expected, or fill dirt, it was never ending.   Just be aware of that upfront.  We loved the process but it is like a second job— or atleast we made it that way. However, we didn’t have a single item on a final punch list because we basically oversaw the subs even behind our builder.

    I'm here to learn

    #217255 Reply
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    Avatar StateOfMyHead 
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    There are only 2 builders, with limited models, approved for this neighborhood. The good news is both have decent reputations.

    #217257 Reply
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    Avatar SValleyMD 
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    Status: Physician
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    Joined: 05/12/2016

    For those type of track home or model home builds where the builder often owns the lot and design (or you are locked in to certain models) you might get a discount depending on the market or if they are in need of dumping things quickly

    True custom homes then no, at least in today’s current environment imo

    #217261 Reply
    Liked by StateOfMyHead
    Dreamgiver Dreamgiver 
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    Status: Physician
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    Joined: 03/09/2017

    Another recommendation for a flat fee builder. And good builders in this economy do not need to give discounts.

    #217264 Reply
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    ddswifey ddswifey 
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    Status: Spouse
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    @StateOfMyHead– With that type of custom scenario (choice of builders in a specific subdivision) I don’t think you will get a better price in Fall VS Spring.     Can you define what type of “custom” build the house would be.   There’s several different notions to “Custom” building.  Sounds like maybe your scenario is option #2 listed below.

    1)  True custom. You own the lot. You choose builder. You choose any house plan that will fit. You make every design decision according to your budget. This is the one where your budget can swing 15- 20%.

    2) Limited builder choice, they offer limited options. They give you options for their 5  house plans.    They have  SPECIFIC design choices for every aspect of your build.   There’s 5 lighting packages to choose from, There’s 3 plumbing design choices, etc. . There’s 3 level of flooring choices, etc.  They will give you a quote after you tell them what type of design choices you want.

    BE AWARE— every single upgraded thing you want will cost you.  Added media/sound? extra sq footage on your patio? Your wife wants a herringbone pattern in your bathroom tile?   Extra cabinetry/trim? You want a frameless shower door?….. You get the point.             This does take  away a ton of the hassle of finding every option (like in scenario #1) just be aware that you really need to know all the design choices UP FRONT.     This scenario is limiting if you start adding different choices throughout the build process.  You can ask in negotiation  for things like blinds, appliances,  central vac or a fence.  They may not “lower their price” but you can ask them to throw in things like that. Wait till they tell you their price and if these items are included in their budget they give you—THEN ask for those final things. otherwise they will just include them in your price.

    3)  Limited builder choice per the subdivision but you get ANY design options you want. You show them styles of things you like and they will give you a budget based on that.

    Just know what kind of design options this builder offers. Better yet, find a house with all the amenities you like and ask exactly how much it cost to build that one. Then don’t make mid-build changes.

    Good luck.

    I'm here to learn

    #217280 Reply
    Liked by StateOfMyHead
    Avatar StateOfMyHead 
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    Thanks @ddswifey yes it is scenario 2. They own the lot and it isn’t custom just new build with a choice of styles and upgrades although I would imagine if you were willing to pay for custom upgrades they would accommodate. I am hoping since both have done multiple developments in a tri-state area they have honed their craft with styles they are building.

    #217314 Reply
    Liked by ddswifey

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